How to Assess & Hire an Accountant?
Published on November 6th, 2022
“When you think about accountants, who would want to be an accountant?" But what would we do without accountants? "Whether it's soldiers or garbage men or doctors, everyone has the thing that they love.” Fred Willard, an actor, writer, and comedian, said these words, and although it validates how they are undeniably required everywhere, this is just the tip of the iceberg. Read ahead and get a comprehensive understanding of why you should hire an accountant and, more importantly, a comprehensive guide to how you can do so.
What is an accountant?
An organization has business transactions happening on a regular basis, and these need to be recorded. Reports need to be made on company performance before they are sent to the management, and of course, financial statements need to be issued. This is where our hero (wearing a cape with math symbols) comes in handy: the accountant.
An accountant is a professional who carries out accounting tasks including financial statement analysis, audits, or account analysis. Accountants can establish their practices or work for an accounting firm or a big business with an internal accounting department. The CPA designation is regarded as the pinnacle of the accounting profession, which is why many accountants decide to pursue it.
What does an accountant do? Simply and sweetly placed, here is a general description of what an accountant does. Keeping aside all the specifics to get accustomed to when you hire an accountant
- Maintain accurate accounting and a transparent financial flow.
- Make sure tax rules are followed by filing tax returns.
- Develop financial stability and efficiency within a startup or small business.
- In a bigger organization, improve the financial procedures already in place.
The general list of an accountant's skills and qualities that sets them apart from the rest.
While hiring accountants, in case you feel lost, think of these four points and see if your line of thinking aligns with them:
- knowledge of how to read and evaluate financial information
- excellent organizational skills
- knowledge of tax planning.
- understanding of different accounting programs(like Xero, Sage QuickBooks, and so on)
- prior to employment in an accounting or at a firm that provides accounting services
Hiring an accountant? Which among the different types of accountants are you looking for?
As mentioned earlier, accountants are required almost everywhere and based on the field and aspects they focus on accountants are of different types:
- Certified public accountant (CPA)
- Management accountant
- Chartered accountant (CA)
- Government accountant
- Tax examiner
- Project accountant
- Financial adviser
- Investment accountant
- Forensic accountant
- Cost accountant
- Chartered Global Management Accountant (CGMA)
- Tax accountant
- Financial accountant
- Financial controller When hiring an accountant, you need to determine which accountant should be hired to suit the requirement of your company.
CPA: Hiring an accountant? A CPA to be specific? The most sought-after and useful credential for accountants is the CPA designation. An accountant gains more visibility from colleagues, clients, regulators, and business partners by becoming a Certified Public Accountant (CPA) as they have satisfied the minimal educational requirement, passed the demanding four-part exam, and committed to upholding a code of ethics. Their responsibilities include:
- Keep both digital and analog financial records organized.
- Evaluate each business transaction, then write thorough reports based on your findings.
- Research and preparation for income taxes should be coordinated with the staff.
- To ensure the correctness of financial records, expenses, and savings, conduct frequent audits.
- Place all federal, state, and local income tax records in order and file them.
- Participate in the budgeting process.
- Inform management of the company's financial situation on a regular basis and offer suggestions for ways to improve performance.
- Create and implement efficient accounting procedures.
- Make sure you keep abreast of industry and regulatory changes.
- Answer questions about accounting and taxes.
Management accountant: If you are hiring an accountant to take care of the financial and cost control reports' formats then a management accountant is what you should specifically look for. The most pertinent information from these reports is delivered to each level of management at the best possible time. Additionally, he or she instructs management leaders on how to use reports. As a result, he or she is sometimes referred to as the senior management's Chief Intelligence Officer.
- assembling and analyzing data to assess the effectiveness of financial processes
- examining significant financial facts and giving strategic planning advice to senior management.
- cost-effective financial policy and procedure development and implementation, as well as risk mitigation.
- creating financial reports and budgets, limiting spending, and predicting income.
- directing accounting processes and managing less experienced finance department employees.
- monitoring taxation and auditing procedures, as well as assessing compensation and benefit plans.
- ensuring that the practices and policies of financial management comply with legal requirements.
- maintaining financial records and safeguarding private and sensitive information.
- keeping abreast with legal requirements and management accounting best practices.
