Changing Accountants
Having an accountant can be invaluable if you are a business owner – not only will a good accountant save you money, but they will be able to highlight areas where your business can perform better – therefore helping to optimise performance.
Unfortunately, as with any line of work, there can be good accountants and bad accountants. We have put together some useful tips to help you identify whether your accountant is working for your business, or your business working for the accountant.
Five signs its time to change accountants
1. Your accountant is expensive. Whilst there is no doubt accountancy is a skilled profession and therefore there will be certain costs involved in employing one, it still should not cost you the Earth. Accountancy is a very competitive industry nowadays and therefore if you feel you pay too much, a simple online price comparison will be able to revel if you are paying too much or not. Ideally, you do not want to be paying for services you do not require – as such, you should look for something like a fixed-monthly subscription that does not feature any unnecessarily extended tie-ins.
2. You are being charged for everything. It is important that you and your accountant are clear on the details of your contract. Whilst you should not be expecting free advice all the time from your accountant – as a business owner you are likely to often have quick questions regarding related taxes etc. However, if you find yourself being invoiced for every little question you ask – it may be time to look for an accountant that is a little more generous with their time.
3. You need to book an appointment. If you are still required to book an appointment with your accountant and then take time out of your busy schedule to then go and see them in person, it may be time to consider an online accountant. There is no denying that technology has changed the way business is now done for many, and the convenience and cost-savings that an online accountant can bring a business are hard to ignore. Enabling you to check your accounts and ask questions from any location, the time savings and convenience alone make online accounting a very attractive proposition for businesses, particularly smaller-sized ones that are trying to keep costs down.
4. You don’t understand your accountant. As with many industries, accountancy is guilty of featuring a lot of technical jargon. Whilst it is, of course, great if you can understand this, if you do not, it can lead to confusion and possible mistakes being made. If your accountant does not clearly explain everything to you in a way that you understand, it may be time to seek one that does.
5. Still using complicated spreadsheets. Just the thought alone of an accounting spreadsheet can be enough for some people to break out into a sweat. Often featuring complicated formula, extensive information and the constant need for precision, many people often find themselves making mistakes that then need to be retraced and done again. Online accountancy eliminates this by making the entire process straightforward and enabling you to effortlessly revise figures should you need to.
Switching accountants
Switching accountants may seem like a daunting task – particularly for businesses that have used the same accountant for a long time. It is understandable that many businesses would be reluctant to make such a change, worried of any possible consequences and damage to their business in the process. Furthermore, the actual process of collecting all of your financial information and then handing it over to a new accountant also prevents many from pushing forward with a switch. However, the process can and should be relatively straightforward as long as certain procedures are followed and documents produced. To begin with, you must check your terms and conditions with your existing accountant regarding what if any notice period you need to provide them. Regardless of what kind of notice period you are required to provide, it is only common courtesy to prewarn them of your intention to leave.
Once you have selected your new accountant, they should be able to help you make the switch. They can simplify and speed up the process by sending your old accountant a Professional Clearance Letter requesting they hand over all relevant documents pertaining to your business. However, as long as your accountant is registered with a professional body, they are required to provide this information freely – letter or not.
What information to get from your old accountant
Your accountant will have a lot of sensitive financial information critical to your business and to ensure not is lost or overlooked, it is vital that you get everything you can to make the switch as smooth as possible. Whilst your old accountant should know what you need and be able to easily provide it, it is useful to know what you are looking for so that you can check yourself should any problems arise. This information includes:
- All financial statements, including Year Ends and detailed profit and loss accounts
- Information regarding all fixed assets, as well as details of all debtors, creditors and capital account movements
- Details of hire purchases and any finance lease agreements – including projected costs
- Bank reconciliation of all business-related accounts
- Financial details of current stock and ongoing work
- Corporation Tax calculations
- Copy of the latest CT600 to be submitted
- All information regarding your business’ future liability
- HMRC-issued Form CT620 for the most recent accounting period
- Confirmation of Disengagement from the old accountant
- All other related documentation, such as those for PAYE scheme and PAYE Accounts Office
