How to Choose the Right CPA

How to Choose the Right CPA

In this video, Mel shares a few suggestions and questions to ask when hiring a Certified Public Accountant. Learning a bit more about a CPA will help to choose one that has the knowledge and experience that fit your needs.

Today, I'd like to talk to you about an important subject that sometimes gets overlooked—how to choose the right CPA. Often, we ask a friend, family member or colleague for a name, or we talk to our attorney or our financial adviser about what to do when you get to that initial meeting with the CPA. What questions should you ask them and what are some things you should look for. These are all important notes that need to be addressed, so I'm going to give you a few things to think about.

  1. When you're in that first meeting with a prospective CPA, ask if they have ever started a business or have they always worked for another firm. There's really no right or wrong answer necessarily, but if you're a business owner, you often do things that go outside of those lines of tax code, debits and credits and more into the operational aspects of a business. You want someone on your team who's “been there and done that,” and can give you practical advice on how to navigate those choppy waters.

  2. I would ask that CPA what their billing structure is. How do they charge you for their services? Do they charge by the hour? Do they charge based on the project? Do they charge you based on a flat fee? Every one of these has a different ramification and can have a very different outcome, so it's important to understand that upfront and have a clear scope of work. For instance, CPAs that charge hourly sometimes can create unnecessary pressure on the relationship by looking at the client as simply a commodity. How many hours can I charge this person? Or if it's not the right number, they might focus their time on someone else. You have to be mindful of that. In a flat fee arrangement, you have to make sure that the fee is reasonable enough for both sides. You don't want a CPA who feels that they're not charging enough and therefore doesn't put in the proper energy. You also don't want to be paying way more than what you're getting. All important things to discuss.

  3. With the pending legislation that's out there right now, we know that things are going to be different next year and for many years to come, so I would challenge you to do this now instead of looking for that CPA in November or December—or even worse—January or February after the year is over. I would consider looking for them as soon as possible so they can track with you throughout the year and have the time to benchmark while being right there with you to let you know where you stand as the year goes by. That way when you get to the end of the year, there are no surprises. I like to say I want the tax filings to be a formality. We're already going to know what they look like with no surprises because we've been tracking everything throughout the year and having regular conversations.

These are just a few important things to consider when choosing a CPA and I would suggest that you ask these questions of not just a CPA, but any adviser that you sit down with. If you have any questions, comments, or ideas for future podcasts, please let us know. We really would like your feedback.