Chartered accountant (CA): The four fields of audit and assurance, financial accounting and reporting, management accounting and applied finance, and taxation are where CAs often concentrate their efforts. So, when hiring an accountant you know now when a C.A. can come to your rescue. Ther responsibilities include the following:
- oversee the accounting team's responsibilities.
- Set up accounting procedures and systems.
- Income statement reconciliation
- Publish financial reports each month.
- control the general register's master data.
- Examine and disburse payments made through internet banking.
- Make sure the state revenue service is followed.
- Continually offer assistance with reporting and accounting.
- oversee the entire financial procedure.
- Create a budget report for expenses.
Auditor: Auditors are financial experts who check the accuracy of accounting records and other financial papers. Their duties include:
- collaborating with businesses and governmental organizations to do research, find solutions, and create policies and practices that adhere to the law.
- analyzing, assessing, creating, and putting into practice innovative control systems that improve processes or make use of cutting-edge technology
- collecting, analyzing, and interpreting data to evaluate the performance of operations
- investigating anomalies, operational challenges, or other concerns.
- Comparing records, reports, receipts, or other papers to the assets and liabilities of the company.
- bringing the management team's attention to the company's strengths and shortcomings and offering guidance as they come up with solutions or remedies for these problems
- the creation of reports and the presentation of findings to management or other interested parties.
- keeping up with innovations, technology, and trends in the sector.
Government accountant: Government accountants are authorities on target agency policies and operational guidelines.
- They cultivate important connections, keep an eye on government spending, uphold fiscal accountability, and create long-lasting commercial alliances.
- They keep up with emerging technologies, legislative changes, and business trends and practices.
- Some government accountants plan and provide seminars, trade exhibits, and demonstrations that are supported by the government.
- Others do digital audits of enormous volumes of financial data or on-site inspections.
- The Generally Accepted Government Accounting Standards and accounting information management systems are required knowledge for government accountants (GAGAS).
- They must be knowledgeable about the structures, responsibilities, and financial policies of the government.
- They must be at ease asking probing inquiries, looking into delicate matters, and finding concealed accounting concerns. To comprehend and translate financial data into insightful reports, government accountants need to possess good analytical abilities.
- They must be at ease giving expert witness testimony in court proceedings involving investigations into white-collar crime and financial malfeasance.
Tax examiner Tax examiners typically work with the simplest tax returns, such as those submitted by small corporations and individual taxpayers who claim few deductions.
- To resolve any unresolved issues with taxpayers' returns, tax examiners may also get in touch with specific taxpayers.
- Making sure that tax credits and deductions claimed by taxpayers are legitimate takes up a significant portion of a tax examiner's duty.
- Tax examiners change the total amount owed if a taxpayer owes additional taxes by applying fines, interest, and penalties before informing the taxpayer of the full amount owed.
For certain company projects, project accountants provide financial support, direction, and supervision.
- At every stage of a project's lifespan, they are often involved in the financial aspects. They supervise any prerequisite pre-approvals or approvals.
- All invoices and purchase orders are examined, verified, and processed by them. Additionally, they make sure that all required tax documentation is finished and analyze and process cost and mileage reports as well as payments for suppliers and contractors.
- When necessary, they write expense reports with thorough supporting materials and put together final report summaries.
- A bachelor's degree in accounting, finance, or a similar discipline is often required of project accountants. They should be adept at using Excel and other office programs, as well as the main accounting software packages.
- Strong project management skills are required, as well as familiarity with accepted billing procedures.
A financial advisor's duties frequently extend beyond simply placing trades for their clients in the market.
- Interacting with customers to gather data on their costs, earnings, insurance coverage, financial goals, tax situation, risk tolerance, and other factors necessary to create a financial plan.
- Delivering financial advice and responding to client inquiries about financial goals and strategies.
- Providing clients with advice on solutions for insurance protection, investment planning, cash management, and other areas to help them achieve their goals
- Reviewing client accounts and plans on a frequent basis to determine whether situational problems, financial performance, or life or economic events call for changes in the client's plan.
- Developing solutions for achieving clients' financial goals by analyzing financial data that has been provided by clients.
- Creating or interpreting for customers investment performance reports, income estimates, and summaries of financial documents
- Keeping portfolios of clients current.
- Making frequent contact with clients to learn about any changes to their financial situation.
