Accountants have been all over the popular media over the last few weeks what with Jimmy Carr and headlines, like Rihanna sues former accountancy firm for 'defrauding her out of millions of dollars by charging jacked up fees'
. Now I don’t claim to know anything about the music industry, or that particular case but I do know that in the UK we have some pretty strict rules and regulations for Chartered Accountants which means the kind of negligence and ‘jacked up fees’ claimed in this case shouldn’t happen.
It did set me thinking however. Whilst most people that go to an accountant aren’t 16 year old potential pop superstars (that’s how old she was allegedly when she first sought accountancy advice); they may not have much idea what to expect or what to look for in an accountant.
So, for what it’s worth Rihanna here’s what you should have been looking for when selecting an accountant:
Suitable qualifications: anyone can set themselves up in their back bedroom and call themselves an accountant. You should look for a firm belonging to a recognised body like the Institute of Chartered Accountants of England and Wales (IACEW) and ideally you will want a Chartered Accountant, or at the very least someone who can demonstrate they have relevant qualifications.
Sound advice in a language you can understand: on things like - how to structure your business affairs tax efficiently, what financial records you need to keep, which financial reports to use to run and manage your business as well as the more strategic tax and retirement planning advice you’ll need in times of growth.
Experience in your sector: check they’ve worked with businesses similar to your own and that they understand what it is you do, what your goals are and that they can support you to achieve them.
Clear explanation of fees: you don’t want any nasty surprises. Your accountant should advise you how much they charge for the work that they do, before they do it.
Relevant expertise: in the case of someone like Rihanna I’m guessing she would have needed some complex tax planning advice as well as guidance on structuring her personal and business finances, so it’s likely she will have needed professional Financial Planning Advice as well as accountancy advice. Don’t assume your accountant can supply this. Whilst I’m dual qualified as a Chartered Accountant and Chartered Financial Planner there aren’t many that are.
I don’t suppose many small firms have quite the same requirements as an international pop star, but the advice is still valid. Above all don’t assume an accountant will do a good job for you, do check them out.
Chartered Accountant and Chartered Financial Planner