01 Sep What to consider when appointing an accountant
Appointing an accountant is a huge decision when starting your business, you are putting your business finance in the hands of somebody that (in a lot of cases) you know nothing about. Here we consider some things to look for when researching an accountant:
Are they a member of a professional body?
To our disappointment, Accountancy is not a protected term in the same way as many professional services – as such, anybody can call themselves an accountant, irrespective of qualification.
The exams sat by qualified accountants are not easy, and whilst that wasn’t pleasant at the time, by virtue of the complexity of the qualification business owners can take some assurance that somebody that is qualified knows what they are talking about and that their business finances are in safe hands.
In order to maintain a qualification, accountants are expected to undertake continuous professional development each year in order to keep abreast of changes to standards or legislation.
Alchemy Accountancy is registered with the Association of Chartered Certified Accountants (ACCA), our registration number with the ACCA is 4355014.
Who owns the company?
Over the past few years there has been a lot of private equity investment within the accountancy industry. Whilst the availability of funding and new skills has the potential to help these businesses achieve more – sadly, the experience of many seems to suggest that it hasn’t worked out this way.
Private Equity backed businesses are usually funded with high levels of bank debt, usually with a high rate of interest (in view of the risk that is taken on), often leading to cost cutting exercises and the loss of key employees. Typically the companies will only be held for a short period of time before being sold on, incentivising management to make short-term decisions that will benefit the sale price for investors, rather than taking decisions that are for the benefit of clients. Due to their ownership structures, Private Equity backed practices typically will not be members by a professional accountancy body.
Alchemy Accountancy is owned by Craig McCall, Andrew Nixon and Alan Williams. Each of us has experience in successfully managing accountancy businesses, the business does not have any form of external funding (other than from shareholders) and is not owned with a view to a future sale.
Who will be doing your accounts?
There is a thriving industry in outsourcing accountancy work to third parties, often situated abroad. Whilst this may work well for some, we think that knowledge of the client goes a long way to producing high quality work and fostering high quality relationships.
At Alchemy Accountancy, all of our client work is completed in-house, and will never be outsourced to any third party whatsoever.
Are they ready for Making Tax Digital?
Making Tax Digital is on its way, and ultimately will make it compulsory to file quarterly returns to HMRC via online software. This means that accountancy through spreadsheets and shoeboxes will be a thing of the past, but not all practices are geared up for this.
At Alchemy Accountancy, we have partnered with FreeAgent and Xero to assist clients with their book-keeping. We find that FreeAgent work well for small businesses, whereas Xero is more suitable for SMEs, where there are additional complications. We can advise you on which would be most suitable for your business.
If in doubt, we suggest calling round a few different practices, asking questions around the above and getting an idea of who you stand to be working with.