In the world of business there appears to be snobbery when it comes to selecting a firm of accountants to assist with the company’s financial affairs or the director’s personal affairs. Many company directors seem to believe that ‘bigger is better’ and that a larger firm of accountants will be superior over smaller firms, however in reality this is not the case.
Small accountancy practices are often set up by fully qualified and experienced accountants who are bored of being an employee and want to go it alone and be their own boss. These small practices are unlikely to have many staff, if any at all therefore everything will be dealt with by the owner. From the simple and mundane tasks that are far below that of a qualified accountant, to the complex strategies and planning tasks all functions will be carried out by the owner. Therefore, the business owner can have the added comfort that everything will be scrutinised by someone who knows what they are doing.
In larger firms the leg work is carried out by unqualified lower grade employees that are just starting out in accountancy. Whilst the work performed by the junior members of staff will be reviewed by a manager, who may or not be qualified, there is still the possibility the junior member of staff will miss things that will not be picked up during the review process, which may be detrimental to the business. Everyone has to learn and it is only reasonable to expect that junior members of staff will miss things whilst they are becoming fully fledged accountants, and the fault lies with the managers, many whom have a large portfolio of clients and are so far stretched they can only give the accounts and working papers a cursory glance and not the full detailed review it needs.
So, the question you have to ask yourself is, do you want someone who is experienced, knowledgeable, and qualified to deal with your company’s or your personal financial affairs or are you happy to have an unqualified junior dealing with your affairs? It really is a no brainer.
When dealing with a small accountancy practice you will often find they are cheaper than larger firms. This is largely down to the fact that smaller accountancy practices do not have to cover the same level of overheads (in terms of employee costs, premises costs, utility costs etc) as larger firms. In addition, the partners of smaller accountancy firms are often satisfied with lower profit levels than partners of larger accountancy practices and are simply happy to get the work. Bearing this in mind, using a smaller accountancy firm to provide services is better value for money as you get highly skilled accountants for less money than using a larger accountancy firm, where you would pay higher prices for more junior accountants.
So, when looking for an accountant to deal with your personal affairs, or your company affairs never dismiss smaller accountancy firms without doing a bit of investigation first. Arrange a meeting with one of the partners to see what the firm has to offer and how they can help you and your business. Obtain a quote, just for comparison purposes in the first instance, and think about whether you could actually work with the partner of the small firm, after all you need a good business relationship with your accountant and you need to satisfy yourself that you can actually build and develop a professional relationship for many years to come.
Rather than looking at the size of the accountancy firm look at the qualifications. Fully qualified accountants are all regulated by their professional body regardless of the size of accountancy practice. Whether the accountancy practice has two partners or a hundred partners, one member of staff or five hundred, they all have to follow the same rules and procedures as determined by the professional body.