Canada accountants, bookkeepers

How to choose an accountant in Canada

Basics of accounting

Accountants in Canada are governed by the Generally Accepted Accounting Principles (GAAP) of Canada. These provide the conventions, procedures, and guidelines for accounting in Canada.

Business accounting practices in Canada are influenced by the Canadian Institute of Chartered Accountants (CICA), the Certified General Accountants (CGA), the Society of Management Accountants of Canada (CMA), and the Canadian Academic Accounting Association (CAAA).

Why use an accountant rather than tax software?

A tax accountant can often help cut costs, minimize taxes, offer advice for investments, etc. While tax software can be useful for personal tax returns and basic business tax returns, an accountant is better suited to deal with more complex tax accounting tasks.

Accounting services

A good accountant should provide business advice, not just track your profits and loss. Some of the services that an accountant may provide includes: tax planning, business consulting, personal finances advice, accounting software recommendations, and networking within your business community.

Accounting designations

Your Canadian accountant may have one of the following designations.

A Chartered Accountant (CA) is the most internationally recognized accounting designation. Canada's CAs enjoy formal reciprocity arrangements with the United States, Great Britain, France, Belgium, Israel, South Africa and many other countries. The designation of CA requires that you complete a university degree. A Chartered Accountant is trained to prepare, review and analyze financial statements for both companies and individuals.

A Certified General Accountant (CGA) has much of the same training as a CA, but supplements this accounting knowledge with business and business management training. To become a Certified General Accountant, the accountant must complete a Bachelor’s degree, have a minimum of two years of approved practical experience in industry, government or public practice and complete the PACE level examinations.

A Certified Management Accountant (CMA) has management accounting training in addition to financial accounting knowledge. A Certified Management Accountant often has the leadership and management skills to participate in the decision-making processes of larger organizations.

In addition to these designations, some accountants are generalists while others specialize in certain areas such as cash flow, forensic accounting, tax services, etc.

Considerations when choosing an accountant in Canada

Length of time in business: depending on the complexity of your business and the type of industry you're in, you may wish to choose an accountant who has been in business for a while. This way, you can take advantage of the accountant's experience and lessons learned through the years.

Does the accountant have other clients in your industry: there may be specific considerations for accounting in your industry. As above, your accountant may have gained valuable experience from dealing with other clients in your industry. Ask if you can contact some of these clients for a reference.

What is the accountant's billing structure: some accountants in Canada charge a monthly retainer, others charge up-front, and yet others charge upon completion of the accounting task. Make sure that you're comfortable with the accountant's billing structure.

What services does the accountant provide: you should be looking for any added-value that the accountant can provide, such as business planning, investment advice, social networking, etc.

What types of technology does the accountant use: you want to ensure that the accountant is using software that is adequately supported in the industry, and that your data is sufficiently backed up. You should be able to get a copy of your data upon request.

Does the accountant work alone or as part of a team: there are advantages to having a one-on-one relationship with your accountant, but there are also risks if he or she does not have adequate coverage for illness, or if your accounting work becomes overwhelming.

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