How to Avoid Mistakes When Choosing an Accountant?
Every manager or founder of a business faces the necessity of selecting a reliable accounting firm or freelance accountant for their company’s accounting needs. The choices available are numerous. The more options there are, the harder it is to choose just one. “Experienced” individuals advise relying on recommendations from trusted partners in such cases. Sometimes, personal feelings will also indicate whether it will be comfortable to work with a particular partner.
Here, we will not discuss collaboration with an in-house chief accountant, as we will assume that those who understand the advantages of outsourcing in accounting are the ones reading this article.
In this article, we will outline the main principles you should follow when choosing an accountant for your business on an outsourcing basis, and you will receive additional advice from a specialist who has worked in the field of providing outsourced accounting services for over 10 years. Guided by this advice, you will be able to make a professional choice of chief accountant for your company. After all, choosing an accountant is sometimes equivalent to choosing a spouse.
However, there isn’t much time for getting to know and communicating with a partner.
Choice – Firm or Freelance Accountant?
Both options are valid, and each has its advantages and disadvantages.
So, what questions should you discuss with your potential partner accounting firm?
Type of Contract and Duration of Services:
- Is this a contract for a one-time accounting service or for ongoing accounting support based on long-term cooperation?
- What is the duration of the contract?
- What are the termination conditions of the contract?
- What are the obligations of the parties upon termination of the contract?
- What are the responsibilities of the parties after the contract is terminated?
Scope and Types of Accounting Services:
- Full accounting and tax reporting from processing primary documents to calculating financial results and taxes, preparing and submitting reports to all authorities.
- Performing specific functions in your company’s accounting system, such as the chief accountant’s duties to check the accuracy of processing primary documents in the program, forming financial results, calculating taxes, preparing and submitting reports, or maintaining separate areas of accounting.
- Preparing reports solely based on the information (numbers) you provide.
- Preparing documents and reports based on the data you provide while simultaneously verifying their accuracy and compliance with legal requirements and correctness in accounting.
- Processing finished primary documents in the program, forming financial results, preparing references.
- Creating and processing finished primary documents in the program, forming financial results, preparing necessary documents and reports.
Service Costs (Unit Price of Service, Time Spent by Accountant):
The price of accounting services is determined by:
- Subscription fee;
- Monthly fees and additional payments calculated based on the volume of services actually provided and the rate for the cost of a unit of service or spent time;
- Arbitrary payment, which depends on the fact of service provision and its price.
What Information About Service Prices is Fixed in the Contract?
- Are the rates for accounting service costs standardized for all clients, or is the price negotiated individually with each client?
- What rates for a unit of service or the cost of 1 hour of work for a specialist does the contractor apply?
- How is the time spent by the accountant on providing a specific service calculated? Is it based on actual time, or does the contractor have standardized rates?
- Can the price of accounting services change, and what is this based on?
That’s enough advice for today.
Wishing everyone success in this challenging task – to choose a true chief accountant for your company!
