When and how to change accountants: A guide for small to medium businesses
Is your accounting relationship still serving the business you are today rather than the one you used to be? As your business grows and evolves, so too should your accountant. What may have worked perfectly when you had just a handful of clients and straightforward needs may not adequately support your current ambitions.
In this blog, we’ll guide you through recognising the signs that your accountant might not be keeping pace with your growth and, importantly, how to proceed if you decide it’s time for a change.
Why remain with the same accountant?
Continuity can have real benefits. Your existing accountant understands your history and industry and has built trust over time. Many business owners stick with their accountant out of loyalty or comfort. However, it’s essential to remember that allegiance shouldn’t come at the expense of your business’s performance, efficiency, or future potential. If your relationship with your accountant has shifted from a genuine partnership to mere complacency, the hidden costs can add up quickly.
Recognising the red flags
Here are some common warning signs that indicate your accounting relationship may be holding your business back:
Reactive rather than proactive approach: If your accountant only contacts you at year-end or during tax season and doesn’t offer guidance on planning, strategy, and growth, you could be missing valuable insights.
Poor communication or slow response times: Does receiving a reply take days or even weeks? Are you left struggling to understand your numbers, forecasts, or tax position? Timely and transparent communication is key.
Lack of industry knowledge or growth mindset: As your business has grown in complexity or scale, ask yourself if your accounting partner is still suited to meet these needs. If you repeatedly explain your business model, it’s a sign that they may not be the right fit.
Outdated systems and manual processes: If your accountant still relies on paper, spreadsheets, or manual data entry while your competitors are leveraging cloud accounting, real-time dashboards, and automated workflows, your business may be at a disadvantage.
Feeling neglected: If you sense you’re just seen as ‘another client’ rather than a valued partner, this relationship may no longer serve you well.
Missed opportunities or unclear financial metrics: If you’re not regularly reviewing crucial business metrics, feel in the dark about your margin, cash flow, growth potential, or lack robust forecasting, your accountant should be helping you navigate these areas, not just filing your returns.
Recognising these issues isn’t about placing blame but about being honest about where you and your business stand today and where you aspire to go.
Timing your change
Deciding to change accountants can feel overwhelming, but delaying the decision might cost you more missed opportunities or inefficiencies than you realise. Here’s how to approach the timing:
Choose a quiet moment: Look for a time when you’re not facing urgent deadlines. A less busy time gives you the space to ensure a smooth transition.
Consider upcoming plans: If you anticipate significant changes such as expansion, acquisition, or exit planning, switching sooner allows you to establish a new relationship beforehand.
Be prepared: Gather all your current books, contracts, software credentials, and data. A new accountant will need to review this to get started effectively.
Set clear goals: Decide what you expect from your new accountant over the next 12 to 24 months. Whether seeking more advisory support, digital transformation, or improved cash-flow modelling, be transparent about your needs from day one.
What to look for in your next accounting partner
When selecting your next accountant, especially for a small- to medium-sized business with ambitions, keep the following in mind:
Strategic mindset: You want an accountant who acts as a partner in your business rather than just a compliance function.
Tech-enabled services: Look for firms that offer cloud accounting, digital records, real-time dashboards, and collaborative tools.
Sector experience: An accountant familiar with your industry can provide clearer insights and help you avoid surprises.
Proactive communication: Regular check-ins, transparent reporting, and timely responses are essential.
Scalable services: As your business grows, you’ll likely require forecasting, advisory, or acquisition support. Choose an accountant ready to grow with you.
Local presence and trust: A local team familiar with the regional business landscape can add significant value.
Ensuring a smooth transition
Once you’ve chosen your new accountant, here’s how to make the onboarding process seamless:
Planning meeting: Define the scope of work, services, responsibilities, timelines, and expectations.
Data handover: Transfer historical records, software access, bank feeds, bookkeeping records, and contracts.
Clean-up phase (if required): Address any backlog, reconcile records, and agree on a chart of accounts with your new firm.
Set a reporting schedule: Determine how often you’ll receive management accounts, dashboards, forecasts, and when to hold advisory meetings.
By keeping these points in mind, you can ensure that your accounting relationship aligns with your current business needs and future aspirations. Remember, your accountant is not merely a service provider; they should be a strategic partner in your journey towards success.
Recognising when it’s time to change accountants is crucial to ensuring that your business can thrive in a competitive landscape, and it is much easier than you think.
Looking to change? Look no further!