8 Things You Should Know Before Hiring An Accountant

On the day your small business gets big enough to hire an accountant, you may relish the thought of delegating this responsibility to someone else. At the same time, the decision is nerve-racking, since you will be entrusting an outside professional with sensitive financial information.

Here are a few things to consider before taking the plunge:

Accountants for small businesses can help you with everything from day-to-day bookkeeping to representing you in a tax audit (if they have the proper accreditation). Do you want someone to advise you in crafting your next business plan or help you prepare financial projections so you can secure a business loan? Will you want these or other services in the near future? It’s a good idea to think long term when hiring an accountant. Look for someone with whom you can build a relationship that will grow with your business.

A certified public accountant (CPA) is an accounting professional who has a college degree, has passed a professional exam, and has met state licensing requirements. CPAs are authorized to take on more responsibilities than other accountants, most notably representing taxpayers in IRS audits. If you think your business might need any of the special services CPAs can perform, or if you feel more comfortable hiring a certified professional, a CPA might be a good choice for you. If your budget is tight and your needs are fairly straightforward, an accountant who is not a CPA (and who likely costs less) might meet your needs.

The best way to find an excellent accountant is to ask colleagues and friends for referrals. You can also find CPA listings online on the website of the American Institute of CPAs (AICPA).

It’s a good idea to talk to at least three accountants or accounting firms before choosing one. Remember that professionals work for you; don’t be afraid to ask questions and thoroughly vet accountants who might handle a vital aspect of your business.

Ask potential accountants for client references, particularly from clients in your industry. If you are considering CPAs, AICPA has links to all the state CPA registries. There is also an online lookup tool provided by the National Association of State Boards of Accountancy.

There is nothing worse than placing your finances in someone else’s hands only to find that he or she doesn’t return calls quickly or doesn’t provide adequate information when you’re under the gun. Ask potential candidates about their turnaround time for filings and reports. Find out from their references how responsive they are to requests.

There is nothing worse than placing your finances in someone else’s hands only to find that he or she doesn’t return calls quickly or doesn’t provide adequate information when you’re under the gun. Ask potential candidates about their turnaround time for filings and reports. Find out from their references how responsive they are to requests.

Handing over your books to an accounting professional is not the same as handing over full responsibility for the financial health of your business. Make sure you understand your cash situation so you understand what you are asking your accountant to do. It’s up to you to ensure that your accountant provides the level of service you expect, but an accountant isn’t a monetary wizard, so don’t make them solely responsible for your financial success.