- Establishing and sustaining a clientele.
Investment accountant Investment accounting is a branch of accounting that focuses on managing and analyzing investment accounts.
- creating quarterly, yearly, and monthly reports.
- carrying out internal audits.
- watching over tax payments.
- creating the organization's budgets.
- tracking and reporting accounting irregularities.
- keeping abreast of financial policies, procedures, and rules.
- observing local, state, and federal tax laws.
Forensic accountant In forensic accounting, the finances of a person or company are examined using accounting, auditing, and investigation techniques. Forensic accountants are certified public accountants (CPAs) that search for evidence of crimes and frequently work for insurance firms, financial institutions, and law enforcement organizations.
- When called as expert witnesses in court, forensic accountants examine financial documents and accounts that could be used as evidence. They could assist with cases involving fraud and embezzlement and describe the characteristics of a financial crime in court.
- examining financial information from a business that may be participating in fraud
- gathering and examining proof of criminal activity
- analyzing and interpreting financial data
- interviewing employees to find out information and gather evidence
- constructing a criminal theory in light of the data.
- presenting the proper persons with the investigation's results
- recommending practical measures to handle and stop fraud events in the future.
- preparing records and evidence for presentation in court.
- Present members of the court with evidence of financial violations in a clear and professional manner.
- Providing a simple explanation of the research findings and revealing the investigation's methodologies and procedures
Cost accountant Depending on the firm, a cost accountant may have different specific responsibilities:
- preparing accounting reports for management submittal on a weekly and quarterly basis
- creating quarterly reports for senior management using a study of the inventory reserve
- recommending adjustments to processes and regulations to improve the organization's cash flow
- Reviewing labor, overhead, and depreciation rates while analyzing organizational data to suggest policy changes that could increase performance
- determining the average costs of goods and services and updating them in light of related costs
- maintaining and examining the balance sheets and general ledger
Chartered Global Management Accountant (CGMA)
Professionals with superior skill in finance, operations, strategy, and management are identified by the CGMA credential.
In order to retain the greatest level of relevance with employers and build the most in-demand competencies, it is supported by substantial global research.
Professionals with advanced skills in finance, operations, strategy, and management are identified by the Chartered Global Management Accountant certification. In order to retain the greatest level of relevance with employers and build the most in-demand competencies, it is supported by substantial global research.
- It was created in 2012 to honor a special group of management accountants who have attained the highest standard of quality and competence.
- It is a joint initiative of the American Institute of CPAs (AICPA) and the Chartered Institute of Management Accountants (CIMA).
- The greatest network of accounting and financial experts supports the CGMA credential.
- Holders of the CGMA credential are better equipped to analyze data, provide strategic advice, and advance corporate performance thanks to the Association of International Certified Professional Accountants, which represents AICPA & CIMA.
The duties of a tax accountant that distinguishes them from the remaining are as follows:
As a tax expert, you might often be responsible for and perform the following duties:
- the preparation of federal and state tax returns
- providing guidance on tax planning
- assisting clients to reduce their tax filing costs
- preparing annual tax-related strategies that clients can use all year round
- keeping customers from making unnecessary monetary commitments
- ensuring that clients fulfill their quarterly and yearly tax obligations
- advising clients on how tax laws and liabilities may affect them
- coordinating tax audits with the appropriate authorities
Financial accountant The list of duties that a financial accountant requires is as follows: creating quarterly, yearly, and monthly reports.
- carrying out internal audits.
- watching over tax payments.
- creating the organization's budgets.
- tracking and reporting accounting irregularities.
- keeping abreast of financial policies, procedures, and rules.
- observing local, state, and federal tax laws.
Financial Controller Senior managers that oversee a company's daily financial operations are known as financial controllers.
- putting together financial reports.
- examining financial information
- keeping an eye on internal controls.
- directing the creation of income statements.
- taking part in budgeting procedures.
- managing monetary exchanges.
- streamlining the procedures and tasks of accounting.
- making preparations for financial expansion.
- assessing and controlling risk.
- organizing auditing procedures.
Note: CPAs vs. Chartered Accountants (CAs)
The primary distinction between CAs and CPAs is that while CAs are utilized in many other nations, CPAs are only recognized in the United States. The acronym CPA can be used to refer to many accounting specialists across the globe. For instance, a CPA in Australia is a certified practicing accountant, whereas a CPA in Canada is a chartered professional accountant.
