Finding the perfect financial adviser

Your business is growing - but is your old accountant up to the job? Wilf Altman looks at the options

The accountants round the corner who helped you get the business started may no longer be the right professional advisers once the business is up and running. You may have reached a point when you need advice on such issues as compliance, tax planning, acquisitions, employment legislation or raising fresh capital.

The accountants round the corner who helped you get the business started may no longer be the right professional advisers once the business is up and running. You may have reached a point when you need advice on such issues as compliance, tax planning, acquisitions, employment legislation or raising fresh capital.

In a business environment that is daily becoming more complex, every growing business needs more professional help. How difficult is it to change to a larger firm of accountants with a wider range of specialist skills?

Colin Howe, managing partner of Hillier Hopkins LLP, a 15-partner firm of chartered accountants with offices in Aylesbury, Hemel Hempstead and Watford, says: "Most changes are made on a professional basis with a smooth transfer of information. Occasionally businesses in the process of changing accountants will leave some of the work with the smaller accountancy firm and go to a larger practice for specialist advice. The larger practice will always write to the client's previous firm to check whether there are any professional or specific reasons why they should not take the account."

The loss of a client seems tough for accountants who have given good service and worked hard to keep the business, but it need not be the end of the affair.

"We have a working relationship with many small accountancy firms in our area who do good standard accountancy work but aren't equipped to do, for example, strategic or tax planning," says Stanley Baskin, managing partner of Haslers, an 11-partner practice in Woodford, Essex, members of the UK 200 Group and winners of the recent Accountancy Age Medium Firms Awards. "When businesses grow, the temptation is to go to the big accountancy firms whose name will look impressive in the annual report, or when they are ready to produce a company prospectus, but big practices are not really appropriate for the smaller to medium-sized company and can't match the personal partner service offered by smaller firms."

The lesson is that if you've outgrown your present accountants and are not getting the services you need, start looking, but take your time to find the right alternative: a firm which will have an experienced tax partner, financial and strategic planning expertise. Today many medium-sized practices offer specialist advice in management buy-outs and buy-ins, IT and human resources support.

Talk to some of your business friends and associates. When you've collected a few recommendations, hold a "beauty parade", just as larger companies do when they want to appoint new stockbrokers or advertising agents.

The ideal accountants for the growing business combine the expertise of the larger practice with the more cost-effective and personal partner style of the smaller firm.

What tests can be applied to help you find such paragons?

* make sure the partners who impress you are the partners you'll continue to see

* check that they are prepared to acquire a practical knowledge of your business

* satisfy yourself that they will stay in regular contact and attend periodic management meetings

* find out if they are smart enough to spot any grants/subsidies to which you may be entitled

* can they handle due diligence and related issues if you decide to go on the takeover trail or plan an MBO or MBI?

* How good are they as business advisers

"Changing accountants shouldn't be taken lightly, but shouldn't be avoided either if you think it's necessary," says Jonathan Russell, vice-president, UK 200 Group, the national network of independent accountants and lawyers. "Your accountants must be considered as valued business advisers. If they don't fit that category, you should be considering a change. Just because someone comes highly recommended doesn't mean that person is right for you. Look around. Don't just go for the first alternative you meet or who happens to be recommended. Get the best - the one that suits you."

When you've found the right partners, use them to check whether your internal systems are kept running efficiently, or your accountancy fees could be a lot higher than necessary. Many fast-growing businesses are not always good at keeping proper records. Finding a solution to the problem is always postponed. The consequence is that at the 11th hour when the accounts are due there is a frantic race to get everything in order for the accountants and that could involve excessive time and costs.