Changing accountants? Here’s our ultimate guide to getting a new accountant

So your business is heading in a different direction and you think a new accountant will help achieve your growth goals? Changing accountants is easier than you might think.

What's the procedure for changing accountants?

Changing accountants is a relatively straightforward, five-step process.

1. Identify what you’re looking for in your new accountant
2. Decide who you’ll approach based on your criteria
3. Get to know potential new accountants to find out if they’re the right fit
4. Let your old accountant know you’re changing accountants with an ethical letter
5. Make sure your new accountant is given all the information they need from your previous accountant

What is an ethical letter?

An ethical letter is a document that’s sent to your previous accountant from your new accountant. Put simply, it’s a request for your financial records to be transferred; but it’s also a courteous way to let your old accountant know what’s happening with your accounts, and facilitates a smooth transition between firms. It is part of your new accountant’s due diligence to make sure there aren’t any professional or ethical reasons that they shouldn’t take you on as a new client – hence the name ethical letter.

We’ve already mentioned that changing accountants is easy, but there are a few things you can do to make the switch seamless.

Step 1: Identify what you’re looking for in a new accountant

Changing accountants is a great opportunity. It’s a chance to say goodbye to any problems you had with your old accountant and say hello to a whole new world of growth.

Regardless of your business’ situation, take stock of what you didn’t like about your old accountant, from communication challenges to the interest (or lack thereof) they showed in your business. Use this list of shortcomings to imagine exactly what you’re looking for in a new accountant.

Step 2: Decide who you’re going to approach to be your new accountant

If you’re wondering how to find a good accountant, we’d recommend asking people in your network for recommendations. Just like you wouldn’t recommend the accountant you’re trying to leave, other business owners are unlikely to suggest someone they don’t like. As with many things in life, finding the right accountant can come down to who you know, so make sure you’re asking around as widely as possible.

Finding the right accountant is also much easier when you’ve got clear criteria. Decide what your priorities are before you start looking, this will give you questions to ask when you’re given a recommendation, and help you filter results if you’re looking online. For example, many clients tell us their motivation when looking for a new accountant was to find someone who cares about their business as much as they do.

Step 3: Get to know your new accountant to find out if they’re the right fit

Understanding your needs and wants is helpful when discussing your business with potential new accountants. Even some of the best accountants might not be the best fit for you, and your business might not be the best fit for their services. We work with Australian businesses of all shapes and sizes, but some accountants specialise in particular industries or business structures.

At Project Alfred, we like to book a no-obligation, complimentary discovery call with clients before we work together to make sure we’re the best accountants for your needs now, and as you grow.

We totally get that you may feel uncomfortable discussing finances, especially if you’re going through a business downturn or feel like you’re behind on your obligations, so here’s some prompts to help you feel confident going into your first meeting with a new accountant:

Good to know: Questions to help you find the right accountant:

1. Do they specialise in the services that you need?
2. Who will be doing the work?
3. What are the costs and fees, and how are these calculated?
4. Are they registered tax agents and do they have a valid membership with accounting and tax associations?
5. How do they communicate with clients?
6. What technology do they work with?
7. What are their business goals and vision (and does that align with what you’re looking for in a business that operates as an extension of your own)?

Qualifications are important, but the quality of communication and the vibe you get matters too; you’ll be dealing with your new accountant on a regular or at least semi-regular basis, whether it’s face-to-face or virtually. Trust us – accountants that are good communicators DO exist 🙋 and we’re here to break all the stereotypes about people that crunch numbers!

Step 4: Let your old accountant know you’re changing accountant

Okay, so out of all the steps, this is probably the one that people feel most uncomfortable with, but it’s like tearing off a bandaid – it’s easier if you just get it over with.

Before you get in touch, review your original terms of service and check if you agreed to a notice period, or have paid for any work upfront. Depending on your situation, you might want them to finalise outstanding work, or you may want your new accountant onboard ASAP.

Regardless, it's courteous to let them know that you’re changing accountants. A letter or short email is usually the way to go, that way you have a clear record of communication. Generally, you just need to advise that you’ve reassessed your business priorities and found a new accountant who aligns better with your new needs.

Once you’ve accepted the terms of service with your new accountant they’ll start gathering all the information they need to run your books. If you’re not sure what to request when changing accountants, we’d recommend asking your new accountant to send an ethical letter. Accountants send these to request the financial information that they need from your old accountant – it’s a standard part of our client onboarding process at Project Alfred, so usually the only thing left for our clients to do is pop a bottle of champagne and celebrate the start of the next chapter for their business.

Get off to a great start – not just a good one – with your new accountant

All the best professional relationships and collaborations have one thing in common: great communication. Your new accountant should be proactive in wanting to understand your business’ situation, what you need from them, and what you’re hoping to achieve.

Check-in to make sure that your new accountant has everything they need to start running your books. It’s in your best interest for them to get off to the best start possible. Communication (both ways!) provides an opportunity for trust and rapport to develop, both of which are critical to getting off to a great start with your new accountant.

Reasons you might want a new accountant

Our clients tend to fall into three categories: those that need to change accountants because they're unhappy with their current set-up, brand new businesses, and businesses seeking external accounting expertise for the first time.

Unfortunately, we’ve found that many of our clients have had bad experiences, and when we first talk to them we often hear that their previous accountant:

• Doesn’t return calls
• Takes weeks to reply to emails (if at all!)
• Talks the talk but doesn’t have the right expertise
• Doesn’t submit lodgements on time, even though clients provided everything they needed a reasonable amount of time before the due date
• Made serious blunders
• Isn’t confident with business strategy and growth planning
• Isn’t on board with modern accounting best practices like cloud accounting and other efficiency-boosting technology

It’s important to know that not all accountants are like this, and you deserve a new accountant who cares about your business as much as you do.

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Want to find out why businesses across Australia are switching to Project Alfred? Book a discovery call with us today and find out how we can help your business grow.

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