There is a reciprocity agreement between members of Chartered Professional Accountants Canada, Chartered Accountants Australia, and New Zealand, and Chartered Accountants Ireland and the United States. These CA experts can practice as CPAs in the US if they pass a test to transfer their credentials.
"Hiring the wrong people is the fastest way to undermine a sustainable business." – Kevin J. Donaldson
The 11 qualities of a good accountant.
Knowing the qualities of a good accountant is step one. Understanding these qualities is the key to amping up your hiring game. There are some key skills required for all accountancy professions, even if the skills and attributes will vary slightly depending on the level you're hiring for and the type of accountant. While curating or creating the accounting test for the job interviews of the star accountant you wish to choose for your company, a good grasp of these qualities will improve your decision-making substantially. The following are the essential competencies and characteristics of an accountant, along with hiring criteria to consider:
Qualities of an accountant 1: Verifying the necessary credentials. Yes, we are in a world where skills are more important than suave and certifications. However, the safest route when it comes to starting off the selection process is to check these credentials and certifications. The AAT certification is considered the bare minimum for an accountant, however, candidates for chartered accountant positions must also possess ACCA, ACA, or CIMA credentials.
Qualities of an accountant 2: Formidable in mathematics “Mathematics is the language in which God has written the universe.”- said Galileo Galilei. Although, there’s no need to enter the god-realm of mathematics and crack the code to extremely difficult puzzles, a strong understanding of mathematics and its quick application is a bare basic in the world of accounting.
Qualities of an accountant 3:Data evaluation Since accountants deal with numbers on a daily basis, you must hire someone with great data analysis abilities. They must have the analytical skills to recognize trends and problems in data in order to help your organization.
Qualities of an accountant 4: Computer proficiency Although this is another bare basic in the tech-driven world, there are many old-schoolers really good at math, but not quite adept with tech. The accountant you hire must be adept at using the computer at least to a basic level. There is always the option of training them if they are at a junior level, but starting all the way from scratch could be a pointless waste of time and resources.
**Qualities of an accountant 5: Knowledge of the latest software and tools for accounting. ** This quality is more of an add-on to the previous point, but depending on the seniority of the designation, having a grasp of the everyday accounting tools will be a great asset to your company. Many accountants have their own favorite programs that they regularly utilize. If your business utilizes a separate program, this could be a concern because transferring data takes time and can go wrong. Find an accountant who either already uses the software or is open to learning it. Utilizing collaborative, cloud-based software with encryption built in is an excellent way to avoid worrying about the security concerns of data exchange.
Qualities of an accountant 6: Excellent interpersonal and communication skills There is a common stereotype associated with math whizzes that they lack good interpersonal and communication skills, however, this is merely a generalization and is far from the truth. There is no need for a breathtaking orator who can catch the wonder of their employees, however, if the candidate has the basic interpersonal and communication skills, it can take them a long way, especially if they are climbing into more senior positions. The other reason why accountants must be excellent communicators is that, at the end of the day, they deal with both numbers and clients. So, It's crucial to prioritize soft skills when employing accountants in addition to their technical and analytical abilities. An easy way to analyze this skill in the interview is by looking for applicants who can strike up a rapport quickly and have a history of forging close bonds.
Qualities of an accountant 7: Meticulousness with the details This is another one of those must-have personal qualities that come as a package with their above-average mathematical capabilities. Candidates must pay close attention to even the tiniest details to ensure accuracy and few mistakes because even the smallest error in figures might distort data. You should seek applicants who are extremely analytical and take accurate information seriously.
Qualities of an accountant 8: Superior time management abilities Accountants frequently have several projects to manage at once, and they must manage the numbers, financial information, and documentation to meet frequently strict deadlines.
It's crucial to look for applicants with strong time management and project management skills, as well as the ability to prioritize assignments.
Qualities of an accountant 9: Able to think creatively and come up with original concepts While creativity may not be a trait you immediately identify with accountants, they frequently need to think creatively to solve particular client problems. Look for applicants who are willing to present a novel, innovative solutions and who aren't scared to explore novel approaches.
