What makes a good accountant for a start-up?
What makes a good accountant for a start-up? A lot of them seem to be very focused on the corporate end of town.
This is a question I often get asked, usually framed during initial client meetings when clients are going through a filtering or interviewing process of their key advisors (usually accountants and lawyers).
Let’s move away from the vague term ‘good’, and let’s talk about effective, efficient and ethical.
Firstly, your ideal advisor needs to be an effective advisor. This usually means that they already operate in the start-up/technology/particular industry space, know the laws, consequences, pitfalls and issues.
They will navigate you and your business through the myriad of issues a start-up will need to deal with including: tax structuring, grants and tax (R&D) concessions, capital raising and potentially international considerations.
They will have a well-developed network of contacts across a number of government agencies as well as strong commercial relationships with specialists i.e. IP/trademark and commercial lawyers and angels/VCs/incubators.
Just as importantly, effectiveness also extends to the art of communication. If an advisor cannot articulate the message in an easily understandable and digestible way, they either don’t understand the issues themselves or they are not the advisor for you.
Either way – it won’t work. The right advisor will also need to be an effective and patient educator.
One simple test is what I call the annoyance test – ask a whole bunch of questions and if there is the slightest bit of irritation or annoyance from the advisor – leave.
Secondly, the ideal start-up accountant needs to be efficient. Efficiency normally follows effectiveness, as most clients, and particularly start-ups, do not want to pay for an advisor’s training.
In other words, if the advisor has had a breadth of experience dealing with key industry issues, chances are that your needs will be handled confidently and efficiently.
So efficiency can be measured in terms of the time it takes an advisor to complete the advice/work, the amount of money it will end up costing you and critically – responsiveness.
Topping the client list of complaints about advisors is lack of responsiveness. If it takes weeks for your urgent start-up question or issue to be answered by an accountant, it is likely that by the time it is answered you would have forgotten the question. Check the pulse and energy levels of your advisors to make sure that your advisor is committed to be with you through the start-up journey.
Last and by no means least, the advisor must be ethical. An accountant and a practice that operates under a Chartered Accountants (CA) or Certified Practising Accountants (CPA) banner means more than just a logo and signage. It means that the advisor must abide by strict ethical guidelines and principles. This extends to a number of areas including professional conduct, quality control mechanisms and confidentiality.
To a professional advisor these are not just terms, but a value system by which the practice and their networks and contacts live by.
The benefits to a start up are obvious and numerous. Put simply, working closely with ethical people means transparency (workflow, billing and advice) and the formation of the key ingredient in any professional relationship – trust.
I’ll leave you with these final thoughts – ask plenty of questions, check the advisor’s profile (LinkedIn, Facebook, website) and make sure that they understand and share the entrepreneurial spirit. Good luck!