How to hire an accountant that fits your company (and budget)

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Small business owners are often great at multitasking. But handling finances can become overwhelming in no time — even the tiniest financial recordkeeping mistakes can result in a headache. A certified public accountant can tidy up your finances in a big way and even help you during tax time. But needing an accountant and knowing how to hire an accountant are two very different things.

Hiring an accountant is an in-depth process that requires several steps. But before you start your search, it's essential to understand what an accountant does, and whether your business truly needs one.

What does an accountant do?

When you run your own business, you're responsible for a lot: day-to-day operations, hiring, developing a business plan, balancing the budget, and more. An accountant specializes in finances, providing financial analysis and planning, tax advice, and even help with preparing tax returns.

Accountants are often confused with bookkeepers. While accountants tend to have the financial knowledge required for bookkeeping, accountants provide a more strategic analysis of your business. 

Accountants will analyze your finances to look for areas of improvement, finding ways to boost your cash flow. Accountants are also up to speed on tax laws, allowing them to properly assess your tax situation. They can identify potential tax deductions, and ensure you're in tax compliance with the IRS. A good accountant will help you have a smoother, more productive tax season.

​Accountants ultimately help businesses get the most out of their taxes and run a financially sound ship the rest of the year.

Does every business need an accountant?

Unless you were an accountant in a previous life, you likely need a certified public accountant. Or, you need some level of a financial advisor on retainer. Either way, your startup should have accounting help, even part-time or ad hoc.

Accountants are worth the cost for their tax planning assistance alone. In many cases, they'll help you find numerous deductions you never knew about. Their tax knowledge, coupled with the financial planning they bring to the table, will likely help your business in the short and long term. 

While having an accountant is ideal, we recognize that not every business can afford one right now. Fortunately, there are other ways you can keep your finances in order without an accountant. (More on this later.)

How to hire an accountant for your small business

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Having an accountant can benefit your company in many ways, even if they’re part-time or on retainer. That said, knowing how to hire an account isn't as simple as finding a freelancer online. To increase your chances of finding a good accountant, follow these steps before, during, and after hiring:

1. Identify your needs

The first step in hiring an accountant is identifying what level of financial help you need. Review your financial records and cash flow to see what state they're in. If you're having serious cash flow problems, you likely need a full-time accountant. If you're in a good spot with your finances and mostly need help preparing for tax season, a part-time accountant who specializes in taxes is a good choice.

You also want to take note of any industry-related problems. For example, if you're new to an industry and struggling to make your business model work, an accountant with relevant industry experience may have knowledge and insights to help you.

2. Determine if you need full-time or part-time accounting

You likely know if you need a full-time accountant or part-time help once you complete the first step. Many companies get by with a part-time accountant. And, depending on your financial situation, you might only be able to afford a part-time accountant. This is still better than no accountant.

Part-time accountants often charge an hourly rate, allowing you to utilize their skills when needed. (For example, during tax time.) If you have an ongoing issue or know you'll need an accountant for a lengthy period — such as during a business overhaul or massive sale — a full-time accountant is a better fit.

3. Prepare interview questions

As part of your due diligence, identify which questions to ask during the interview process. Doing so will give you peace of mind that any candidates you interview are who they say they are. Some important questions to include are:

  • Describe a time where you made an accounting or financial mistake. How did you correct the situation?
  • What's the biggest challenge you've overcome as an accountant?
  • What kinds of accounting software are you comfortable using?
  • What types of financial reports do you commonly make?

You'll also want to include more personal or team-based questions that can help you determine if the person is a good fit with your company culture. Interview your accountant with specific skill-related questions, but also get to know them like you would anyone else.

4. Post a job or look for an accounting firm

There are a number of ways to find accountants, but few give you as much power as posting a job yourself. Pick a job platform, and be sure to follow job posting best practices. It can be a little daunting when hiring for your startup, so don't rush the process. There's also an alternative route to consider: accounting firms.

If you want a single accounting professional for your business, a firm may not be the best route. But for those needing accounting services and without a preference for an individual, an accounting firm is worth considering.

Accounting firms are what they sound like: companies with multiple accountants who can tackle various financial issues. Accounting firms offer a bit of what a full-time accountant does, in that you get as much help as you need. But they also bring with them the freedom a part-time accountant offers. In other words, you can pay for the services as needed – with the caveat that there's sometimes a retainer fee.

5. Onboard your accountant

Your work isn't over once you've hired an accountant — you now need to onboard them. The level of onboarding can vary depending on the accountant's experience. If you hired a seasoned veteran with experience in your particular industry, your onboarding will likely consist of little more than teaching them about your company.

Still, you'll want to put a few guidelines in place during onboarding. First, determine how you plan on measuring your accountant's success, and ensure you're both on the same page. Then, have them meet with any department heads or employees they'll be working with. This is also a good time to lay down any communication rules and preferences. 

It's also vital to let your accountant know about any kind of reporting preferences here. The accountant will most likely know best practices, but if there's a certain report you're after, this is the perfect time to put it on their radar.

What to do if you can't afford an accountant

Don’t worry if you can't afford an accounting professional. Accounting software is a solid substitute for an accountant, and will help keep your financial information organized. The right accounting system should contain at least some of the following features:

  • Automated financial record keeping: Many types of accounting software automatically file your purchases under the correct type of spending, consolidate records, and take manual bookkeeping and accounting tasks off your plate. For example, QuickBooks can sync with certain point of sale systems and automatically categorize purchases under the right type of record.
  • The ability to generate financial reports: Along with automated record keeping, many accounting platforms automatically generate reports. For example, you can set your accounting software to create a customized report on the same day every month, saving you the time and trouble of doing so manually.
  • A mobile app: Accounting software with a mobile app ensures you can stay on top of your finances while on the move. This is especially important for small business owners, as you're likely to be traveling for expos, networking events, and supply runs.
  • Usability: General usability is a big one to look for in any accounting software. You and your team will be using this software to simplify your finances. Read user reviews, sign up for free trials, and watch demos of the software to see if it looks like the right fit for your skill level.

Accounting software isn't a full replacement for an accountant, but it can make your business finances far easier to manage. Take your time shopping around, utilize free trials where available, and don't ever feel that you're locked in.

Finding an accountant you can count on

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You've made it this far without an accountant. But think of how far you could go with a finance professional at your side. Your day is likely filled with more tasks than you can count. An accountant will remove a large chunk of your financial stress and give you the mental energy needed to drive your business forward.

Knowing how to hire an accountant includes thinking about your business needs, determining if a full-time hire is necessary, and asking the right questions when interviewing a candidate. Your search may take some time. But in the end, you'll hire an accountant you can truly count on.

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