As a small business owner, you already have a lot going on. Not only do you need to manage the day-to-day operations of your company, but you also have to worry about things like taxes, bookkeeping, and accounting. This can be a lot of work, especially if you’re not familiar with all of the necessary terminology and procedures.
That’s where a small business accountant comes in. They can help you take care of all of your accounting and financial needs, so you can focus on what you do best: running your business. But how do you find the right accountant for your small business?
In this guide, we’ll cover exactly that. We’ll discuss how to find the right accountant for your small business, what qualifications you should look for, and how to make sure your accountant is the right fit for you.
What is a Small Business Accountant?
A small business accountant is a professional who specializes in helping small businesses manage their finances. Depending on the accountant’s expertise, they can help with:
- Bookkeeping and tax preparation
- Cash flow analysis
- Financial consulting
- Budgeting and forecasting
- Business planning
- Business valuation
- Auditing and assurance services
- Payroll processing
…and much more!
Although an accountant is usually the first person you should turn to when it comes to financial advice, they can also provide a wide range of other services. It’s important to understand the differences between accounting and bookkeeping, as well as what type of services a small business accountant can provide.
What is the Difference Between Accounting and Bookkeeping?
There are some key differences between accounting and bookkeeping that you should be aware of.
- Accounting is the process of recording, analyzing, and summarizing financial information. This involves preparing reports that show a company’s financial performance over a given period of time. Accountants also provide financial advice and recommend ways to maximize profits and minimize losses.
- Bookkeeping, on the other hand, is the process of organizing and maintaining financial records. Bookkeepers typically use software such as QuickBooks or Sage. Bookkeepers also reconcile bank accounts, process payrolls, and generate financial statements.
So, what is the difference between accounting and bookkeeping? Accounting focuses on analyzing and summarizing financial data, while bookkeeping focuses on the organization and maintenance of financial records. Both are important for any small business!
When is the Right Time to Hire an Accountant?
When is the right time to hire a small business accountant? It can be helpful to have one on board from the start, but it’s not always necessary.
Generally, if your business is generating revenue and you don’t have the time or expertise to manage your finances yourself, then you should consider hiring an accountant. It’s also a good idea to bring in an accountant if you’re looking to scale your business or if you’re planning to expand into new markets.
In addition, it can be beneficial to hire an accountant if you need help with budgeting, forecasting, tax planning, or setting up an accounting system. They can also provide valuable insights into how to maximize profits and minimize losses.
What if You Already Have an Accountant, But You Are Ready to Switch?
If you’ve outgrown your current accountant, or if you’re simply not happy with the service they are providing, then it may be time to find a new one.
It’s not worth it to settle for an accountant who isn’t meeting your needs. If you’re thinking about looking for a new accountant, here are a few questions to ask yourself:
- Why do I want to find a new accountant?
- What am I currently unsatisfied with?
- What qualities should I look for in a new accountant?
- Do I need an accountant who is experienced with my type of business?
- Do I need an accountant with specific qualifications?
- Do I need an accountant who is available to answer questions quickly?
Having answers to these questions will help you find the right accountant for your business.
Finding a new accountant can seem intimidating, but it doesn’t have to be. After all, there are plenty of qualified professionals out there who can help you manage your finances.
How to Find the Right Accountant for Your Small Business
Finding an accountant can be a daunting task, so it’s important to take your time and do your research. Here are some tips on how to find the right small business accountant:
1. Start by Asking for Recommendations
The best way to find an accountant is to ask for recommendations from people you trust. Your friends, family, business associates, and other contacts may have experience working with an accountant and can provide insight into their services and fees.
2. Decide Which Type of Accountant You Want to Work With
Do you want a local accountant or one that operates nationally? Do you need a CPA or someone with specialized experience in taxes, business planning, etc.?
You can hire an accountant as an independent contractor, hire an accounting firm, or choose to employ your own in-house accountant. Here are the pros and cons of each approach:
- Independent contractor: Independent contractors can work on a project basis, but they may not provide ongoing advice.
- Accounting firm: These firms offer a wide range of services and can provide ongoing advice. However, they can be more expensive than independent contractors.
- In-house accountant: Hiring an in-house accountant can be costly but they are knowledgeable about your business and provide ongoing advice.
3. Research Accountants in Your Area
Once you have a few recommended accountants, start researching them online to get a better idea of what they offer. You can type the following search queries into Google:
- CPA small business
- Tax accountant for small business
- Accountant for business
- Accountants for small business owners
Here are a few tips to guide your research:
Check Out Their Website
A good accountant will have a website that provides clear information about their services and fees.
