For even the smallest business, choosing the right CPA (certified public accountant) can be a major step toward minimizing taxes and maximizing profits. Whether you're looking for a new CPA to better serve your business or contracting with an accountant for the first time, these five simple steps will help you select a CPA who matches your accounting needs.
Before you begin your search, decide what you're looking for in a CPA. Do you need bookkeeping functions provided? Are you looking for a CPA to simply prepare your year-end federal taxes or generate financial reports? Maybe you want an on-call advisor to help you make financial decisions. Knowing what you need will help you narrow the search for the right CPA.
Ask friends, professional associates and your other business advisors for names of CPAs. Surf the Internet. Many CPAs maintain Web pages that show an accountant's area of specialty and the types of accounting functions performed. If you belong to community or trade associations, look through membership directories for possible names.
Once you've found several names, make initial calls to arrange meetings with each candidate. Many CPAs offer free initial visits. But to be sure, simply ask over the telephone, "Will there be a charge for this first visit?"
Don't go to the initial meeting empty handed. To fully understand your accounting needs and the condition of your business, the CPA will most likely want to see some financial records. Take your most recent federal tax return, including all schedules and forms. Also take a copy of your general ledger and a current financial statement if available. Bank statements for the current year can also be useful.
The first meeting generally lasts about 30 minutes. This is the time to find out if you and the CPA make a good match, so don't be shy about asking questions. Look for someone who expresses an interest in your business and who understands the financial intricacies of your specific industry. Present your financial records and ask the accountant to briefly review them. As questions emerge, you'll begin to see how well the CPA understands your specific type of work. Ask about the accountant's experience with self-employed business owners. Tell the CPA exactly what accounting functions you need performed. If you feel comfortable talking to the CPA, and the accountant can translate complex financial lingo into easy-to-understand concepts, then you╒re getting close to finding the right advisor.
Don't leave that first meeting without asking about fees. Ask specifically how you will be billed. Is it an hourly rate? How are telephone calls billed? Are there steps you can take to save the CPA time and therefore help reduce your accounting costs?
Finally, ask the CPA for the names and telephone numbers of several clients who operate businesses similar to yours. Then call them. Ask those clients if the CPA delivers work on time and on budget. Find out if telephone calls are promptly returned. If your meeting with the CPA went well, and other clients seem to be satisfied, then chances are you've found the right CPA for your business.
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