Qualities of an accountant 10: Ability to work with a diverse workforce It's crucial to keep in mind that when employing an accountant, inclusion, and diversity in the workplace should be taken into account. Both your business and your employees will profit greatly from having a diverse staff. An accountant should also be understanding of these benefits and be adaptive to the diverse environment,
Qualities of an accountant 11: Industry knowledge You need to choose the best accountant for your industry based on your business. Accountants frequently focus on specific industries; however, just because they perform well in one field does not mean they will succeed in another. Therefore, if you're employing an accountant, search for someone who works in the same field as your company.
A coin cannot exist without two sides. Just as understanding the good qualities of an accountant is important, even understanding the bad signs of an accountant is equally important as well.
Warning signs of a bad accountant They lack discretion. It won't take them long to disclose your experience if they are eager to sell out their current clients to show off their experience. They frequently miss deadlines, are out-of-date, neglect to engage in ongoing professional development, and commit careless errors. They recommend dishonest methods to obtain a loan, avoid paying taxes, or con investors.
One of the best examples of a bad accountant is Bernie Madoff. A prosperous American businessman who had all the qualities of a good accountant, but he operated a Ponzi scheme that defrauded investors. The US had never experienced financial fraud on this scale. The scheme defrauded more than 37,000 investors of billions of dollars by paying existing investors with new investors' funds rather than the company's profit. Madoff was apprehended as a result on December 11, 2008. He was put behind bars along with his accountants.
How to hire an accountant?
With a shopping list-like set of different accountants, the next question is which type of accountant should I hire? You might wish to work with an accountant, a certified public accountant (CPA), or an accounting firm when it comes time to create your financial statements. An accountant can assist you in organizing your financial data whether you need to generate financial statements or pay taxes for your small business, family, or just yourself. Additionally, most accountants keep up with the most recent changes in tax legislation and procedures. They can assist you in locating every tax deduction for which you may qualify, maximizing your tax deductions, and minimizing your tax liability. If you have read the article till this point you would be aware of the different types of accountants and what they do, and also a general set of qualities all accountants should possess.
How to Choose an Accountant that Suits Your Needs
Decide if you require a CPA or an accountant. Depending on their skill level, accounting professionals can execute a variety of duties and accomplish slightly different work each day.
Making journal entries and posting accounts payable, receivables, and payroll taxes are just a few of the numerous bookkeeping chores that fall within the purview of an accountant. The majority of a company, firm, or corporation's daily financial tasks are handled by accountants.
A CPA's duties include consulting with clients, choosing the best reporting strategy, and auditing financial records. They are qualified to carry out a few more duties than accountants, chief among which is the capacity to represent clients in IRS audits. In addition, a lot of CPAs own their businesses.
Seek recommendations from friends or coworkers. Finding local possibilities and starting your search for an accountant can be made much easier with this method. Ask other business owners in your sector for recommendations of accountants who specialize in your industry if you need one for your small business.
Consult national and state organizations. For help selecting a CPA firm or an accountant in the United States, get in touch with your state's CPA society. Additionally, you can check references for an accountant with the National Association of State Boards of Accountancy. Professional boards similar to these exist in many other nations.
Use social media responsibly. Even if social media platforms are not the most trustworthy places to go, it won't harm to investigate a potential accountant's background there.
Discover the ideal fit. This is a business partnership that seriously affects your financial stability. It is crucial to choose an accountant you respect, who is attentive to your demands, and who is knowledgeable.
How well do they communicate? Can you get in touch with them when you need to? Do you feel at ease disclosing to them the specifics of your financial situation? The ability to translate esoteric and complex jargon into information that you can understand is the mark of a good professional. Obviously, you want an accountant who is knowledgeable in their field. Seek out a partner with whom you can have a lasting connection.
Discover more about the local accounting firms. Visit the websites of the accountants you have been referred to in order to discover more about them. Based on the accountant's or firm's area of expertise, take into account your business's needs. You might want to pick an accountant who has the experience, specializes in small business concerns, and works with other businesses in your sector. A competitive advantage for an accountant is industry experience. To provide their finest services, an accountant should be able to communicate with you about the demands of your company.
