Finding an accountant

If your business is taking off and you find yourself spending too much time figuring out financial admin, it might be a good idea to hire an accountant. A good accountant can be a real asset to you - they can help free up your time. Here we cover the basics of what you should consider before hiring an accountant.

One thing before we start - remember that if you’re a Starling business customer, you could also try out our Business Toolkit, with all kinds of bells and whistles for accountancy and VAT.

What does an accountant do?

An accountant can help you comply with your tax and Companies House obligations by filing the appropriate forms and accounts. A good accountant will be able to offer tax advice so that you’ll have more money to reinvest in your business. The best sort of accountants will provide business advice to help you to grow. Accountancy is an area that is increasingly automated, which in a way means greater pressure for accountants to offer you additional support. If they can help you to grow your business profits you may actually end up paying more tax BUT you’ll also get to keep more at the end of the day. As you might expect, the benefits they provide will be reflected in the price. Those offering simple compliance services will be cheaper than those proactively helping your business to grow.

What is the difference between bookkeeping and accounting?

These days there’s overlap between the work done by accountants and bookkeepers but the traditional split is:

Chartered or certified accountant

• Annual accounts and tax.

• Audit for medium sized and large companies or others that are obliged to have one.

• Monthly account management.

• Confirmation statement.

• Personal tax.

• Tax advice.

• Business advice.

Bookkeeper

• Bookkeeping.

• VAT returns.

• Payroll and/or CIS.

If you’re looking for a Certified Public Accountant (CPA) then you’ve been reading US business books/articles - it’s an American phrase. The UK equivalent is a Chartered (ACA or FCA) or Certified accountant (ACCA or FCCA).

How do I find a good accountant?

First, you need to decide what sort of accountant you want and what services you wish them to provide. If you’re already using a bookkeeper, they may work with several accountants and have inside knowledge on who would be best suited to you.

Ask your business friends about their accountant and dig into which services they actually provide and whether these are the things that you need, too. Have they actually been proactive or is it just a once a year meeting? Bear in mind who is giving you the referral and whether they value the same thing as you in an accountant.

Where to find an accountant

Check out the professional organisations such as ICAEW (Institute of Chartered Accountants of England and Wales), the Institute of Chartered Accountants of Scotland (ICAS), CIMA (Chartered Institute of Management Accountants), or a cross-border body like ACCA (Chartered Association of Certified Accountants). These days there is little difference between chartered and certified accountants so their personal experience may be more relevant to your choice. For a small, simple business you can also check out AAT (Association of Accounting Technicians) who should cover the basics well. Members of these organisations have passed professional exams, have a minimum level of experience, are obliged to stay up to date with changes in law, have professional indemnity insurance to cover any problems and are signed up to an ethical code.

What to look for in an accountant

Meet with your chosen accountant to discuss what services you require and how you will work together. Questions to ask your accountant should be about your future relationship as the initial meeting is not to get free tax advice (because they can’t know your business well enough in just half an hour), but to establish whether you have a good rapport and are comfortable sharing quite personal information with the firm. As you’ll probably deal with a more junior member of staff for most things it’s worth asking to meet the rest of the team. These days much of this process can take place online rather than in person.

What to ask an accountant

Ask about service levels, how long you should expect to wait for a response to any questions, how long to produce your accounts (which may take longer the first year as there will be more questions) and how rapidly they expect you to respond to requests for information. You can also discuss whether it will be cheaper for you to do some of the bookkeeping work yourself, with help from the Starling Business Toolkit or software such as Xero.

It’s helpful if your accountant has experience in your particular sector but, unless it’s a sector with distinct tax laws, most small businesses need the similar services.

As your business grows your requirements may change so do review your accountant every three to five years to ensure that they are still the best one to help you. Also, if your accountant grows rapidly or is taken over, you may find yourself a small fish in a big pond and not getting the same level of personal care. This is a business decision and should not be perceived as a lack of loyalty on either part. If you move from one qualified accountant to another then their professional standards will ensure as smooth a transition as practical. This means that it should be easy to switch accountant as your requirements change.