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How To Change Accountant

How To Change Accountant

There can be many reasons why as a business owner, you may feel changing accountant is the right course of action. The process of changing accountants is actually a relatively simple one, contrary to what your current accountant may have you believe.

Before you think about changing, ask yourself these questions:

Am I getting value for money?

If you don’t feel like you’re getting the level of service you’re paying for this can be a cause for concern. Do some investigating and see whether you could get better value elsewhere before making any decisions.

Does my accountant understand the needs of my business?

It is critical that your accountant fully understands what you need from them and your plans for future growth. A simple misunderstanding such as being proactive in finding tax-saving opportunities for your business can result in a misalignment between both you and your accountant.

Are my returns filed in good order and on time?

As part of delivering a good service your accountant should always be ahead of deadlines and in contact with you in good time. Asking you to drop everything to rush through a tax return when deadline day is approaching is unacceptable. This distracts you from your work and, most importantly, growing your business.

Has my business outgrown my accountants?

Business growth is one of the biggest reasons to move on from your accountants. At the first sign that your accounts are getting too complex for your accountants to handle it’s time to look elsewhere.

Has my accountant outgrown me?

  • You’re beginning to feel like a number to a large firm of accountants
  • It seems that they simply do not have the time to deal with your enquiries
  • They are unapproachable and rarely available to handle urgent problems

Time to move on…

Finding your next accountant

Changing accountants shouldn’t be a rushed process, and research into finding the right accountant for you is key.

Here are a few ideas of what to look for:

  • Good customer testimonials
  • Deals with customers already in your sector
  • Transparent pricing
  • Helps with both personal and business goal setting

Finding an accountant that is at the forefront of change is crucial, as with every industry, accountancy is constantly evolving. For instance, with the introduction of ‘Making Tax Digital’, cloud-based accounting software such as ‘Xero’ is fast becoming an expectancy for the majority of clients, and it’s imperative that your accountant is completely up to speed to the latest software updates.

You will also need to ensure all financial responsibility between yourself and your current accountant has been discharged. For example ensure all of your bills are paid and neither party is waiting on an action or payment. Disputes over unpaid fees is the most common and significant threat to the smooth transfer of business.

Once you’ve made the decision to change, you need to think carefully about the most appropriate time for the handover between your previous and new accountant. Ideally this will take place when there is as little activity as possible happening. With this in mind, opting to change accountants at the end of your financial year would be inappropriate, as this is likely to be the busiest time for you.

What is the process of changing and switching accountant?

Choosing to switch to a different accountant is usually one of those unenviable tasks, which is why so many company leaders often choose to leave it for another year. However, it is not as difficult or disruptive as you might think, and the benefits can often outweigh the uncomfortable initial conversation you might have with your existing accountant. Professional accountants will also want a smooth transition and to respectively help you move, because they realise that you might want to refer them to someone else one day. Below are the very simple stages to follow.

Inform your current accountant

End things with your current accountant on good terms where possible. Let them know that you’re moving on, as this will make the whole process much smoother. You’ll need to grant them permission to speak to your new accountants in order to hand over any paperwork. Alternatively, your new accountants can help you draft a letter of notice to send on your behalf.

Professional clearance letter

Your new accountant will also need to write to your previous accountant. In this letter they will ask for professional clearance and request any relevant paperwork. They will also ask whether there is any reason they cannot take you on as a client – this is a formality and usually causes no problems. Your previous accountant may charge you a small fee for this service.

Assigning authority

Finally, you’ll need to assign authority to your new accountants for tax affairs. This means they can file returns on your behalf. HMRC will issue an authorisation code to confirm the authority of your new accountant and that they can deal with them directly on any taxation matters.

Summary

At Direct Peak we ensure the process of changing accountants is kept as simple as possible. Our aim throughout the process is to cause minimal disruption to your business.

As part of our onboarding you receive the following:

A clear proposal showing you exactly how much you will pay
A letter of engagement containing all of our policies, terms and conditions
An initial meeting with your main point of contact

To find out why company leaders are switching to Direct Peak, then please book in a quick Discovery Call with our team or chat to us online

    Karl Newman

    Author Karl Newman

    Hi! I'm Karl. I'm the founder of Direct Peak, a 100% Xero cloud accounting firm. I help business owners get complete financial clarity giving them decision making confidence.

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