The One Thing You Need to Know Before Hiring an Accountant for Your Small Business

If you run a small business in Australia, you know how important it is to have a reliable and competent accountant by your side. Accounting is not just about crunching numbers and filing tax returns. It’s also about helping you make informed decisions, optimise your cash flow, plan for the future and avoid costly mistakes.

But not all accountants are created equal. Some may be more qualified, experienced and knowledgeable than others. Some may be more suited to your specific industry, business model and goals. And some may be more responsive, proactive and supportive than others.

That’s why, before you hire an accountant for your small business, there is one thing you need to know: their specialisation. This article will explain what specialisation means in the context of accounting services, why it matters for small businesses, and how to find and choose an accountant who specialises or has experience in your business needs.

Meet Bob a successful e-commerce store owner who learnt this the hard way. He hired an accountant who was recommended by a friend but soon realised that they had no clue about the online world. They didn’t understand how to deal with proper Xero integration, cross-border payments, correct corporate structures, and what to do when the business grew beyond 6 figures.

That’s when he decided to look for an accountant who understands e-commerce accounting. He found an e-commerce accountant who did a complete restructuring of his business to mitigate and reduce his personal liability and risks. The accountant also created a structure to align with his long-term investment and family goals. Along with this came huge tax savings and projected tax savings as the accountant devised a 5-year plan. Finally, with the accountant’s expert knowledge, he was able to save on cross-border transaction fees and get a growth pathway to save thousands on delivery costs. He moved from a drop shipping model to a third-party logistic model in 3 major regions where most of his sales occurred. His business is now thriving with a higher top and bottom line.

That’s the difference that specialisation can make, and why it is important to work with an accountant or team of accountants that have helped clients in similar industries.

What is specialisation in accounting services?

Specialisation in accounting services means that an accountant has a specific focus or expertise in a certain area of accounting or a certain industry. For example, some accountants may specialise in bookkeeping and payroll, while others may specialise in taxation and BAS. Some accountants may specialise in business advisory and planning, while others may specialise in forensic accounting and fraud investigation. And some accountants may specialise in industry-specific accounting, such as e-commerce, construction, hospitality, etc.

Specialisation is not the same as generalisation. A generalist accountant may be able to provide a range of accounting services to a variety of clients, but they may not have the depth of knowledge, experience and skills that a specialist accountant has. A specialist accountant may be able to provide more tailored, efficient and effective solutions to your specific accounting and business needs.

Specialisation is also not the same as certification. A certified accountant may have completed certain qualifications and training to become a member of a professional body, such as CPA Australia or Chartered Accountants Australia and New Zealand. But certification does not necessarily mean that an accountant has a specialisation in a particular area or industry. A certified accountant may still be a generalist or a specialist, depending on their background, interests and clientele.

Also, to note depending on the size of the firm they have multiple angles of expertise thus multiple specialisations across their management team. For example, an accounting firm may have one person from their team specialising in self-Managed Superfunds and another person may have a lot of builder and tradie clients so they can work together and help your trade and construction business whilst also assisting you to build your retirement wealth in a self-managed superfund.

Why does specialisation matter for small businesses?

Specialisation matters for small businesses because it can make a big difference in the quality, efficiency and value of the accounting services you receive. Here are some of the benefits of hiring an accountant who specialises in your business needs:

• Compliance: A specialist accountant can help you comply with the complex and ever-changing accounting and tax laws and regulations that apply to your business. They can also help you avoid penalties, fines and audits that can result from non-compliance. For example, if you run a construction business, you may need an accountant who specialises in construction accounting and understands the specific rules and requirements for GST, income tax, payroll tax, superannuation, contractors, etc.
• Efficiency: A specialist accountant can help you streamline your accounting and bookkeeping processes and systems, saving you time and money. They can also help you automate and integrate your accounting software and tools with your other business applications, such as your CRM, inventory, POS, etc. For example, if you run an e-commerce business, you may need an accountant who specialises in e-commerce accounting and knows how to use platforms like Shopify, WooCommerce, Xero, etc.
• Value: A specialist accountant can help you maximise your profits and minimise your costs by providing accurate and timely financial reports and analyses. They can also help you identify opportunities and risks for your business and advise you on the best strategies and actions to take. For example, if you run a hospitality business, you may need an accountant who specialises in hospitality accounting and can help you with budgeting, forecasting, cash flow management, pricing, menu costing, etc.

How to find and choose an accountant who specialises in your business needs?

Finding and choosing an accountant who specialises in your business needs may seem like a daunting task, but it doesn’t have to be. Here are some tips to help you with the process:

• Ask for recommendations: One of the best ways to find a good accountant is to ask for referrals from people you know and trust, such as your friends, family, colleagues, mentors, suppliers, customers, etc. They may have worked with or know of an accountant who specialises in your industry or area of need and can vouch for their quality and reliability. You can also ask for recommendations from social media, groups or networks that are relevant to your business or industry.
• Check their qualifications, registration and membership: Once you have a list of potential accountants, you should check their credentials and background. Make sure they have the relevant qualifications and training to provide the accounting services you need. Also make sure they are registered with the Tax Practitioners Board (TPB) as a registered tax agent or BAS agent, as this is a legal requirement for anyone who provides tax or BAS services in Australia. Additionally, check if they are a member of a professional body, such as CPA Australia or Chartered Accountants Australia and New Zealand, as this indicates that they adhere to high standards of ethics and professionalism. You can also check out their Xero directory which will give you an insight into what industries they look after as this data is taken directly from the Xero subscriptions they manage.
• Review their services, fees and client testimonials: Another important step is to review the services, fees and client testimonials of the accountants you are considering. Look at their website, social media pages, brochures, etc. and see what kind of accounting services they offer and how they charge for them. Compare their fees with other accountants generally the more specialised and more value an accountant can offer you the more they will charge. The biggest mistake you can make in your business is to go for a cheap accountant. Also, look at their client testimonials and reviews and see what their existing or past clients have to say about their work quality, communication, responsiveness, etc.
• Ask them relevant questions: The final step is to contact the accountants you are interested in and ask them some relevant questions to assess their suitability for your business. Some of the questions you may want to ask are:
  • How long have you been in business and how many clients do you have?
  • What is your specialisation and how did you develop it?
  • How familiar are you with my industry and business model?
  • What accounting software and tools do you use and recommend?
  • How do you communicate with your clients and how often?
  • How do you handle deadlines, errors and disputes?
  • How do you keep up with the latest accounting and tax changes and trends?
  • How do you add value to your clients’ businesses beyond accounting?

Wrapping up

Hiring an accountant for your small business is a crucial decision that can have a significant impact on your success. But not just any accountant will do. You need an accountant who specialises in your industry and area of need, as this will ensure that you receive the best accounting services possible.

Specialisation in accounting services means that an accountant has a specific focus or expertise in a certain area of accounting or a certain industry. Specialisation matters for small businesses because it can help you comply with complex and ever-changing accounting and tax laws and regulations, streamline your accounting and bookkeeping processes and systems, maximise your profits and minimise your costs and taxes.

To find and choose an accountant who specialises in your business needs, you can follow these tips: ask for recommendations from people you know and trust, check their qualifications, registration and membership with professional bodies, review their services, fees and client testimonials, and ask them relevant questions about their experience, approach and availability.