The right accountant can add value to your business by saving it time and money year after year. Here are 10 questions you should ask when choosing and accountant:
1. How long have they been providing accounting services?
A reputable firm will have a proven track record of providing quality tax & accounting services over many years. Be skeptical of those without the proper background.
2. How many years of experience do they have in preparing business & personal income tax returns?
The tax code is complicated, the more experienced your tax preparer is, the better off you will be. Be sure you are comfortable with the knowledge and experience of who is preparing your tax returns.
3. Do they have the proper licensing and expertise to represent you if your income tax returns are audited?
It is possible to use accountants who aren't licensed, but it’s an unwise business move. Bookkeeping, tax preparation and general financial management may not require a licensed preparer but you will almost certainly need one if your company grows to the point when you need a loan, decide to sell, or if you’re ever audited.
4. Do they have knowledge & experience in your particular industry?
It’s best if they have worked with businesses that operate in the same industry as yours as they will better understand the unique needs of your particular business.
5. Do they have references within your industry that you can contact?
Ask for at least 3 references that own businesses in the same industry as yours and contact them to ask how long they have worked with the accountant and how their experience has been working with them.
6. Will they review your past income tax returns at no charge?
It shouldn’t take much time for them to do a high-level review of your income tax returns to be sure they will be comfortable preparing them. Ask for feedback after they have reviewed the tax returns, hopefully they will be able to identify tax saving opportunities.
7. Does their technology make it easy to do business with them?
Firms with the right technology and who specialize in your industry are able to put their skills to work for you no matter where you are located. 24/7 online and mobile access to key documents and other features should be offered.
8. How can they assist with tax planning?
Some accountants will do little more than manage your books and complete your tax return forms, but the best accountants are more on the proactive side. So before choosing an accountant, ask what they could suggest to save your business money. Be very careful about this, because ultimately it's you, the business owner, who'll pay the penalty if the law is broken.
9. Do they provide a written agreement stating the services they will provide and the associated fees?
Be skeptical of those that don’t as it is standard practice in the accounting industry to provide clients with an engagement letter that identifies the scope of the services to be offered and the fees for those services.
10. How do they charge for their services?
Many firms bill hourly but fixed fee billing is becoming increasingly popular. Some firms even bundle key services into packages and charge a fixed monthly fee.
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