Is your accountant taking away your financial worries, if not why not?
A comfortable relationship is important
Accountants should be more than bookkeepers, they are another form of business advisors, or they should be. Getting the right advice is critical for the success of your business and having the services of an accountant who provides pertinent, timely and cost effective advice about accounting, finance and tax is crucial.
A good accountant will help you navigate the massive tax laws and government compliance, along with providing the financial advice you need to manage and grow your business. They need to be able to provide for current needs, whether they relate to tax, compliance, accounting and finance, as well as keeping you focused on future issues.
You don’t want you accountant doing your bookkeeping, they are too expensive for that. You want them to spend their preparing your annual accounts, tax returns and government lodgments in an accurate and timely way.
Of course, where they can play their biggest role is in ensuring you have the business properly capitalised in order to have profitable growth and be sustainable. If you have a lingering cash flow or taxation problem, then you might be better advised to look for a new accountant.
Technology is changing relationships
Many businesses use their own stand-alone accounting software, while others use a bookkeeper who enters the transactions into the accounting system. In more recent times the ‘cloud’ has caused quite dramatic changes in accounting systems.
The new systems automate many bookkeeping functions, saving significant data entry time and coupled with daily bank transaction it is possible to have accurate financial data on demand. You can even go as far as making connections with the taxation department for compliance, lodgment of documents and returns.
Using the cloud your accountant can monitor you figures and report immediately on any discrepancies. If accounting practices don’t evolve with the new technologies and ways of financial reckoning, they will be left behind and you will soon be looking for another accountant who offers the sort of service you expect.
You are now able to review your financial situation at any time, knowing that the information is accurate and up-to-date. This, of course, helps considerably with forward planning, budgeting, cash flow forecasting and enables the use of current financial figures for decision-making.
Qualities to look for
When engaging an accountant, either for the first time or to replace an existing one, there are qualities you should look for in both the accountant and the firm they are working in, before making a decision.
Good listener. You need them to listen intently to your story, otherwise, they will be guessing what needs to happen next. Fiddling with papers, looking out the window while you are talking doesn’t cut the mustard.
Good network. Does your accountant have a big network of specialists and people who may be able to support you? If so, are they willing to introduce you to them to help you instead of trying to know everything themselves? Remember that in business your network is your net-worth.
Future-focused. Accountants are used to adding up the past, but what you really need is a help to see the future. Find an accountant who is going to work with you on the future of your business while taking care of the past, on time every time.
Responsive, not reactive. Today, you want an accountant who is able to respond quickly communicate with you in real time using technologies that didn’t even exist a few years ago. You want answers and you need them now, not next week or next month when they are ‘free’ and you want them to put forward ideas, not just be reactive to your requests.
Value for money. You don’t want to be paying top dollar for basic information you can find anywhere. You want an accountant who can direct you to good information when you need it and who can focus on what is really important to you and your business.
Avoid clock watchers. Look for an accountant who is less about the time they spend with you, and more about partnering with you for the future, one who appreciates the lifetime value of a client. This is the perfect partnership because as you grow, your needs become larger and therefore you need more from your accountant which in turn increases their billings.
Decision making. It’s fine to give you options, but many times you need guidance and it is always helpful to have an accountant that will back their judgement. After all, that is what you pay them for, advice, not options.
What makes them so different. Accountants should only expand into areas that they have proper expertise, policies and procedures for. If they do not then they should have relationships with other facilitators and coaches that do have the expertise. Like many professions, the competition has forced accountants to move into other ways of generating income, other than tax. However, you need to be sure that they can deliver what you expect of them.
Understandable. Your accountant must be able to present critical information in a way that you can understand and is reliable, practical, useful and helpful. Should not be walking out of your accountant’s office shaking your head and confused with little understanding of what has been discussed or what the numbers mean.
Reliability. You need to be able to depend on an accountant to be up-to-date in their field and they can offer their overall service with the help of their support staff. Their advice can be spot on, but if they expose you to unnecessary risks then that advice counts for little.
Follow-up. Good accountants follow through on what you have agreed to, is as much a part of their service, as the advice.
Guarantee their work. If a problem arises, then accountants like any other business need to guarantee their work. Mistakes can be costly and you don’t want to be paying for their mistakes, or incompetence.
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Take your time in choosing and accountant as it will be, or should be a close relationship for a long period of time. It’s unfortunate, but it is very difficult to differentiate between accountants until it is too late, and many people are reluctant to recommend one.
However, taking the time to find an accountant with the right combination of financial knowledge, business insight, technical proficiency, temperament and understanding of your business and industry will significantly increase your chances of success and reduce your sleepless nights.
Never settle for second best, engage the best accountant you can find and if they cost a little more, it will be well worth it.
Don’t expect you accountant to understand marketing and other functions beyond financial matters, as that is what they are trained for. Anyway, explore the accountant’s competencies and make sure they are a good match to your requirements.
Many accountants are buried with government compliance matters and have little time for anything beyond financial matters.