Once you have decided upon starting a new business it is crucial that you enlist the services of a professional accountant. Ideally, arrange this even before you commence trading.
What they should provide for you
Good accountants should not only be able to prepare accounts,but also offer you advice on all areas of your business. This could include:
* whether to set up the business as a sole trader, partnership or limited company
* assistance on registering for VAT and preparing the necessary returns
* which would be the ideal system to use to keep all your business records and details
* help produce business plans and guidance on raising any finance if needed
* offer input into preparation of the cash-flow predictions for your new business
* guidance on setting the correct profit margins to help the business trade profitably
* advise on any type of legislation that relates to your new business
* if wanted provide a total payroll service for you and your employees
* tax advice on all general matters
* audit service if needed
* verifying accounts of another existing business that you are considering purchasing
Checklist from Accountants in Cambridge to help you with your selection
These are some important points to consider when making your selection:
1. Check their qualifications. You want to make sure they are a member of one of the three main professional bodies, which are:
* the Association of Chartered Certified Accountants (ACCA)
* the Chartered Institute of Management Accountants (CIMA)
* the Institute of Chartered Accountants in England & Wales (ICAEW)
2. Normally a good starting point is to seek personal recommendations, perhaps from a friend with an existing business or even your bank manager
3. Meet with two or three different accountants before making your final decision
4. In most cases the first meeting should incur no charges but check beforehand
5. Ask their permission to approach some of their existing customers for references
6. Situated locally - will obviously make meetings more convenient
7. Preferably they are dealing with companies similar to the size of your business
8. How familiar are they with the business sector you are entering?
9. How many partners are involved in the practice and who would be handling your business affairs? Arrange to meet this individual to ensure you feel comfortable with them
10. An accountant who is used to dealing with businesses that are similar in both size and complexity of your own business would be an ideal appointment
11. How good are they of keeping clients informed and up to date? Do they issue reminders to their clients regarding any forthcoming returns that may be due?
12. Determine what their fees are and how they levy their charges. A large number of accountants do charge by the hour, however because initially you are a small business, most should be willing to agree a fixed annual fee with you
13. Normally by keeping good records, perhaps on Excel files or a software package, makes it easier for your accountant to process. In turn this should help keep their fees down
14. Consider approaching them to see what their charges regarding your personal tax matters would be. This makes perfect sense as they would already be looking after your business affairs
Letter of Engagement
Once you have chosen your accountant then they should prepare the terms of the relationship in a 'Letter of Engagement'. This will be issued to you and contains the terms of the relationship between you and your accountant.
All good relationships require regular and open communication with one another. A good accountant should be informing you in advance when returns of some type are due. This could be quarterly VAT returns or end of the financial year.
Equally, it is your responsibility to keep good financial records. To update your accountant with any changes to your business and make sure you have all the relevant information readily available for them when needed.
Occasionally, review your relationship with your accountant to check you feel you are still receiving good value for your fees. Are they still responsive to your business needs? Has your business outgrown them or vice versa?
I hope that by following these Accountants in Cambridge guidelines, it will help you in choosing an accountant that you feel comfortable with looking after your business affairs. If you find after a while that is not the case, then I would strongly recommend going through the same selection criteria as before. With a good accountant on board, there is nothing more reassuring than knowing your tax affairs are in safe hands.
What they should provide for you
Good accountants should not only be able to prepare accounts,but also offer you advice on all areas of your business. This could include:
* whether to set up the business as a sole trader, partnership or limited company
* assistance on registering for VAT and preparing the necessary returns
* which would be the ideal system to use to keep all your business records and details
* help produce business plans and guidance on raising any finance if needed
* offer input into preparation of the cash-flow predictions for your new business
* guidance on setting the correct profit margins to help the business trade profitably
* advise on any type of legislation that relates to your new business
* if wanted provide a total payroll service for you and your employees
* tax advice on all general matters
* audit service if needed
* verifying accounts of another existing business that you are considering purchasing
Checklist from Accountants in Cambridge to help you with your selection
These are some important points to consider when making your selection:
1. Check their qualifications. You want to make sure they are a member of one of the three main professional bodies, which are:
* the Association of Chartered Certified Accountants (ACCA)
* the Chartered Institute of Management Accountants (CIMA)
* the Institute of Chartered Accountants in England & Wales (ICAEW)
2. Normally a good starting point is to seek personal recommendations, perhaps from a friend with an existing business or even your bank manager
3. Meet with two or three different accountants before making your final decision
4. In most cases the first meeting should incur no charges but check beforehand
5. Ask their permission to approach some of their existing customers for references
6. Situated locally - will obviously make meetings more convenient
7. Preferably they are dealing with companies similar to the size of your business
8. How familiar are they with the business sector you are entering?
9. How many partners are involved in the practice and who would be handling your business affairs? Arrange to meet this individual to ensure you feel comfortable with them
10. An accountant who is used to dealing with businesses that are similar in both size and complexity of your own business would be an ideal appointment
11. How good are they of keeping clients informed and up to date? Do they issue reminders to their clients regarding any forthcoming returns that may be due?
12. Determine what their fees are and how they levy their charges. A large number of accountants do charge by the hour, however because initially you are a small business, most should be willing to agree a fixed annual fee with you
13. Normally by keeping good records, perhaps on Excel files or a software package, makes it easier for your accountant to process. In turn this should help keep their fees down
14. Consider approaching them to see what their charges regarding your personal tax matters would be. This makes perfect sense as they would already be looking after your business affairs
Letter of Engagement
Once you have chosen your accountant then they should prepare the terms of the relationship in a 'Letter of Engagement'. This will be issued to you and contains the terms of the relationship between you and your accountant.
All good relationships require regular and open communication with one another. A good accountant should be informing you in advance when returns of some type are due. This could be quarterly VAT returns or end of the financial year.
Equally, it is your responsibility to keep good financial records. To update your accountant with any changes to your business and make sure you have all the relevant information readily available for them when needed.
Occasionally, review your relationship with your accountant to check you feel you are still receiving good value for your fees. Are they still responsive to your business needs? Has your business outgrown them or vice versa?
I hope that by following these Accountants in Cambridge guidelines, it will help you in choosing an accountant that you feel comfortable with looking after your business affairs. If you find after a while that is not the case, then I would strongly recommend going through the same selection criteria as before. With a good accountant on board, there is nothing more reassuring than knowing your tax affairs are in safe hands.
About the Author:
Oliver Lamarsh has been a professional accountant, based in Cambridge, for more than 25 years and we hope you found his guide useful. Join Oliver at www.accountantsincambridge.com where you can find more details on how he may help you with your business or personal financial matters.