Choosing your accounting firm is an important decision and can affect the growth and success of your business.
There a number of different things you should take into consideration when making this decision.
Quick 3 Checklist:
- How available are they to help you?
- How up to date is their knowledge?
- Are they qualified?
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Let’s investigate why each of these things are important when you are looking for a new accountant;
How available is help and assistance?
This might seem like a no-brainer – but think about it! Are you relying on a single accountant – or is this accountant supported by a team of accountants?
Accountants sell time – the better your accountant is, the more likely other people think so too, and the less available your accountant will be.
If your accounting firm has a team of good accountants behind them, you will find that help can be immediately available rather than if you are relying on a single accountant.
A team of accountants you can rely on lets you have access to information for the bank within minutes.
Your BAS can be PDF’d or lodged for you when you need it. Got a question? More than likely someone can help you on the spot.
You won’t need to wait for a return phone call which could be hours away, for something that is important to keeping your business moving now.
There is a saying – you don’t know what you don’t know.
How true this is for accountants!
Although you might only see the tax return and financial statements your accountants prepare for you, there is a lot of tax law and knowledge that should go into the preparation of your work.
Australian Tax law changes at a fast pace – especially around areas like Self-managed Superannuation.
How up to date is the knowledge of your accountant? How regularly are they reviewing decisions being made by the ATO? How regularly are your accountants – and their team – attending training?
The ATO will hold you, as the tax payer, responsible for errors in your tax return.
In fact, when you sign to say that your accountant can lodge your tax return – you are also signing to say your tax return is correct. If the ATO uncover errors in your return they can fine you between 50-100% as a penalty and then charge you with interest on top of that.
Save yourself the trouble – and ask your accountant how regularly they attend training.
Is Your Accounting Firm Qualified?
The qualifications of your accountant affect how the outside world view your financial statements and tax returns.
A bank will be more confident if your financial statements and tax return were prepared by a Chartered Accountant than an accountant with no qualifications at all.
This is also the case if you are trying to sell your business – or trying to attract an investor to your business.
In the accounting world qualifications do matter. Accountants can tell a lot about another accountant by their qualification – but if you are not in the industry it would be easy to think they are all much the same. To make it easy for you I will break down the main professional affiliations for you:
|Qualification||Graduate Diploma||Bachelor Degree||Compulsory CPE Hours||GAA|
|Chartered Accountant (CA)||Yes||Yes||120 hours/3 years||Yes|
|CPA||No||Yes||120 hours/3 years||No|
|Institute of Public Accountants (IPA)||No||No||80 hours/2 years||No|
|Member of the Tax Institute||No||No||30 hours/year||No|
The Institute of Chartered Accountants are the only professional qualification that require each of their members to complete a Graduate Diploma. What this means is that Chartered Accountants complete a Bachelors Degree in either Business or Accounting and then complete a 2 year Graduate Diploma of Chartered Accountant which is at a level above third year Bachelor degree courses.
Both the Institute of Chartered Accountants and CPA’s are required to complete a Bachelor degree.
Compulsory Continued Professional Education are the hours that accountants are required to spend learning and keeping their knowledge up to date in order to keep their membership.
The GAA – or Global Accounting Alliance – is the international accounting body made up the top 10 accounting bodies – including the American CPA’s (same letters as Australian CPA’s – but not the same). Together these accounting bodies work together to create international standards of reporting and come up with solutions to deal with international accounting issues.
When considering a new central coast accountant – ask about their qualifications– and specifically ask them how they are keeping up with changes to tax law.