(Originally posted on June 6, 2016)

 

The Most Valuable Asset Your Business has – Your Accountant!

 

Whether your business is just starting out or you have been operating for 20 years, your accountant is one of the most important members of your team.

A good accountant can assist you in making business decisions, developing business plans and tax planning. They can work with you to obtain financing, control labour costs, monitor your gross margin and protect you from government related (tax) issues; all improving your bottom line.

Choosing the right accountant can, however, be a difficult task as anyone can use the term ‘accountant’.

CRA has many times rendered rulings against business owners for having ‘inexperienced’ and ‘unqualified’ accountants and bookkeepers. In fact, one recent case saw a Tax Court of Canada Justice State:

“Mr. A. as the business owner, did not exercise diligence in hiring his spouse to perform the accounting and bookkeeping tasks of the business, therefore, we find Mr. A. liable for the taxes, interest, and penalties as assessed”

This may be an extreme case, but the point is:

The business owner is almost always liable and accountable for the financial affairs of the business.

With so many choices, how do you go about choosing an accounting professional that best meets the needs for your business?


Start by talking to people you know and trust – your lawyer, your banker, realtor and other business owners that you deal with. Ask who they use and why. Ask how they have assisted with their business, do they provide good advice? Are they reliable? Do they respond to questions in a timely manner?

Remember, just because your books may be ‘up to date’ does not mean they are accurate.

Once you have made a short list of potential accountants, make appointments with them – investing some time today could save you a great deal of grief down the road. Most accountants will offer you a free initial consultation; you can ask them about their qualifications, experience and clients. If they are reluctant to answer your questions, move on. Additionally, as you will be working closely with this individual, make sure there is a good personality fit.

Another item for you to consider is the range of services offered by the accountant; many specialize in one or two areas and that may not be enough for your business.

Does the accountant offer bookkeeping services? Payroll Services? GST/ HST filing? Do you need assistance with budgeting and cash-flow planning? You do not want to have to engage the services of multiple people to meet the needs of your business.

Having more that one person to assist you to manage the financial requirements of your business provides you with little benefit and you will waste time (and money) trying to communicate your needs and information to several parties.

What about communication? Does your accountant speak to you in a clear, concise manner? Do you understand the message that they are trying to deliver?

Finally, do not choose your accountant based upon price! The $100 you save today could cost you thousands of dollars down the road.

As you can see, there are a great deal of considerations when choosing the financial professional to assist you in your business, take your time and find the right partner for your business.
Ledgers, the one-stop location for all of the financial requirements of your business.