12 Signs Your Business Needs a Better Accountant

Your accountant should do more than file your accounts and tax returns once a year.

Depending on the service you have agreed, a good accountant should help you understand your numbers, prepare for tax liabilities, improve cash flow and make better business decisions.

Many business owners only realise they need more support after receiving an unexpected tax bill, struggling to get an answer or discovering that their financial records are months out of date.

Here are 12 signs it may be time to review your current accountant.

The short answer

Your accountant may no longer be meeting your needs if:

• You only hear from them at year-end.
• Your figures are never explained.
• Questions feel unwelcome.
• Tax bills are always a surprise.
• You receive no proactive advice.
• Your bookkeeping is behind.
• They do not understand your business.
• You receive no management information.
• You are always chasing replies.
• Their systems feel outdated.
• They only discuss tax.
• You lack confidence in your finances.

Not every delayed reply or unexpected tax payment means you should immediately change accountant. However, repeated problems may indicate that your business has outgrown the service it currently receives.

1. You only hear from them at year-end

Annual accounts are important, but they mainly explain what has already happened.

By the time the figures are prepared, it may be too late to:

• Change director remuneration.
• Plan pension contributions.
• Review capital expenditure.
• Address cash-flow pressure.
• Correct recurring bookkeeping issues.
• Use year-end tax-planning opportunities.

A growing business may benefit from quarterly meetings, tax estimates or monthly management information rather than one annual conversation.

Regular accountancy and management accounting support can give business owners more useful information throughout the year rather than only after the financial year has ended.

2. They never explain your numbers

Receiving a completed set of accounts is not enough if you do not understand what the figures mean.

Your accountant should be able to explain:

• How much profit was made.
• Why profit changed.
• What tax is expected.
• What the company owes.
• What customers owe the company.
• Whether cash flow is improving.
• Whether the Director’s Loan Account is overdrawn.

The explanation should be clear and practical.

You should leave the discussion understanding the current position and any actions that need to be taken.

3. Every question feels like an inconvenience

Business owners regularly need advice about employees, expenses, VAT, dividends, vehicles, investment and cash flow.

Some questions require research and cannot be answered immediately. However, you should not feel uncomfortable asking for help.

Warning signs include:

• Calls repeatedly ignored.
• Emails left unanswered.
• Questions dismissed.
• Advice arriving too late.
• No indication of response times.
• Unexpected charges for routine queries.

Your service agreement should explain what advice is included, what costs extra and who your main contact is.

The level of support required will vary from one business to another, so the important point is understanding what has actually been agreed.

4. Tax bills repeatedly come as a surprise

Tax payments are not always predictable to the exact pound, particularly where profits change during the year.

However, Corporation Tax, VAT, PAYE and Self Assessment liabilities should not normally be complete surprises when accurate information is available.

Regular tax estimates allow you to:

• Understand likely liabilities.
• Set money aside.
• Plan payments.
• Avoid spending money reserved for HMRC.
• Identify planning opportunities earlier.

Repeated surprises may indicate outdated bookkeeping, poor communication or a lack of tax forecasting.

5. They never suggest ways to improve

A proactive accountant should look beyond filing deadlines.

Depending on your circumstances, they may raise issues involving:

• Cash flow.
• Profit margins.
• Pricing.
• Business structure.
• VAT registration.
• Director remuneration.
• Pension planning.
• Capital investment.
• Financial risks.

Proactive advice does not mean promoting aggressive tax schemes.

It means identifying relevant issues before they become urgent.

For example, your accountant might warn you that turnover is approaching the VAT threshold or that an overdrawn Director’s Loan Account is creating a tax risk.

6. Your bookkeeping is always behind

Decisions based on old information are often unreliable.

When bookkeeping is months out of date, you may not know:

• Your current profit.
• Which customers owe money.
• What suppliers must be paid.
• How much VAT is due.
• Whether spending is increasing.
• How much cash is genuinely available.

Delayed records also make missing receipts, duplicate payments and coding errors harder to resolve.

Regular bookkeeping gives business owners and accountants more reliable information throughout the year.

7. They do not understand your business

Useful advice requires an understanding of how the business operates.

