Hiring an accountant: a small business guide

The best investment you can make for your small business is hiring an accountant.

A business can be challenging even in the best of times, but the past few years have been particularly challenging. It is important for companies in challenging economic times to seek the right professional advice and support.

By hiring an accountant, you can dedicate more time to other priorities when running your small business, reducing the risk of mistakes.

By providing specialist advisory services and spotting potential financial issues early on, accountants can reduce HMRC investigations. In this article, Zyla Accountants take a closer look.

What can my accountant do?

There is more to accountants than just bookkeeping. Despite their common use, the terms are very different in practice. A bookkeeper keeps records, but an accountant provides expert analysis and comprehensive advice on a company's finances, as well as complying with HMRC and Companies House filing requirements.

Depending on your budget and your ability to handle recordkeeping in-house, you may decide to hire both a bookkeeper and an accountant. In addition, your accountant can provide advice on how to build a finance team as your business grows, such as a credit controller or a chartered tax adviser.

There is a squeeze on cash reserves due to rising inflation, borrowing costs, and energy costs. When a business owns £1m of stock and owes £100 to a creditor, it can become insolvent very quickly. These competing pressures can be managed by an accountant.

Self-employed people in the UK with an annual business income over £10,000 will need to comply with Making Tax Digital rules from 6 April 2024. Your accountant can assist you in navigating these new rules and ensure your business is compliant.

Accounting firms often offer a "one-stop shop" for all services including bookkeeping, accounting, taxation and advice, tailoring bespoke packages to suit your needs.

How to choose the right accountant

Qualifications and status of chartered members

The fact that anyone can call themselves an accountant makes it vital that you hire someone and a firm with the right qualifications, training, and experience. ICAS chartered accountants, for example, are a Chartered Accountant who has achieved the highest professional level. This is done by following its programme of expert tuition, rigorous training and examinations in accountancy and business. ICAS Chartered Accountants are also known by the letters CA, a professional designation exclusive to ICAS members in the UK.

Staffing and payroll, working with suppliers, managing debtors, business growth, and regulation are all areas that Chartered Accountants can advise on. Their knowledge of finance issues, such as raising capital, paying yourself, and dealing with HMRC, is also invaluable.

Make sure your accountant is an expert in the area where you need help most.

Are you looking for a specialist?

You should make sure your accountant understands the market your business operates in, and whether you are operating in a high-risk sector. Depending on the practice, clients may come from a variety of industries or sectors. Most large practices have teams dedicated to specific industries, such as the automotive or real estate sectors.

Make sure your chartered accountant understands your industry well as well as financial advice.

Reputation

Getting recommendations from colleagues and friends is a good idea when hiring an accountant for your small business.

Initial consultation topics to discuss

Service levels and the scope of your business needs

Check that your accountant can meet your business needs. Consider, for example, the frequency of communication and turnaround time in addition to the basics such as charges and compliance deadlines. If you have any concerns about your finances, let your accountant know so he or she can assist you.

Fees and charges

It is important to discuss fees and charges - as well as their payment dates - up front. When you have a limited budget and different rates apply to different services, decide which services to prioritise in advance. In terms of money, risk reduction, and time saved, hiring an accountant is usually a worthwhile investment.

Accounting information needed to proceed

Several pieces of information will be needed by your accountant, including key documents, HMRC letters, and National Insurance numbers. Make sure you know what needs to be provided and get it ready as soon as possible.

Choosing an accountant for your small business

You can make an important investment in your small business by hiring an accountant, so don't be shy about approaching multiple accountants to find the right one. Your business's ability to survive in tough economic times could be determined by the professional advice your accountant provides.

Contact our friendly, expert team today at Zyla Accountants for support with your business.