Should a small business consider hiring an accountant?

Running a business can be quite challenging. Business owners often find themselves juggling numerous tasks simultaneously. In such situations, outsourcing services, like handling accounts, can prove to be immensely helpful. While hiring an accountant is common for medium to large-sized businesses, many small business owners and sole traders underestimate the benefits of financial assistance. An accountant not only saves you valuable time but also imparts important knowledge and information regarding your taxes and accounts, potentially helping you save money.

Although finding an accountant may seem simple, ensuring that you hire a competent one requires careful consideration. While all accountants may seem capable of saving you time and effort, finding one who truly understands you and your company is crucial. In this article, we will explain why investing in financial aid is worthwhile and provide tips for finding a good accountant.

How can an accountant help your business?

If you have doubts about whether hiring an accountant is worth it for your small business, especially if you’re not generating millions of pounds, it’s time to understand how they can assist you. While you may excel at running your business and possess comprehensive industry knowledge, you may not be an expert in financial matters. Accountants are well-versed in various areas of finance, including taxes and compliance. They can handle your business’s financial administration and provide essential advice. A competent accountant ensures accurate filing of your accounts, keeps you away from tax troubles, aids in creating business plans, forecasts cashflow, assists in winning loans and grants, and elevates your business. Additionally, they can help you maximize your expense claims, leaving you with more funds to invest in your company. If you believe that saving money on taxes, freeing up time for yourself or your company, receiving help with business planning and cashflow, and assistance with loan applications are valuable benefits, hiring an accountant is worth considering.

What’s the difference between an accountant and a bookkeeper?

Before searching for an accountant, it is essential to understand the distinction between accountants and bookkeepers, as their roles can overlap. While both perform similar tasks, accountants generally possess a broader understanding of business finances and how they impact your company’s future. Bookkeepers primarily focus on the present, ensuring that your accounts and books are in order. Unlike accountants, bookkeepers cannot file corporation tax returns, prepare management accounts, business plans, cashflow forecasts, or calculate capital gains tax. These responsibilities are best left to accountants.

How to find a good accountant

Now that you understand what an accountant can offer and how they differ from other finance professionals, it’s crucial to find an accountant who suits your company. Since your accountant will oversee your finances and play a role in your business decisions, it is crucial to hire the right individual. With numerous accountants available, considering certain factors before making a decision is necessary.

Firstly, consider whether the accountant has experience working with companies similar to yours. If your business operates in the insurance industry, but the accountant only has experience in the beauty industry, they may not be the ideal choice for you. It is essential for your accountant to have at least a basic understanding of your industry, current trends, and your customer base for optimal results.

Secondly, examine their accreditations and certifications. These credentials can provide insights into their experience level. For instance, chartered accountants typically possess more experience, having completed a minimum number of exams, a degree-level study, and work experience. While certified accountants are less qualified than chartered accountants, they still hold relevant qualifications and industry experience, making them capable of providing excellent advice. Additionally, they may be more affordable.

Next, consider the range of services offered by the accountant. Look for those who go beyond basic services, as it provides better value for your money. Even if you’re unsure if you need all the services offered, having more options available is advantageous.

Last but not least, consider the cost. While it’s advantageous to have access to numerous services, ensure that you don’t exceed your budget. Hiring an accountant is undoubtedly worthwhile, but spending beyond your means is not recommended.

To ensure you make the right decision, ask the following questions during your initial consultation:

1. What are some examples of other businesses you have served in our industry?
2. How will you keep in touch, and how frequently will we have check-ins?
3. Do you have any specialties?
4. How could you help my business grow?

When should you get an accountant?

There isn’t a specific timeframe dictating when you should hire an accountant. You can make that decision whenever you feel it is necessary. However, once you begin to feel overwhelmed with tasks such as tax filing and bookkeeping, it’s a sign that you should start considering hiring an accountant. If these tasks start consuming your spare time or distract you from working towards your business goals, it’s a clear indication that you’re ready for an accountant. They can guide you on the best strategies to manage your finances, ensure efficient processes, and implement suitable accounting software for your business’s financial success.

By following these guidelines, you can improve your chances of finding a competent accountant who aligns with your business’s needs and goals. Remember, investing in financial aid is a worthwhile endeavor that can save you time, money, and effort, allowing you to focus on growing your business.