Determine the firm's size. Would working with a larger firm be preferable to working with an accountant who has their own small firm? Larger businesses may be able to handle and provide a wider range of services than smaller businesses. If you require assistance with highly specialized work, you should find out if the company or person is qualified and licensed to complete it.You should look into and speak with the larger organization and the team that they are working on as larger corporations or individuals with more complicated financial problems may require more than one accountant to handle their financials. Retain in mind that many solo practitioners operate from home; it's pretty typical for them to communicate remotely or even keep their books at their home office. This is especially true for minor needs. Additionally, they can request to meet you somewhere neutral, like a coffee shop. Don't let this worry you.
Verify the credentials of any prospective accountant. After then, it doesn't really matter where the work is done. The absence of an office or suite may actually result in fewer overhead expenses and fees.
Ask about the fees for an accountant. Finding an accountant within your price range is crucial, but if your financial situation becomes more complex or demands more attention, you might need to change your budget.If you hire an accounting business, the cost of the services will vary based on the size of the company, the level of experience of the accountant, and the location of the firm. You can first delegate the preparation and write-up of your tax return to a junior account. In this scenario, after the junior accountant prepares the tax returns, a CPA may evaluate them. Typically, the consulting job will be handled by the business partners. The rate an expert costs per hour will increase with the level of responsibility.
Speak with various accountants. You may now start contacting people to set up interviews based on your research and any references you may have gotten. To make sure you're hiring the greatest accountant for you, you should go around and interview a few different firms and accountants. Before your interviews, get ready. You should have a clear understanding of your needs, your budget, and the services you require from an accountant.
Ask for the necessary details. References, a list of the services, actual invoice examples, and the fee plan are a few examples of what might be provided. If you are engaging an accountant for continuous consultation rather than tax season, for instance, your pricing structure and the services you need would be considerably different. Investigate these references further and confirm them with the state CPA registries and boards. Ask the accountant about their schooling, the businesses they've worked with in the past, and their certifications. It is vital to inquire about the person's ability to practice in your state because certifications differ from state to state. Also, inquire about the turnaround times. Be specific if your company needs information on the timeline, as many accounting companies prefer to over-promise on this.
Pose thoughtful queries. Ask questions during your interview with prospective accountants that will help you learn more about them as people, the company they work for, and what to anticipate. Find out the duration of the person's or company's existence. How big is the business? How long have they worked for the company or on their own? How quickly do you typically respond when you need financial statements for the year ended or tax returns prepared? Which clientele do they have in addition to these? How many of its clients does the IRS annually audit?
Analyze the value you receive for the cost. Despite appearing expensive, accounting services may soon pay for themselves through tax deductions and savings. Ask for quotations from accounting firms or individuals when conducting interviews, and utilize these numbers to help you decide who to hire. Consider hiring an accountant as a financial investment in your personal or corporate finances. The opportunity cost of engaging an accountant should be considered. Instead of spending hours creating your financial statements, what else could you be doing? Although they frequently charge more than a junior accountant, more seasoned professionals can work more quickly and efficiently.
Employ the accountant or accounting business that best suits your needs and financial constraints. You are prepared to choose an accountant to hire once you have done your homework and spoken with a number of them. Set up your initial meeting with your newly hired accountant so they can start evaluating your tax and financial needs. Get your new accountant to write you an engagement letter outlining the costs, timeline, obligations, and other expectations. Asking for one is a smart idea if one isn't given. Start gathering your financial records and data to share with your new accountant.
Conclusion: That’s a lot of information to take in especially if you are just about to start your hiring process. Your efforts to learn about hiring accountants are commendable, however, if you are just starting, it's best you take some expert guidance. Get on a call with our experts here at HireQuotient, we’ll help you set up a basic process to get you started with your accountant hiring process. To get a glimpse of our testing modules, feel free to check out our
Accounting Manager Test
Accounting Assistant Test
It's not always easy to differentiate and define everything in black and white, however, there is a way to tilt the odds in your favor by putting a foolproof evaluation system in place. What you need is a skill assessment platform like HireQuotient that tests the skills of all your candidates and presents you with the top performers who have all the skills that you require for the designation of your choosing. Get in touch with our experts right away.
Thomas M. A.
A literature-lover by design and qualification, Thomas loves exploring different aspects of software and writing about the same.
Never Miss The Updates
We cover all recruitment, talent analytics, L&D, DEI, pre-employment, candidate screening, and hiring tools. Join our force & subscribe now!
Stay On Top Of Everything In HR