Every business in the UK, regardless of size and type, needs the right team of professionals to achieve goals and manage success.
Some crucial business tasks are managing finances, meeting accounting standards, paying the right taxes, and improving revenue.
All these require choosing the right accountant according to business needs.
A good accountant can provide the invaluable services and expertise required to run a business successfully at every stage of business development.
However, this can be challenging if it’s your first time, but this guide will help you ease the process.
Table of contents
- How do you choose the right accountant for your startup?
- Why do I need an accountant for my startup?
Accountants offer accounting and bookkeeping-related advice, tax solutions, audit guidance, and more to individuals and companies.
However, anyone with little accounting knowledge can call themselves accountants in the UK.
Therefore, you must carefully choose the right accountant for your business.
Here are 10 steps on how to hire an accountant for your startup.
1. Determine your business needs
Before looking for accounting services, you must determine your business’s current requirements.
For example, are you looking for a professional to manage your bookkeeping activities or provide strategic advice on tax preparation and financial reporting?
There are numerous other reasons why a startup may need an accountant, and you must identify yours.
Some of these include basic compliance, SEIS/ EIS registration, R&D tax credit preparation and filing, budgets and forecasts preparation, cashflow preparation and monitoring, payment processing, management accounts, virtual CFO, bookkeeping and so on…
2. Ask for referrals
Once you determine your accounting needs in business, start making a list of the best accountants.
You can ask people in your network or business associates for recommendations and referrals.
Challenge with a referral is a marketplace specialist accountant may not be best choice for a manufacturing business.
They can offer better insights into how the accountants perform in real life and help you identify reputable ones.
You can also ask professional organisations and local business communities for recommendations.
3. Research and evaluate candidates
Not every top accountant will have experience in your industry or suit your startup needs.
Therefore, researching each candidate is essential to understand their suitability.
You can visit their websites, read past client testimonials reviews, and access their qualification and expertise to make the best decisions.
4. Choose a candidate based on qualifications
Most startups rely on certified or chartered accountants for their business needs.
These accountants and bookkeepers usually hold a certificate from one of the professional bodies, ICAEW, AAT, or ACCA.
Alternatively, you can look for chartered accountants or chartered certified accountants.
They acquired additional knowledge, skills, and experience and underwent more rigorous training than certified accountants.
You can hire them mainly for higher positions like a CFO (Chief Financial Officer).
5. Check their expertise
Expertise is essential in offering professional accounting services and handling complex financial matters.
You must look out for their experience in your industry, how long the staff have worked as accountants and their past work details.
When you have all this information, making a decision will be easy.
6. Evaluate their skills and qualities
What skills and qualities are needed for an accountant to succeed in a startup? You must search for this answer before evaluating accountants.
Some of the top skills accountants must have are strong communication, data analysis and attention to detail, critical thinking, time management, problem-solving, teamwork, etc.
Besides these skills, they must have adequate knowledge of accounting standards, industry and general business knowledge, and efficient technical skills.
You can ask multiple questions to analyse their soft and hard skills as required in your startup.
7. Look into tech capabilities
Technology has a massive role in almost every industry, and accounting is no exception.
It automates repetitive manual tasks and saves accountants time for core services.
Therefore, it becomes essential to check how good an accountant’s technological capabilities are and what tools they presently use.
You must check if they’re using cloud-based accounting software.
These tools simplify financial management by offering real-time updates on your business cash flow and other finance-related information anywhere, anytime.
8. Ask for their services
One important aspect of hiring an accounting firm is asking them about services. Not necessarily all firms or individuals will offer you similar types of services.
Additionally, some firms even prepare a customisable package for clients depending on their needs.
Some common startup services include tax preparation, bookkeeping, creating business plans, fund sourcing, exit planning, audit support, etc.
9. Check and compare fees
How much will an accountant cost? This should be your first question while searching about accounting for startups.
Accounting fees significantly vary depending on an accountant’s experience levels, location, and service complexities.
Therefore, before hiring them, you must understand their fee structure and how it is calculated.
Some accountants charge you an hourly rate, while others may ask for a fixed fee for specific services.
You must also inquire about any additional charges that they might include later.
For example, if an accountant asks for £95 plus VAT per month retainer, ask what services are included.
10. Schedule an initial consultation
Once you have gathered all the necessary information about potential accountants, you must schedule an initial consultation.
This is a chance for you to ask them questions and determine if they are a good fit for your startup.
You might feel finding an accountant is time-consuming and expensive.
But having these professionals at your back can save you money and business in the long run.
Though not mandatory, hiring an accountant is a safe choice if you aren’t an expert in handling accounting and finance management.
They can save you by paying extra taxes, protecting you during HMRC investigations, getting funds from investors, reducing unnecessary cash flow, preventing fraud, and ensuring business success.
They also go beyond your basic financial tasks at times.
This includes helping you make more informed decisions by providing valuable insights depending on your financial analysis.
These professionals can assist you in managing cash flow effectively and ensure your startup has sufficient funds to meet its obligations and work on growth opportunities.
Furthermore, they help you with budgeting, financial forecasting and planning for long-term business success.
Accounting services are essential for startups as they manage your financial health and help you comply with laws and regulations.
Therefore, you must carefully choose an ideal accountant for your startup, and this guide will help you in the process.
Once you have hired the right fit expert for your company, make sure to develop a good working relationship with them.