Why Your Startup Needs an Accountant
There are many reasons why your startup needs an accountant, and the services they provide will vary as your company begins to grow and develop.
Here are some of the most valuable benefits of hiring an accountant:
- Choose the right form of business (Limited Company)
- Establish processes for keeping accounting records
- Implement tools and technology for recordkeeping
- Manage cash flows and expenses
- Process payroll
- File taxes
- Prepare forecasts and budgets
- Assist with securing financing for your startup
This list can go on, but you get the idea! The purpose of hiring an accountant is to let them take care of the financial stuff so you can do what you do best: run the business.
What to Look for in a Candidate
Once you decide to move forward with hiring an accountant, there are a few things you should consider:
Although most accountants will have some experience with taxes, cash flow management, and forecasting, it is helpful to look for one with experience helping startups similar to yours. Perhaps they have worked with other companies in the same sector or have a great reputation with investors you would like to work with - the key is to find somebody that will provide you with valuable insights to help you succeed!
Check Their Qualifications
If you need the accountant to complete specific services like audit or investment work, check to confirm that they are authorised to do that type of work. Are they certified or chartered with the ICAEW? What other qualifications do they have?
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Meeting with Accountants
Once you narrow your search down to 3 to 5 firms, it is time to set up an initial meeting. The goal is to find the right business partner, so you want to invest the time to choose the best fit. When you call to schedule the meeting, ask them if it is free or if a charge will apply.
At the meeting, start by discussing the needs of your company to see if they offer all of the services you need. Discuss the accounting records you intend to manage – hopefully, they will suggest some improvements!
Ask them for feedback on your business plan and how much they would charge to prepare reports like budgets and financial forecasts. Is that something they would feel comfortable managing?
Another important question you should ask during the meeting is who will be doing the actual work. Just because you hit it off with the person at this meeting doesn’t mean they will be assigned to your company – make sure you meet with that individual as well!
Of course, it is always essential to establish an expectation of fees and when they will be due. If possible, get some references from existing clients to verify everything they told you.
After you have asked as many clarifying questions as possible, think about whether you would be happy with their services and what they could add to your business. If you agree to move forward with them, make sure to collect an engagement letter that outlines their terms and condition.
Developing a Business Relationship
It is vital that you keep in touch with your accountant regularly, not just at the end of the year. Always keep them up to date with any changes happening in your business, including any potential issues or difficult circumstances.
Leverage their expertise to help you run your business, and keep in mind that you should continuously assess whether their services still meet your financial needs. Review their charges at least every few years too!
Finding the right accounting for your startup will ensure that you have accurate financial records so you can make strategic decisions. Whether it's by forecasting sales and budgeting expenses or calculating the change in gross margin, an accountant can give you a competitive advantage and help you stay on top of managing your startup!