I was thinking the other day, that some of our best clients have come from previous accountants. I found this peculiar. If we are having such a great working relationship with them, what made them switch? What didn’t work before?
Unlike your utilities, where we’re being encouraged to search and switch for the best deals, appointing your accountant isn’t quite like that. I’ve not encountered a single business owner who has done that sort of switching with their accountant. When businesses appoint an accountant, they want to stick with them for quite some time.
So why do people change? What goes wrong?
Here’s a clue. It isn’t price. Price changes are a symptom of something else.
That something else, is a misalignment of expectations. You have a business owner, with their goals, challenges, personal and professional needs. Then you have an accountant, with their value proposition, approach, technical expertise and principles. When those things align, you will grow to love your accountant (and they will love you!). But if there is a misalignment somewhere, then the cracks can show and that’s what drives a switch.
In this blog, I am going to explore three common mistakes made when businesses pick accountants.
By the way, even if you have an accountant today, this is still a worthwhile read. Are they aligned to you? If not, it might be worth a chat.
Your accountant is misaligned to you and your business
This, for me, is the most important issue. If you are aligned in how you expect to interact, you’ll be drawn together as a superb partnership. If not, the relationship will become strenuous or underwhelming.
A limited company and its owner can be wildly different from one another. Some companies have turnover in the millions, dozens of employees and multiple products. Other companies are simply a means to an end.
Business owners looking to grow and expand need to lean on their accountant. Their accountant must be their trusted advisor.
Whereas other business owners may simply want to speak to their accountant twice a year. First to pass on the records, then know what the tax is.
Both ways are fine, but make sure your accountant is thinks and works like you do.
Most accounting websites today will say a ‘bespoke service’ or a ‘tailored service’ and similar clichés. That’s true – it has to be, as no business is the same. But accountants don’t tailor how they work. They have a fixed method and approach. So set expectations up front.
If you’re a once-a-year person, tell them. It’s for them then to accept or decline your custom. Or if you want a trusted advisor and business partner, then make it clear, even if it’s literally clarifying how many meetings a year you need, or what reporting you want.
Your accountant doesn’t understand you and your business
Slightly different wording here. It’s more about understanding what your business does, versus how you operate. Think industry and sector, opposed to the process and values.
Here’s an example. We don’t typically work with those in the creative industry. It’s nothing personal, but just that we feel we wouldn’t be offering the right service. The tax reliefs, the challenges in the industry and all these nuances that an accountant who doesn’t ‘get’ your sector is overlooking. It could cost you time and money.
Conversely, we’re open arms for tradespeople and construction businesses. We have the software, the knowledge and expertise for construction clients. An accountant specialising with creatives, might not even know what the construction industry scheme is, let alone be able to account for it.
With remote working and cloud technology, you shouldn’t be afraid to look beyond your postcode to find a right accountant. Face-to-face is good, but getting the best support is what it’s really about. As much we love meeting, it’s not all about the coffees, but doing a great job.
Some industries are not so sector sensitive for sure but do your research. Is there a specialist out there for you?
Your accountant is not providing you the right service
This is one area whereas the client, you need to sit and think what you really need.
Say you run a Limited Company. You just want those accounts done, filed and want to know your tax for a year and get on with other things. You’ll say you need accounts prepared and you’ll provide a bag of receipts. Is that just a set of accounts, or bookkeeping needed to?
What if you’re trying to grow a big business? Is the once-a-year accounts production service you have enough?
This is all about getting what you need. And your accountant shouldn’t be afraid to challenge you if they feel different. Get this wrong and you become misaligned in what to expect.
If you’re wanting the simple service, are quarterly catch-up calls going to help you, or annoy you? If you’re the ambitious business owner, are you yearning for management accounts?
The price point
Guess what – these points not aligning are what drives the wrong prices. If you’re paying for the wrong services, paying for the type of accountant you don’t need, or paying for an accountant who has to spend copious hours researching your sector, you are paying the wrong amount.
It could be too much, with bells and whistles you don’t need, or time to research legislation. Or too little, with the accountant become disgruntled over the fee (and inevitably and unexpectedly raising it).
How can you avoid these mistakes?
First, reflect on your business, what you want now and what you might want in the future. Will your simple operation turn complex? Or is it going to be the same for years to come? How about support and advice? Sector? Services?
Don’t be afraid to look around. Like how we work with clients from Essex to Wales, your perfect accountant may not be on your doorstep. Do your research.
Finally, before putting pen to paper, explore these points with the accountant. Get frank answers from them. Do they understand your industry? Have they “been there, done that and got the T-shirt”?
Are you misaligned with your accountant? Or need some advice before appointing your first? Get in touch to see if we’re a perfect fit.