Your accountant should know:

• How you generate revenue.
• Your main costs.
• Your payment terms.
• Your seasonal patterns.
• Your industry risks.
• Your growth plans.
• Your personal objectives.

Advice for a construction company may differ significantly from advice for a retailer, landlord or professional consultancy.

If you repeatedly need to explain the same business model, your accountant may not have developed enough knowledge of your company.

A strong accountant-client relationship should develop over time as your adviser gains a better understanding of how the business operates and what you are trying to achieve.

8. You never receive management accounts

Annual accounts explain the past.

Management accounts help you manage the present and plan for the future.

Regular management accounts may include:

• Profit and loss reports.
• Balance sheets.
• Cash-flow forecasts.
• Budget comparisons.
• Aged debtors.
• Aged creditors.
• Gross-profit analysis.
• Key performance indicators.

Not every small business needs an extensive monthly pack.

However, growing companies often benefit from regular information that shows whether performance is improving and whether planned decisions are affordable.

This can be particularly useful when considering recruitment, investment, borrowing or expansion.

9. You are always chasing replies

Slow communication can delay important decisions about:

• Recruitment.
• Contracts.
• Equipment purchases.
• Dividend payments.
• VAT registration.
• Finance applications.
• Tax deadlines.

Complex questions may need additional time, but your accountant should acknowledge the query, explain what information is required and provide a reasonable response date.

Repeatedly unanswered emails, missed deadlines and conflicting answers may indicate that the current service is not adequately resourced.

10. The technology feels outdated

Technology does not replace accounting knowledge, but appropriate systems can make financial management faster and more accurate.

Modern processes may include:

• Cloud accounting.
• Bank feeds.
• Digital receipt capture.
• Automated invoice matching.
• Secure document sharing.
• Real-time reporting.
• Payroll integration.

Warning signs include repeated manual data entry, insecure document sharing and reports being produced too late to be useful.

Merranti’s accounting software service helps businesses choose and implement systems suited to their actual requirements.

The right software should make your accounting information easier to use, not simply introduce more technology for the sake of it.

11. They only talk about tax

Reducing tax is important, but the lowest immediate tax bill is not always the best commercial outcome.

A business may also need advice on:

• Cash-flow planning.
• Pricing.
• Profit margins.
• Forecasting.
• Recruitment.
• Funding.
• Growth.
• Investment.
• Risk management.

For example, buying equipment may reduce taxable profit but create cash-flow pressure.

Paying a large dividend may be tax-efficient but leave the company without enough working capital.

A commercially focused accountant should consider the wider effect of each decision.

Tax should form part of the business decision rather than being considered in isolation.

12. You do not feel confident

The clearest warning sign may be that you do not trust or understand your financial position.

You may feel unsure about:

• What tax you owe.
• Whether the business is profitable.
• Whether deadlines are being met.
• Whether the records are accurate.
• Whether the company can afford new commitments.
• Whether important issues are being missed.

Some uncertainty is unavoidable, but your accountant should help reduce it through accurate information, clear explanations and timely warnings.

You should have a reasonable understanding of where the business stands financially and what significant commitments are coming next.

Before changing accountants

Review your current engagement letter before making a decision.

A basic annual accounts package may not include:

• Monthly bookkeeping.
• Management accounts.
• Regular meetings.
• Cash-flow forecasting.
• Detailed tax planning.
• Unlimited advice.

Ask whether the business has outgrown its existing package and whether the service can be upgraded.

You should also consider whether you:

• Supplied information on time.
• Responded to requests.
• Raised concerns directly.
• Clearly explained the support you wanted.

Sometimes the relationship can be improved without changing firms.

This is an important distinction.

A service may be poor because the accountant is not delivering what was agreed, but equally the business may simply need a more comprehensive level of support than it originally purchased.

Is changing accountants difficult?

Changing accountant is usually straightforward and can normally take place at any point during the year.

A typical transfer involves:

1. Choosing the new accountant.
2. Agreeing services and fees.
3. Signing an engagement letter.
4. Completing identity checks.
5. Authorising contact with the previous accountant.
6. Completing professional enquiry.
7. Transferring relevant records.
8. Updating HMRC authorisations.
9. Moving software access.
10. Confirming outstanding deadlines.

