Ask These Before You Hire An Accountant

So you’ve done your research and found a promising accountant. Now what? 

Well it’s best to meet with them and play 20 questions…or in this case 10…to see if they are a good fit for you! (If you haven’t found a potential accountant yet, then check out our detailed guide first.)

1. Services Offered – What types of services do you provide?

It’s critical to establish if the accountant you would like to hire can actually perform the services you need now and potentially those you will need in the immediate future. For example, for owner-managed businesses, there will often be a need to coordinate corporate and personal tax returns, especially when it comes to compensation – salary/bonus, declaring dividends, shareholder loans, etc.

2. Qualifications – What experience do you have? Which licenses and designations?

Experience matters. And you should be looking for different answers depending on what service you need. A good general rule is: look for someone who has already successfully provided the service you need to other clients.

As for licensing and designations, your accountant should be happy to answer and typically will have a CPA (Chartered Professional Accountant) designation, which indicates a baseline level of competence in general accounting. Depending on the service, they may have other specialty designations – CFA, CFP, CBV, CIA…the list goes on.

3. Fees – How do you determine your fees? How do you bill?

There is a wide range of fees charged by accountants – both in the amounts charged, as well as how they are determined. You might run into simple hourly rates based on time, monthly fees, retainers, value-based fees, etc. Just make sure you are comfortable with the billing arrangement and aware ahead of time to avoid any surprise invoices.

4. Disputes or discrepancies – Have you ever had big disagreements about billing with clients? How did you solve them?

You might encounter disputes and discrepancies in billing and disagreement over a financial strategy or decision over the course of your relationship with your accountant. Hence, it is important to know what to expect during these situations.

By asking these questions, you’re trying to find out how they’d deal with issues about their charges. You want to be sure that they’ll be fair and open if there’s any confusion about the bill. You’ll find out what steps they take when there’s a problem, and how they communicate about it.

It is also helpful to know your accountant’s collaborative style and how they approach conflicts. This is crucial because you want an accountant who respects your perspective and can effectively communicate to resolve disagreements.

5. Communication – Walk me through what I should expect with communication – how, how often, with whom?

It’s critical to know what to expect, especially: how often would you meet/discuss, how would you reach them if you have questions, how long does it take them to typically respond? If your prospective accountant prefers virtual Zoom meetings every quarter versus answering ad hoc questions by email, this makes a difference.

Also, it’s important to establish who would be your main point of contact – the accountant you are interviewing or a junior accountant? Some accounting partners prefer to own the client relationship and handle all communication themselves. A team approach is more common, but can often result in fielding amusing or even frustrating questions from less experienced staff.

6. Office Structure – Who will be the one working on my file? You? One of your staff? A team?

It’s good to know if your accountant will be the one working directly on your file or if they will farm it out to more junior staff. It’s quite common for junior staff to prepare work and more senior staff or even the partner to review. If other staff are involved, ask about their experience, licensing and designations. For certain types of highly sensitive engagements, you may even want the partner or manager to be the only one working on the file.

7. Clientele – Who do you typically work with? Do you have experience with clients in my industry or businesses of the same size?

While it’s true that most accountants can likely provide a baseline level of good service, you’ll usually gain more value from a professional with deep knowledge of your industry. Different industries can have widely varying business practices (eg. car dealership vs. land developer vs. dentist office) so you’ll usually want an accountant who is already up to speed with your industry and can provide valuable insights gained from other similar clients. This can also apply to business size – an accountant who typically works on 9 figure businesses may not provide the value or attention you desire if you are an early stage startup with one employee.

8. Value – What additional value do you provide in addition to compliance/the basics/your core service?

A good accountant will complete your business year end, while a great accountant will do the same, but also help you better understand your business finances and how to grow. The additional value accountants provide can vary greatly between providers based on what they bring to the table and how they see their role working with you. An accountant with deep expertise who views themselves as a partner to your business is usually preferable to someone who sees you simply as a customer to be served just the the basics and then moved along.

9. Security and confidentiality – How do you ensure my data will be secure and confidential?

Your financial information is private and losing it could lead to big problems, like identity theft. By asking this, you’ll find out how seriously they take data security, what they do to protect your information, and how they’d handle it if something went wrong.

10. Tax laws – How do you stay updated with the latest tax laws and accounting principles?

You want to find out if they’re committed to staying up-to-date. Tax laws and accounting rules change all the time, and a good accountant needs to keep up so they can give you the right advice. By asking this, you’ll find out how they keep learning and improving. 

Making a decision

1. Know what you need and to clearly define the role

Accountants have different specialties. Some are tax experts, others are good at auditing or financial advice. Knowing what you need helps you find someone with the right skills after evaluating their answers to the questions.

2. Evaluate the accountants

Sure, you will find many accountants with the experience and skills you need. If several seem good, compare them directly. Along with their skills, qualifications, and years of experience, weigh up their strong and weak points. See who stands out. Also, think about hard skills like software use and soft skills like teamwork. Look for signs they’re keen to learn and grow, like ambition and goal-setting, and if they’re ready to take on more tasks as time goes on.

3. Check the reference

People who’ve worked with the candidate before can tell you about their past job performance, including what they’re good at, what they need to work on, what they’ve achieved, and how hard they work. References can also give you a sense of whether the candidate is reliable and honest, which are key for any job. Plus, how someone acted in the past often shows how they’ll act in the future, so references can help you guess how the candidate might perform going forward.

Conclusion

When hiring an accountant, it’s vital to examine their qualifications, experience, fee structure, communication approach, clientele, and value-added services. Equally important is their commitment to data security and staying updated with tax laws and accounting principles. Match these insights with your specific needs and compare candidates’ strengths, weaknesses, and growth potential. References are invaluable in assessing a candidate’s past performance and reliability, providing a comprehensive view of their suitability. Careful consideration and insightful inquiries pave the way for selecting the right accounting professional for your business.

Looking for an accountant in Canada? CPA Guide has a network of the reliable and trusted accountants and CPA firms across the country. We will connect you to the best fitting accounting firms for your needs at CPA Guide.