Accounting for change
Most accounting firms will say they understand the needs of small enterprises. Fortunately, there are a number of steps you can take to determine just how well placed an accountant really is to help you address the challenges your business faces.
Most of us are averse to change, particularly when it involves making decisions about people we have known for some time. If you have been in business for a while, chances are you have got to know your accountant pretty well and trust them to do a good job.
Even when this is not the case, it can be daunting to move away from someone who probably knows more about your financial affairs than anyone else. The thought of having to start again can be enough to make time-strapped small business owners think twice.
The cost of doing nothing
As we have discussed in previous blogs, the perception of an accountant as a bean-counter is increasingly dated. Progressive accountants are as much business advisers as financial advisers and many have the skills required to become successful entrepreneurs in their own right.
A good accountant will give you honest, constructive advice. If they have experience working with companies in your industry or at a similar stage of development they will also draw on that experience to help you avoid common mistakes.
If your perception of your accountant is of a necessary compliance burden rather than a trusted advisor who can add value to your business, it might be time to start working with someone else.
No need for like-minds
Some entrepreneurs say they prefer working with accountants whose minds work the same way, who have the ability to ‘think outside of the box’. But in the same way that part of the job of a chief financial officer is to keep the boss in check, an accountant needs to work in a logical way and is therefore going to be more risk averse.
Entrepreneurs are blue-sky thinkers – they might have 100 bad ideas for every one great idea. An accountant who thinks like an entrepreneur won’t get excited about preparing a set of accounts or a tax return, even though these remain vital tasks.
There is also the question of scale. You might feel more comfortable working with a sole practitioner during the start-up phase of your business, but what happens if you experience rapid growth – will your accountant be able to handle the increased volume and complexity of work?
Looking to the future
In the same way that you need to future proof your relationship with your accountant, you also need to make sure your accounting package will be up to the job. One of the advantages of using a cloud-based accounting solution such as Big Red Cloud is its scalability, but not all systems have the necessary functionality.
Every small business should make sure their accounting solution has a direct link with their bank that enables them to download all transactions quickly and easily.