What should I look for when hiring an accountant?

Question

What should I look for when hiring an accountant?

Answer 1

I would add in experience with your type of business.

Answer 2

Ultimately - you are looking for someone to develop a long term relationship with. You accountant will help guide your financial health in the same way your medical practitioner guides physical health. I took notes last time we went through the accountant hunt and wrote an article about it (see the source) and included 50 interview questions.

1. Reputation

Good news travels quickly. Bad news is currently the only man-made invention that can break the time barrier. When considering an accountant, ask other business owners, lawyers and even your local IRS agent who they would recommend. The fact is, ask enough people and you will usually end up with a few good choices. We found our lawyer this way. We asked around town and all four of the people we asked referred the same woman. No contest. And they were right, she has been a true asset to our company.

2. Communication

Your accountant should never be the lone gunman. They are part of a team. They protect your assets and help you gain the knowledge you need to make smart business decisions. If you don’t understand what they are doing, and they can’t explain it to you, run like h**l. There is no easier way to get yourself in a whole lot of trouble than to allow someone to play with your money without supervision.

Start by finding an accountant who has the people skills to match your level of understanding. If you have virtually no bookkeeping experience, make sure they can explain to you what they are doing in layman’s terms. Even better, find someone willing to teach you a little as you work together over time.

3. Guidance

An accountant is different from a bookkeeper. Your accountant should offer much more than just pushing your numbers around into new formations. They will help guide your business or family from a financial perspective. Tax planning, how much you can pay yourself, how to handle contractors vs. employees, can you afford that 2nd home and a lot more. Pay the money for their advice, it’s usually worth it. Then follow it.

When interviewing accountants, ask their perspective on business topics relevant to your industry or personal directions you family planed. Make sure they are familiar with the common perils and follies of your business type. Make sure they are familiar with the tax laws that will impact you.

4. Availability

Make sure you can talk to them when you need to. If you have to wait a week each time you have a question, it will directly affect the performance of your business. Ask what their turnaround time is after a phone call. How quickly can they usually fit you in for a face-to-face meeting? How prompt are they with email?

Our current accountant is phenomenal in all aspects except this one. He’s tough to get a hold of and it frustrates me. Frankly, it will probably be the death of our working relationship some day. For the time being though, he provides solid guidance and has been there each and every time we’ve needed him.

5. Protection

One of the major roles a CPA will play is to guide you in the situation of an IRS audit. Find out the level of experience your accountant has in working with the IRS. This is very important, as I’m told that the audit process is often grueling and expensive. Our current accountant was an auditor for the IRS for over a decade.