When you’re a small business owner, your money is your lifeblood – so you can’t mess around when it comes to hiring the accountant who’s going to manage your finances.
The CPA you choose shouldn’t just prepare your tax return; they should also act as a trusted financial advisor who can spot potential problems before they get out of control and offer you all the information you need to make good decisions for your business. “So many people think CPAs just do their tax returns, but in the end, they can actually help save them money and help expand their businesses,” says Heidi Brundage, CPA, technical manager of specialised communities for the American Institute of CPAs.
On top of that, they’ll have access to your intimate financial details – so you better make sure you trust them, too.
We spoke with Brundage and Joshua Dubrow, CPA, a member of the Small Business Outreach Committee for the New York State Society of CPAs, to find out the top five things every small business owner should look for when choosing an accountant.
1. Look for a Good Personal Connection.
You’ll be interacting with your accountant more often than you may think. If they’re going to be involved in the most intimate financial details of your business, you need to know that you work well together. “Ask them about their processes and procedures: do they usually meet in person with their clients, or is it over the phone? How often?” Brundage recommends. “These details tell you if their style matches yours.”
“You want somebody that’s going to listen to you, listen to your problems, and understand your business,” says Dubrow. And it’s crucial that they not only explain everything to you, but also “help you understand what they’re saying,” he adds. You don’t want a CPA who just spouts tax law- and accountant-speak – you want someone who can clearly tell you what you need to know.
2. They Need to be Reliable.
Dubrow emphasises the importance of making sure your accountant is reliable. “You need someone who’s always there when you need them and who is going to meet their deadlines,” he says. It’s not worth it to mess around with an unreliable CPA.
3. They Should be Proactive.
Where your finances are concerned, you want to be aware of any issues well before they become real problems, so finding an accountant who is proactive is key. “You definitely want somebody that’s going to ask you questions and present potential problems before they occur,” Dubrow says.
CPAs are required to participate in continuing education programs to maintain their licence and stay on top of changes in tax law and accounting practices. Both Brundage and Dubrow recommend ensuring that the individual’s credentials are in order and up-to-date.
4. Choose a CPA who has experience in your specific industry.
“Accounting is a pretty general field – make sure the CPA you choose has knowledge about your particular industry,” Dubrow warns. Brundage offers this example: in retail, inventory is a huge part of the finances; in banking, there’s no such thing as inventory. A CPA who’s had experience within your industry will be well-versed with what goes into your finances.
5. Make sure they’re trustworthy.
Above all, you should ensure that the person you’re trusting the intimate details of your finances with is trustworthy. “You’re putting your money in their hands – you need to be confident that they’re going to be honest,” says Dubrow. Brundage suggests always double-checking a potential CPA’s credentials; you can ask them for their licence, or go to your State Accountancy Board website and make sure they’re registered.
Both Dubrow and Brundage suggests finding a dependable CPA by asking for recommendations from people whom you trust. Most importantly, ask them why they like their accountant – if they say it’s because that individual has all the qualities we’ve mentioned above, then you’ve got a winner. And, if you meet with an accountant, and your gut instinct tells you they might be sleazy, “go with your gut,” Brundage insists.
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