As a business owner, it is what you require from your accountant that matters most. Since you’re going to be working closely with your accountant, it has to be the right fit too.

Do I have to hire an accountant?

No. There is nothing stopping you from taking on your financial administration yourself if your business has a low volume of transactions. However, tackling any financial obligations without complete assurance is inherently risky. Also, without having up-to-date knowledge of mandatory financial and legal legislation, there is a danger that you will make mistakes and your accounting will be incomplete.

For example, you may:

• Fail to claim valid expenses.
• Lose documentation such as proof of purchases.
• Fall behind with invoicing.
• Underestimate your tax bill and face difficulties with HMRC.
• Be late on your tax returns and other compliance paperwork, resulting in fines.
• Make mistakes entering data that take hours to fix and keep you short of valuable information.

Why hire an accountant?

Hiring an accountant to help you look after your business interests often starts at the moment you need to write a business plan and launch a new company, so let us go through a few areas where an accountant is most helpful to you:

• Writing a business plan and accessing to finance – an accountant can help you to sharpen your business plan by making projections and planning different scenarios. As a result, you will have a solid business plan which you can present to your lenders or investors.
• Launching a company – an accountant can advise about your company’s legal structure, set-up your accounting and payroll systems properly and register at Companies House.
• Meeting statutory obligations – private limited companies need to prepare and submit VAT, annual accounts and tax returns, areas that your accountant can manage easily.
• Giving general financial and tax advice – your accountant should also suggest ways your business can save money legally, present you with cash flow forecasts, offer sound tax advice, to name but a few.

In London, many small business owners also rely on their accountants to do bookkeeping, manage payroll and help with business growth. As having an accountant is an integral part of your business, it is essential to hire the right accountant and know how to get the best out of them, so that you and your accountant can work cohesively towards achieving your business goals.

Benefits of hiring an accountant

Hiring an accountant means you the business owner no longer need to manage the company finance by yourself, thereby providing you with peace of mind and allowing you to focus on pressing business matters and driving the success of your business. Tellingly, a survey from financial software company Intuit revealed that 89% of small businesses believed they noticed more success with an accountant on the side than without one.

The notion that you can save costs by not hiring an accountant is also not true. If you make a mistake on your accounts, it may take time and money to fix, not to mention the legal consequences if it is something serious.

How do I hire the right accountant?

We recommend hiring an accountant with a recognised professional qualification, ideally a chartered accountant. Chartered accountants in England and Wales are guided by the professional organisation ICAEW’s Code of Ethics which sets out five fundamental principles:

• Integrity
• Objectivity
• Professional competence and due care
• Confidentiality
• Professional behaviour

In other words, a chartered accountant should be able to demonstrate the highest standards of professional conduct. To find a trusted chartered accountant, here are a few useful tips.

1. Do your research

Speak to ICAEW to help you find a chartered accountant.
Speak to friends or other businesses owners and ask them about their accountants.
Look for accountants with experience working with businesses in a similar sector (and of a similar size) to yours.

2. Interview them properly

An interview will provide a decent flavour of whether a candidate can help drive your business forward. Xero, one of the leading cloud accounting software companies, has provided a list of recommended questions:

• How would we work together?
• How frequently will we talk?
• How do you usually work with clients?
• Who will be my main point of contact?
• Do you hire junior staff to do the day-to-day work?
• What experience do you have in my industry?
• What is your fee structure?
• How would your clients describe you?
• Why do you think we would be a good fit?

3. Verify the story

• Ask for and check several references. Call their current and former clients if necessary.
• Check their qualifications, experience and connections (LinkedIn is a good tool for researching this).
• Request a copy of any accountant’s practising licence.
• If in doubt, it is possible to outsource the background screening process.

4. Hire an accountant who understands and can meet your business needs

Knowledge of exactly why you are hiring an accountant will help you employ the right one, so ask yourself these questions:

• Do I just need help producing my annual accounts?
• Do I need help with all financial administration – payroll, bookkeeping, VAT returns?
• Am I in need of tax advice and financial forecasts?
• Am I in a position to grow my business?

5. Ensure they help you meet current legislation

Businesses must comply with current laws and legislation. A knowledgeable accountant will help your business comply with new laws, such as the government’s new Making Tax Digital legislation. For example:

• From 1 April 2019, VAT-registered businesses earning over a threshold of £85,000 must submit their financial records to the government digitally via an HMRC-recognised cloud accounting software. From 1 April 2020, MTD (Making Tax Digital) will also apply to other businesses who fall below this threshold.
• An accountant should be familiar with such software. Plus, they must also be knowledgeable about government compliance and keep your business out of legal trouble and prevents any fines.

6. Use your accountant efficiently

Delegate work that you cannot do yourself to make the most out of their expertise. Talk to them about tax advice and how your business can legally save money. Avoid using them for simple data-entry tasks.

7. Calibrate the costs

• Ask for written quotes from potential candidates.
• Consider your preferred method of payment: some charge hourly while others charge a monthly retainer.
• Negotiate and settle the fee in writing.

Berley is your ideal small business accountant

At Berley, we are London’s chartered accountants for small businesses and we have a proven track record of assisting SMEs and start-ups with their financial matters.

If you are struggling to keep on top of your finances, our team of specialist small business accountants are here to help make your business financially stable. Whether employed on a full-time basis or merely for an afternoon – speak with one of our specialist accountants today and see how we can help your business. Give us a call on or fill up a simple form on our Contact us page.

If you found this interesting, take a look at:

• Can Artificial Intelligence help my small business?
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This post is intended to provide information of general interest about current business/ accounting issues. It should not replace professional advice tailored to your specific circumstances.