The incoming accountant will normally contact the outgoing accountant with your permission.

This process is commonly called professional clearance, although the more accurate term is professional enquiry.

The outgoing accountant may provide items such as:

• Previous accounts.
• Tax returns.
• Tax computations.
• Trial balances.
• Payroll information.
• VAT records.
• Fixed-asset schedules.
• Relevant HMRC correspondence.

Your original business records should generally remain available to you, although the accountant’s own internal working papers may belong to the firm.

What should you check before moving?

Changing accountants should solve a problem rather than simply move it somewhere else.

Before making the switch, identify what you want to be different.

For example:

• More regular communication.
• Better tax forecasting.
• Monthly bookkeeping.
• Management accounts.
• Faster replies.
• More commercial advice.
• Better accounting software.
• Clearer fees.
• A dedicated contact.
• More proactive planning.

This makes it easier to compare firms based on the service you actually need rather than simply choosing the lowest quote.

Questions to ask a new accountant

Before appointing someone new, ask:

• Who will be my main contact?
• What is included in the fee?
• What work costs extra?
• How quickly do you respond?
• How often will we speak?
• Do you provide tax estimates?
• Can you prepare management accounts?
• Do you understand my industry?
• Which software do you support?
• How will the handover be managed?

The answers should reflect the level of service your business actually needs.

It is also worth asking what happens as your business grows.

The accounting support suitable for a small start-up may not be enough once the company has employees, VAT obligations, multiple locations, significant borrowing or more complex management-reporting requirements.

Frequently Asked Questions

How often should I speak to my accountant?

A simple business may only need an annual review.

A growing or cash-sensitive business may benefit from monthly or quarterly meetings.

The right frequency depends on the complexity of the business and the level of support agreed.

Can I change accountants during the year?

Yes. You do not usually need to wait until your financial year or tax year ends.

However, it is sensible to make sure upcoming filing and tax deadlines are clearly allocated during the handover.

Will I lose my records?

Your underlying business records should remain available.

However, some internal working papers may belong to the outgoing accountant.

Can my existing accountant stop me from leaving?

They cannot normally prevent you from appointing another accountant.

However, unpaid fees or disputes over records may need to be resolved.

Is changing accountant expensive?

Not necessarily.

Costs may arise if records need correcting, overdue work must be completed or accounting software needs to be rebuilt.

Make sure any handover or catch-up costs are understood before appointing the new firm.

Is a larger firm always better?

No.

The right accountant is the one with the appropriate expertise, communication and service for your business.

A smaller firm with a dedicated contact and a strong understanding of your company may provide more useful support than a larger firm where your business receives less individual attention.

Final thoughts

Your accountant should be a reliable professional adviser rather than simply someone who files your accounts once a year.

It may be time to review the relationship where there are repeated problems with:

• Communication.
• Accuracy.
• Tax planning.
• Bookkeeping.
• Reporting.
• Commercial understanding.
• Technology.
• Trust.

Before changing, discuss your concerns and establish whether the service can be improved.

Where the relationship no longer meets your needs, changing accountant may provide clearer information, more proactive advice and greater confidence in your business decisions.

Merranti Accounting supports businesses with annual accounts, bookkeeping, management information, tax planning, VAT, payroll, cash-flow forecasting and business advice.

This article provides general information and should not be treated as personalised accounting, tax or legal advice. The services offered by accountants differ, so businesses should review their engagement letter before deciding whether to change adviser.

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Written by Jason Fudge

Jason Fudge is Managing Director at Merranti Accounting.

Jason works closely with business owners on the commercial and practical challenges involved in running a company and choosing the right professional support around it.

His experience includes business planning, financial management and helping owners use accounting information to make better commercial decisions. This gives him a practical perspective on what businesses should expect from an accountant beyond year-end compliance work.

For growing companies, the right accounting relationship should provide clear information, reliable communication and support that develops as the business becomes more complex. Jason’s focus is on helping business owners understand what they need from their advisers and ensuring financial information supports better decision-making.

View Jason Fudge on the Merranti team page or connect with Jason on LinkedIn.