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As a business owner, you have a lot on your plate. From managing employees to overseeing operations, it can be easy to overlook the importance of having a good accountant on your team. However, a qualified accountant can be a valuable asset to your business. They can help you make sense of financial data, ensure compliance with tax laws, and provide strategic advice to help you maximise profits and grow your business.

In this guide, we’ll explore everything you need to know to select the right accountant for your business.

Understanding the difference between bookkeepers and accountants

Before we dive into the different types of accountants, it’s important to understand the difference between a bookkeeper and an accountant. While both professions deal with financial data, they have different roles and responsibilities.

Bookkeepers are responsible for maintaining accurate financial records, such as recording transactions, reconciling bank statements, and keeping track of accounts payable and receivable. They often use accounting software to manage financial data and may work under the supervision of an accountant.

Accountants, on the other hand, are trained professionals who use financial data to provide strategic advice to businesses. They are responsible for preparing financial statements, analysing financial data, and ensuring compliance with tax laws. Accountants may also provide advisory services, such as helping businesses develop budgets, forecasting cash flow, and identifying areas for cost savings.

Types of accountants: generalists vs. specialists

When selecting an accountant, it’s important to consider whether you need a generalist or a specialist. Generalist accountants have a broad range of knowledge and can assist with a variety of accounting needs, such as bookkeeping, tax preparation, and financial analysis. They are a good choice for small businesses that don’t have complex financial needs.

Specialist accountants, on the other hand, have expertise in a specific area of accounting. For example, a tax accountant specialises in tax laws and can help businesses minimise their tax liabilities. A forensic accountant specialises in investigating financial fraud and embezzlement. If your business has complex financial needs, it may be beneficial to work with a specialist accountant.

Qualifications to look for in an accountant

When selecting an accountant, it’s important to consider their qualifications. Look for an accountant who has a degree in accounting or a related field, such as finance. They should also be a certified public accountant (CPA), which requires passing a rigorous exam and meeting professional standards.

In addition to their education and certification, consider the accountant’s experience. Look for an accountant who has experience working with businesses similar to yours and who has a track record of success. You may also want to consider their communication skills, as a good accountant should be able to explain complex financial data in a way that is easy to understand.

Factors to consider when selecting an accountant

When selecting an accountant, there are several factors to consider. First, consider the accountant’s availability. Will they be available to answer your questions and provide advice when you need it? Also consider their fees. While you don’t want to choose an accountant solely based on price, you should ensure that their fees are reasonable and within your budget.

Another factor to consider is the accountant’s technology. Do they use up-to-date accounting software to manage financial data? Are they familiar with cloud-based accounting systems, which can provide real-time financial data and improve collaboration between you and your accountant?

Questions to ask potential accountants

When selecting an accountant, it’s important to ask the right questions to ensure that they are a good fit for your business. Here are some questions to consider:

  • What services do you offer?
  • What experience do you have working with businesses like mine?
  • What is your availability?
  • What are your fees?
  • What accounting software do you use?
  • How do you ensure that my financial data is secure?
  • Can you provide references or testimonials from other clients?

Red flags to watch out for when selecting an accountant

While most accountants are qualified professionals, there are some red flags to watch out for when selecting an accountant. Be wary of accountants who:

  • Guarantee a specific tax refund amount.
  • Promise to help you avoid paying taxes altogether.
  • Lack certification or have a history of disciplinary action.
  • Can’t provide references or testimonials from other clients.
  • Are difficult to keep in communication with.

How to work effectively with your accountant

Once you’ve selected an accountant, it’s important to work effectively with them to maximise their value to your business. Here are some tips for working effectively with your accountant:

  • Be clear about your business goals and financial needs.
  • Provide your accountant with timely and accurate financial data.
  • Stay in regular communication with your accountant.
  • Ask questions if you don’t understand something.
  • Be open to their advice and recommendations.

The benefits of working with a good accountant

Working with a good accountant can provide numerous benefits to your business. They can help you:

  • Maximise profits and identify areas for cost savings.
  • Ensure compliance with tax laws and minimize your tax liabilities.
  • Develop budgets and forecast cash flow.
  • Provide strategic advice to help you grow your business.
  • Improve your financial reporting and analysis.

Selecting the right accountant is an important decision for any business owner. By understanding the difference between bookkeepers and accountants, considering the types of accountants available, and asking the right questions during the selection process, you can find an accountant who will help your business thrive.

Remember to stay in regular communication with your accountant and be open to their advice and recommendations. With the right accountant on your team, you can go from crunching numbers to maximising profits!

At FiguresUK we can meet all your small business accounting needs, from bookkeeping to tax returns and payroll, get in contact today to see how we can work with you.

Figures UK: Accountants Peterborough - Team: JCJason Cannon
Managing Director and Figures UK Founder

No matter the size of your business, whether you’re a sole trader or a Limited company, when it comes to accounting, it can be a little confusing to say the least.
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