Part Accountant, Part Business Advisor
Today’s business accountant wears two hats – ‘bean counter’ and ‘business advisor’. The new breed of accountant can deliver good all-round advice on a wide range of business issues
Business start-ups without an accountant in the team from the word go are courting disaster. While there may be few beans to count in those early stages, a qualified accountant needs to be on board to make sense of the numbers and help with business and finance structures, as well as issues around compliance and tax. A company’s accountant should also have the expertise to provide advice that leads to business growth.
“It’s an old adage but “you don’t know what you don’t know,” The guidance and advice of a good accountant in the critical early years can help set you up for success. The failure rate of new businesses in the first 12 months is alarming and partnering with the right accountant can make all the difference.
An accountant is one of four professional advisors every start-up owner needs – a business funder, an insurance broker and a solicitor complete the quartet. Starting a business to going on a journey - just as a travel agent ensures you have the right information and necessary visas, and knows what to expect in an unknown country, your accountant provides a level of direction to ensure each stage of the business development journey is fully understood. This includes elements such as helping set a realistic direction and strategy, and exploring financing options, through to ensuring clients understand how to maximise profits and minimise risk. The business environment is increasingly complex and sophisticated and without this level of expert support a start-up business owner is extremely vulnerable.
Today’s accountant may more often be referred to as a ‘business advisor’, rather than a bean counter, but they’re there to do both. They’re counting the beans and making sense of them. That’s the key. Analysing and helping to understand what the numbers are telling you. What are the things you need to focus on? Are your gross margins looking good? What’s your sales plan? What’s your key customer relationship looking like? How are you going with the bank? Any staff issues? Cloud Accounting NI can give you good all-round advice on all of these issues.
It’s an important business relationship so it’s important to get a good match; that calls for rather more effort and research than simply referring to the local directory – here are three key areas:
• Rapport: Make sure you click. You’ll be sharing a lot of information so you need to feel comfortable.
• Value for money: You don’t need a bulldozer to crack a nut so make sure you’re getting the range and level of expertise that’s appropriate for your business needs, at an appropriate price.
• Trust: A good accountant will give you a sense of this by asking a lot of questions in order to gain a genuine understanding of your needs and goals. Likewise they should welcome your questions.
A chartered accountant will have spent seven years training and will undertake 40 hours of professional development annually. Cloud Accounting NI are also bound by the ICAEW Code of Ethics.
• Word of mouth is invaluable. Ask for referrals from people with similar business needs; as well as same-size business, and the same or related industry at a similar growth stage.
• Compile a shortlist. Ask for references and follow them up. What does the accountant/ business adviser do for them? Do they deliver on time; is the price fair; are you dealing with the same person or being passed around the firm? Is the business growing as a result of their advice?
• Make a date. It’s about establishing a relationship. Arrange to meet with the top few contenders and ask the serious questions – what do they know about your industry? What services can they offer you – and what will they cost? Is their accounting software compatible with yours? A personality match is also important. If you’re risk averse, you’ll probably feel most comfortable with a conservative, rather than entrepreneurial, accountant.
An accountant needs to do more than prepare financial accounts and tax returns in order to understand the fundamentals of business success, so check that he or she meets with business owners regularly at their premises and has a sound knowledge of your industry so they can advise on improving financial performance.
Start-up businesses on the fast track to success quickly require more than standard accountancy services so ask how they can help as the business evolves, grows and prospers. In particular, ask about contacts and networks, particularly if your growth plans involve export markets.
What a chartered accountant (CA) doesn’t need to do is become involved in the bookkeeping. A business needs to have a tidy back office, and Cloud Accounting NI can set these processes up for you with the right Online Accounting Software and keep an eye on this on a regular basis for you.
Cashflow’s king and you’ve got to get the bills out. Invoicing, billing, banking, paying creditors, that’s not the sort of thing you want your chartered accountant to do. And, thanks to the availability of business software, the days of throwing stuff in a shoebox are long gone, he says.
The interaction with your accountant has become more worthwhile because you’re using them to add value, to do the fine tuning in the accounts area, get your tax situation right and sit down with you to do some forward planning.
Varied expertise: Accountancy services now encompass a breadth of expertise ranging from IT support, tax planning, risk assurance and internal risk assessment through to corporate finance, forensic services and entrepreneurial and growth strategies.
In spite of ticking all the boxes when it comes to choosing the right business advisor, it may not always be a match made in heaven. If this is the case – simply “Move on.” Our advoce at Cloud Accounting NI is “challenge or change”. There are lots of good accountants who would be more than pleased to partner with you to ensure your business is successful.
If you would like advice on changing your beancounter and business advisor get in touch with us at Cloud Accounting NI – email firstname.lastname@example.org or simply call 07868 663538 and we will take care of everything for you on our ‘Easy Change’ programme.