As an entrepreneur, you have learned to wear a lot of hats – but you’re smart enough to know that you need a good accountant in your corner to handle the books.
Your accountant plays a critical role in making sure that your company’s finances are on track, your business remains financially healthy and you’re meeting all your tax obligations. That makes it particularly important to know how to spot trouble with your accountant when you see it.
The following are some signs that you may need to end your relationship with your current accountant (and maybe even take legal action).
They’re perfectly okay with a little fraud
If you’re applying for a bank loan and your accountant says, “What do you need the numbers to say?” or anything similar, that’s a huge red flag. Similarly, you should be wary of an accountant who promises to significantly reduce or eliminate your tax liability without a clear explanation of how that’s legal.
They can’t explain the paperwork
An accountant takes the burden of trying to make sense of the “bottom line” when it comes to your finances off your shoulders – but they should be able to explain complicated financial concepts in a clear, simple way. If they’re evasive or unwilling to explain their work, that’s a major sign of trouble.
You’ve missed deadlines
Nothing can get you into trouble faster with the Internal Revenue Service and other regulatory bodies than badly filed, incomplete or delayed forms. You should never accept an accountant’s excuse for missing tax filing dates and that should be an immediate cause for concern.
A bad accountant can cost you and your business a great deal. If you’ve been harmed by accounting malpractice, keep in mind that legal help is available.