Monthly Archives: December 2014

How do I get good advice from my Accountant?

Every professional adviser (Solicitors, Accountants, Consultants, etc) takes pride in giving good advice.

However sometimes it feels hard to get the advice you’re looking for and in this case it usually turns out that no-one’s satisfied. Getting good advice means asking the rights questions

Compare business advice to going to see a Doctor: you go in and say “My arm’s been sore since I fell over”. They might say “You’ve got a broken arm, lets put a plaster on it.”

But if you said “Doctor, my big toe’s a bit sore.” they wouldn’t look at your arm… You didn’t ask them too!

Here are my tips to help make sure you get the advice you need from your adviser:

1. Remember that you’re paying.

In my experience most people expect not to understand what their professional adviser tells them.

Advisers are very clever, well qualified people who are engaged for what they know about their subject. But hold on: they are clever and well educated and so they should have the understanding and skills to explain the important points to their client.

One of the best bits of advice I was given when I started my training was that I should never leave my client’s office until I knew (and fully understood) the answer to the questions I had – it was unprofessional to go back and ask again.

The same applies in reverse, you’re the only person who really knows whether you understand the advice or not!

There's no such thing as a silly question

It’s not a stupid question – I don’t know what it is…

2. Expect to ask questions.

Don’t be afraid of asking a stupid question, if you’ve got a question then ask it!

This especially applies if you’re in a group. Everyone else will be nodding sagely in response to the advice, but if there’s something you don’t understand then I guarantee that you’re not the only one!

3. Think about what advice you need in advance.

You can’t expect good advice if you say to your accountant “Tell me what I need to know”.

You will get lots of advice, some of it will be big and you will probably get a bill that looks like you’ve had good advice.

What you need to say is something like “Tell me what I need to know about buying a business” or “Tell me what I need to know about suing another business” (I’ve had a busy week!).

Or better still you could say “Tell me what I need to do to … (choose your ending!)”.

This requires time and effort from you, which I guess is why it is often missing!

This raises an interesting point about advice from accountants.

A large proportion of their work is helping people make sure they are not paying more tax than they ought to. Grey HairSo when you sit down in front of them and say “Give me advice” they can often help you even if you haven’t specified what kind of advice you want.

But if it isn’t tax advice that you want…..

4. Make sure the advice you want is something your adviser can help with.

It’s always useful to add “Is this something you can help me with?” to your request for help.

To repeat what I said earlier, consultants like giving good advice. Their reputations are built on their knowledge.

If you ask them for advice in an area where they have little experience it is sometimes difficult for them to say “I don’t know about that”. You need to make it as easy as possible to point you in the direction of someone who does.

5. Let them know when they’ve hit the target

It’s easy to think that because you’ve paid the bill your adviser will be happy (they will be happy!).

But if the adviser really has solved your problem perfectly they will always appreciate a “thank you”. Just a phone call is enough, but in some way communicate that they gave you good advice.

On target

This helps them know that they understood what you wanted and gives you a relationship that will help avoid problems with points 1 to 4 in future!

What’s the right thing to do?

I was approached by a friend last week who was looking for someone to help them with their tax affairs.

Now, I don’t do tax: not because I don’t understand it, more because I have chosen to focus what I do on helping small businesses managing their finances and you need to do a lot of tax work to stay up to date on the different rules and allowances.

However this case was more interesting than it first seemed. My friend’s tax adviser was a family friend (of his) who had been handling his taxes for a number of years. It has come to light that the tax adviser had made mistakes in previous years which had cost his client a reasonable sum of money. When the errors came to light the adviser didn’t admit to the mistakes, they did their best to brush them under the carpet! My friend wanted to know what to do about it.

Dawn breaking

In purely business terms the answer is simple – move to a new accountant.

The adviser in question wasn’t qualified in any way. They had been on a course run by HMRC to find out how to complete tax returns and then set up as an adviser – legally that’s all it takes! (Well that’s not quite true: you don’t need to go on a course…)

Chartered Accountants (all qualified accountants are Chartered in some way) have to undertake rigourous training and lots of exams to prove they know their stuff. They also need to take out insurance against the possibility that they may make mistakes in order to protect their clients. I don’t think I can stress the advantages of using a Chartered Accountant highly enough.

So, it’s a simple decision… yes? But actually, no…

My friend feels that he can’t move his business to a new accountant because it would be awkward when he met the current adviser socially.

I offered to recommend an accountant in North Devon who could handle the tax affairs remotely (the business is in Scotland), and probably more cheaply. But my friend feels this wouldn’t remove the embarrassment.

I pointed out that the current adviser has other clients (goodness knows what’s going on in their taxes) and so wouldn’t want to make a fuss that exposed the mistakes that he had made, but again this didn’t counter the client’s fear of embarrassment.

At present it looks like the status quo will continue – albeit with my friend’s raised awareness to ask more questions about their tax bill. This is a totally unsatisfactory outcome from my perspective – effectively the tax adviser is being rewarded for mistakes that they have refused to own up to.

Grey Hair I can only hope they learn a lesson from this incident and improve their processes in future.