Small businesses and freelancers often bypass the services of a small business accountant, thinking they are too costly or simply not needed. However, the smallest financial slip-up or oversight can hurt your business cash flow or even get you in trouble with the IRS.
Accountants don’t just crunch numbers: They can help with payroll, take care of your obligations as an LLC or S Corp, track and forecast cash flow, and worry about tax code—so you don’t have to!
How do you find the right fit, for your needs, budget, and plans for the future? Here are eight questions to ask:
1. Do This Small Business Accountant Know Your Industry/Business Model?
Target candidates who work with businesses like yours—its legal structure, size, number of employees, and so on. Don’t be afraid to probe or ask them what untapped opportunities you’re missing or regulations you may not know about.
2. How Can They Meet Your Holistic Needs?
A survey from Sage found that the majority of small businesses who use accountant services do so because of the complexity of regulations and tax code, but accountants offer a range of services that bring additional value to business owners. Find out upfront how they can help you based on your business profile, growth plans, and needs.
3. What About the Long Term?
Once you’ve defined your needs, ask for a plan. What needs to happen now, on a monthly-basis, and 6 to 12 months from now? This will help your accountant better manage and allocate their time and give you a clear planning horizon.
4. Can You Communicate Together?
Communication is key to making sure each party is aware of their responsibilities in the relationship. Clear communication also drives trust. You’re handing this person the keys to your financial health, so it’s important that you communicate clearly and work well together.
5. Is this Particular Small Business Accountant Convenient?
Do you have to get in the car and drive 20 miles each time you need to sign something? Will they come to you? Do they provide digital services? You wear many hats, so consider what’s important in terms of convenience and time-management.
6. Are They Software-Savvy?
In addition to offering the convenience of digital services, are they familiar with your software platform? This is particularly important if you use cloud-based accounting software because these tools allow your accountant to access your books remotely and work on system data simultaneously.
7. Are They Worth the Cost?
While hourly rates are key, don’t get fixated on them. Fees can range from anything between $100–$300 an hour says the National Federation of Independent Businesses, but the payoff is often worth it.
Let’s say you spend 10 hours a month on accounting and taxes, and your time is worth $100 per hour. That’s time lost that could otherwise have been spent on business development. Then there are the other cost benefits. A good accountant can help you plan for retirement, maximize your tax deductions, advise on the right business structure, and provide general business advice to help you get more bang for your buck. Do the math yourself by reading Rieva Lesonsky’s advice for Calculating the Cost-Benefit Analysis of Hiring an Accountant.
8. How Do They Schedule Time?
Don’t assume that getting in front of your accountant is going to be easy. They deal with many clients and often need to schedule meetings days or weeks out. Before you start a relationship, find out how they structure client interactions. Aim to schedule regular meetings so that you can stay on top of everything and avoid a mad rush at tax time, payroll, etc.
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