Cutting Costs? Don't Be Too Hasty Where Your Accountant is Concerned!

In times of economic difficulty, many business owners look for ways to cut costs. Saving money is one thing, but all too often the action taken to save that money can have the completely opposite effect and prove a drastically false economy.

Amongst the most popular courses of action small business owners seem to be taking in order to cope with the effects of the economic downturn is either switching to a cheaper accountant or taking on the task of preparing their own books and figures. However, both these decisions will in the majority of cases only save money in the short term and could have far reaching consequences that end up costing the business dearly in terms of time as well as money.

If you are happy with your accountant and they have been consistently saving you money and providing a good service, but you feel they are simply charging you too much and you have been offered a better deal elsewhere, then you should stand back and ask yourself a few questions before making the move. And these should not be the only questions you ask; you should also have a set for your potential new accountant because there are several things you must get clear before you start working with them.

Firstly you need to make sure that you will receive the same level of service from the cheaper accountant. The old adage, 'you get what you pay for' is never truer when it comes to professional services. Will they return your calls promptly? Will they deal with your work with the efficiency you are used to?

Secondly, you need to check their experience and reputation. How long have they been qualified? How long has their practice been trading? Can they provide you with testimonials from satisfied clients?

Thirdly, think about the level of expertise of the firm's staff. Generally a practice that charges less will pay their staff less; this often indicates that the staff are under or even unqualified, poorly trained, lacking in experience and possibly unsupported by their employer. This of course will not make for a pleasant experience with your new accountancy firm.

Lastly, check for hidden costs. You may have been quoted a figure to prepare accounts and deal with a tax or VAT return, and you may think that is all you will have to pay. But beware, because some firms will charge you every time you telephone them, and some will even make charges for writing to you! Make sure your quote covers everything.

In times of economic crisis it is easy to get carried away with cost cutting exercises, focusing on the savings you think you will make by switching to cheaper alternatives or by doing things yourself. However, it is wise to take some time to seriously consider the consequences of your money saving initiatives, because they could well end up costing you far more than they would have done if you had left them alone!

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