How do I select a good accountant for my small business?

Answer by Wray Rives:

You should be choosing an accountant for a small business based on if they are adding value to your business.  In my experience small business owners fall into two categories #1 they have a good technical skill they are able to sell or #2 they are just really good salesmen.  Rarely are they really good bookkeepers and accountants and rarely is that the area of the business where the owner really adds value to the business.  So at a minimum the value add for the accountant may just be that he or she frees you up to spend your time on things that really matter to growing the business.

Do you need a bookkeeper?

If you have a heavy transaction based bookkeeping needs, then you really may need a bookkeeper and if you have to choose between the two I might tell you that hiring the bookkeeper is a better option, because

  • bookkeepers cost less than accountants
  • bookkeeping tasks can be very time consuming

so, if you can only afford one pay for what gives you the most time savings.

That said, technology has almost eliminated the need for a bookkeeper for a lot of businesses.  There are any number of online accounting apps that will automatically download your transactions from your bank and credit card accounts and virtually eliminate the data entry aspect of bookkeeping.  So if you need to initiate a lot of Accounts Receivable and Accounts Payable transactions yourself, then spend money on a bookkeeper first, but if you just need to summarize and report on your financial activity, then use technology to do the mundane tasks and spend the money on an accountant to handle categorizing and reporting on your activity and also on the compliance aspect.

Accountants should add value

Now after all of that, then you have to consider the next level of value that an accountant might bring to your business.  Personally I have worked for over 30 years either directly or as a service provider to hundreds of companies that range from $100,000 a year in revenue to over $17 B a year in revenue.  Not to sound too self serving, because I am not the only CPA with that type of experience, but I do know some stuff and a lot of that stuff is knowledge that can help a small business prosper, grow and succeed and that is really my ultimate goal with my CPA practice is to help my clients succeed with their business.  You should not be hiring me to fill in the blanks on a tax form, yes that is part of the job and often the tangible part that people see, but what you should really be hiring me for is my knowledge and expertise.

Things to ask a prospective accountant:

  1. Do you work with other businesses like mine? (both size and field)
  2. How do you work with clients?  My firm is virtual and I have clients from all over the world, some firms are hyper local.  Neither is right or wrong, expect to choose the method you are most comfortable with.
  3. Do you have certifications?  Not that it is a guarantee of expertise, but it at least gives you an idea that they meet some minimum standards and probably have to comply with come code of ethical conduct.
  4. Finally are you personally comfortable with the accountant?  I am bound by federal and state laws and professional ethics to keep your information confidential, but if you are not comfortable sharing your deep dark and sometimes ugly financial secrets with me, I can’t help you with them.

How do I select a good accountant for my small business? What questions should I be asking?