Question of the Month: How do I select the right accounting firm for my real estate business?

Working with the right accounting firm is invaluable to your real estate business. The accounting firm you work with should become part of your team and decision making process, identifying issues before they become problems, and providing solutions to positively impact the business. Finding the right one can take time and effort, but will save your business money in the long run. The selection of accountants and firms to choose from can be overwhelming; whether you are connected with a potential firm through word of mouth, through a listing, or even by an Internet search, there are certain factors that should be considered in your search. Industry Expertise In the real estate industry, success is dependent upon the sound management decisions, the prediction of future trends and the guidance of a trusted business advisor. This industry is prone to economic fluctuations, which can cause a strain on planning, operations and cash flow. With industry experience comes perspective and focus that can help you best leverage your own capabilities and resources. An accounting firm that is knowledgeable in the industry should have experience dealing with rental buildings, residential and commercial real estate, as well as finding tax saving solutions, strategies, and opportunities to accelerate growth and maximize profits. In addition, accountants who are highly skilled in certain industries will typically be involved in industry publications, professional organizations and associations. Active involvement in these types of groups usually corresponds to the accountant being on the pulse of industry news, regulations, and rules. Besides industry groups, proactive accountants will typically maintain a membership with the American Institute of Certified Public Accountants (AICPA), state societies of CPAs, and other professional groups that provide the latest in accounting and tax changes to members. Firm Qualifications The quality of the financial statements produced by a firm is a considerable factor in your decision making process. The American Institute of Certified Public Accountants requires firms preparing audited, reviewed and compiled financial statements to be reviewed by another CPA firm every three years to make sure the firms' financials and work papers are completed in compliance with required standards. Check to make sure that the firm that you are considering has passed peer review, showing that there is adherence to standards and full compliance with quality standards and practices. Aside from professional qualifications, it's always a good idea to ask for references or inquire about the firm's reputation at organizations, associations and industry groups. Take time to research the firm's digital presence; a frequently updated website, links to newsletters, news or other industry related material show that the firm is up-to-date. This is usually a good way to find what publications the firm is frequently in, events that the firm holds and awards/nominations the firm has received. