Second Opinion

Tax season will always be a stressful time for business owners, just as it is for the millions of individuals and thousands of corporations racing to file returns by the fast-approaching deadline. But this time of year will provoke another anxiety for entrepreneurs in particular: Is the accountant who has been with you since you started the company still the right fit? Or is it time to make a switch?

For Stuart Reisch, 45, and Andreas Messis, 39, the answer to that question became clear over time. The co-founders of New Rochelle, New York-based Transform had often thought about expansion as the next phase for their organization and custom storage solutions company. "But any time we presented the idea of growth, it was always shot down," Reisch says, recalling conversations with their highly conservative accountant, who warned the pair about potential negative swings in the economy.

Reisch and Messis found a new accountant, Jeff Bernstein, through their membership in the Entrepreneurs' Organization, a global network of entrepreneurs from various industries. Bernstein worked with the pair for a year in preparation for expanding their footprint from New York City and Westchester County to the rest of the tri-state area, and he helped them relocate to a new manufacturing facility triple the size of their previous location. He also recommended they continue to spend 18 percent to 22 percent of revenue on advertising--a move that allowed them to grow at a steady clip out of the gate. "Jeff was a much more pro-active advisor," says Reisch.

The desire for help with business strategy is just one of the many reasons entrepreneurs find themselves reevaluating their accountant relationships as they grow. They wonder whether the number cruncher who helped them get off the ground is well-suited to service a $10 million-and-growing company. They may suspect they need an accountant who provides a wider array of financial services, handles audits or has more of an industry specialty. But before making a decision about whether and how to go about finding a new accountant, business owners should take a hard look at their plans for the future.

"If the founder is saying 'I'm really happy making money, the business is going well and I want to keep it that way,' you can probably suffice with smaller resources," says Richard Block, a CPA and adjunct lecturer of strategic cost management at the Graduate School of Business at Babson College in Wellesley, Massachusetts. "But if at some point you want to sell or buy somebody else, or acquire investing, you just made a decision that you're going to need a lot more [help]." You also need to look at what other constituencies, from banks to board members, expect. The answers will determine whether you want to find a small local firm or a large regional player.

Start your search by asking for referrals from trusted friends and colleagues. Once you have names, ask your local banker for his or her thoughts. Look for an accountant with at least five years of experience, including experience servicing companies in your industry as well as those of your size. If you're the smallest client, your new accountant may not have as much time for you. "You should be able to call up your accountant with a problem or a question and, outside of tax season, he or she should reasonably be able to get back to you within a couple of hours," says Anthony Sykes, a Los Angeles accountant who works with entrepreneurs.

That said, it can be a bit scary, not to mention uncomfortable, to think about severing ties with your longtime accountant. You may not want to lose the institutional knowledge, or you fear disrupting the continuity. "The way we suggest you deal with that is to put the current trusted business advisor on your board of directors so you can continue to receive that trusted business advice," says Lee Graul, national SEC director for BDO Seidman in Chicago. Or you can keep that accountant for your personal tax work, or possibly your corporate tax work with a review by the larger firm. Says Graul, "You don't have to just step off the cliff into the unknown of a new firm."