Read Reviews and Testimonials
Reviewing feedback from past clients can be a great way to get an idea of the quality of an accountant’s services.
Check Their Credentials
When looking for an accountant, it’s important to make sure that they are properly qualified and certified by the applicable regulatory board or association in your province or territory (e.g., the Chartered Professional Accountants of Canada). This ensures that they are up-to-date on the latest industry trends and regulations, and have the necessary skills to properly manage your finances.
4. Watch Out For These Red and Green Flags
There are definitely red and green flags to look out for when selecting an accountant. For example:
Red flags:
- They can’t provide references or proof of qualifications
- Their fees are significantly lower than other accountants in the area
- They don’t have a website or it has outdated information
- Their communication is unprofessional
Remember, don’t choose the cheapest accountant. Cheap doesn’t always mean good value. When you’re hiring someone to look after your financials, it’s important that you choose an experienced and reliable accountant.
Green flags:
- They provide clear, concise answers to your questions
- They are experienced in the type of services you need
- They provide references or proof of qualifications
- Their fees are in line with the market rate
Be mindful of the red and green flags above. We also recommend listening to your intuition and asking yourself if you feel confident that the accountant will be a good fit for your business. (Your gut feeling is usually right!)
5. Schedule an Initial Consultation
Once you’ve narrowed down your list of potential accountants, it’s time to schedule an initial consultation with each one.
During this meeting, ask questions about their experience as well as their fees and payment structure to make sure they’re a good fit for your business. We recommend asking the following questions:
- How long have you been in business?
- What services do you offer?
- Are there any areas of expertise that you specialize in?
- What are your rates and payment structure?
- Do you offer any additional services or discounts for small businesses?
Once you have all the answers to these questions, you’ll be better prepared to make an informed decision and find the right accountant for your small business.
It’s also important to get a feel for how comfortable you are communicating with them; after all, you’ll be working closely together over the course of the year!
6. Make Your Decision
Once you’ve met with all of the potential accountants, it’s time to make a decision. When deciding on an accountant, consider factors such as their qualifications and experience, their fees and payment structure, and how comfortable you feelcommunicating with them.
7. Sign an Accountant Business Agreement
Once you have found the right accountant for your small business, it’s important to sign an accounting agreement. This document should outline the scope of services they will provide, their fees and payment structure, and any other important details.
Having an agreement in place can help protect both parties and ensure that everyone is on the same page when it comes to expectations.
8. Get Ready for Tax Time!
Now you’re ready to work with your accountant! They can help you manage your finances and prepare for tax season, so make sure to keep them in the loop when it comes to any important changes in your business.
Looking for an Experienced and Trustworthy Canada-Based Accounting Firm?
At Pivot Advantage Accounting and Advisory Inc., we provide accounting and financial services to small businesses in Greater Vancouver and throughout Canada. Our experts are qualified to serve clients in a variety of industries, including construction, technology, medical, retail and more.
We are committed to providing quality services and helping our clients succeed. Contact us today for a free consultation!
Frequently Asked Questions (FAQs)
We know hiring an accountant can be a confusing process, so we’ve compiled a list of the most commonly asked questions to help you make an informed decision.
When do I need a small business accountant?
If you own a small business, it’s important to have an accountant to help you keep your finances organized and comply with government regulations. An accountant can also provide advice on business strategy, taxes, and other financial matters.
Do I need an accountant if I am self-employed?
Yes, it’s important to have an accountant if you are self-employed. They can help you manage your finances and ensure that you are meeting all of your tax obligations.
What are the risks of not hiring an accountant?
If you choose not to hire an accountant, you may be at risk of incurring hefty fines for non-compliance with tax regulations. You may also miss out on opportunities to save money on taxes or other financial matters. Accountants can help you understand the laws and regulations related to owning a business, which can save you time and money in the long run. They can also help you find all the deductions and credits that you’re eligible for.
How much does it cost to hire an accountant for my small business?
The cost of hiring an accountant for your small business will vary depending on the type of services you need and the complexity of your financial situation. Generally speaking, an independent contractor or accounting firm will charge by the hour, while in-house accountants may have a flat fee or salary structure.
How do I know if an accountant is qualified to work with my business?
Make sure that the accountant you hire is certified by the applicable regulatory board or association in your province or territory (e.g., the Chartered Professional Accountants of Canada). Additionally, it’s a good idea to research their experience and read customer reviews to get a better sense of their qualifications and services.
What should I ask during my initial consultation with an accountant?
During the initial consultation, it’s important to ask questions about their experience, fees, and payment structure, as well as get a feel for how comfortable you are communicating with them. Additionally, make sure to inquire about any services they provide that may be beneficial for your business, such as tax advice or financial planning.