A small business accountant can provide crucial advice. To find the right person for the job, ask potential candidates these 10 questions.
Your small business accountant is arguably your most important adviser. Not only do they manage your taxes, they can also help you grow your business and stay compliant with government regulations.
You can't trust just anyone to do this work. To find the right person for the job, ask potential candidates these 10 questions before making your hiring decision.
1. What Services Do You Offer?
Accountants specialize in different services. Does this person only prepare tax returns? Will they keep your books in order throughout the year? Can they manage your payroll?
Make sure your small business accountant offers what you need. If they can't handle everything you want them to take care of, can they refer you to someone who can manage the rest?
2. What Are Your Fees?
How does your accountant bill? Is it a flat rate for services like filing your return, or do you need to pay by the hour or month? Is there any way to get a discount, such as signing up for a full year in advance?
3. What Certifications Do You Have?
The CPA (certified public accountant) designation is the most familiar and respected certification. CPAs have gone through extensive training and passed a difficult exam covering key accounting issues. As the CPA Accounting Institute for Success notes, however, there are several other accounting certifications that may be applicable depending on your business needs, such as CMA (certified management accountant — a specialist in company accounting management) and EA (enrolled agent — a tax code expert).
4. How Long Have You Been in Business?
More experience is always a good thing, especially if an accountant has worked with comparably sized businesses in your industry. Be sure to ask for references from similar clients.
5. Who Will Handle My Tax Work?
Who at the firm will take care of your tax work? Is it the main accountant, or will they be passing you off to a junior colleague? You should know who's looking after your books.
6. What Are Common Issues in My Industry?
This is a good test question to see whether your accountant understands your industry. A quality accountant should be able to warn you about common, industry-specific issues that you might encounter.
7. Could You Represent Me in an Audit?
Not all tax preparers can represent you in an audit. They need to be a CPA, an attorney or an enrolled agent to represent you in all cases, according to the IRS. If you're in an audit-prone industry, look for an accountant who can represent you in tax court.
8. How Do I Contact You for Questions?
How often will you speak with your accountant? Can you reach out by phone or email any time you have a question, or do you need to book an appointment first? Do you need to pay every time you speak with them?
9. What Is Your Tax Planning Style?
Tax planning isn't a one-size-fits-all activity. For example, are you aggressive with business deductions or do you like to play it safe? Your accountant should keep your approach and goals in mind when preparing your taxes and providing tax advice.
10. Will You Help Outside of Tax Season?
Preparing your return is an important job, but what if you need help outside of tax season? Can you consult your accountant? Will they give you advice on how to grow your business? Will they keep an eye on your books for financial problems? Can they warn you when your cash flow is getting tight?
Finally, ask yourself how you feel after meeting an accountant. This person is handling some of your most important financial work, so you need someone you trust and have a good gut feeling about.
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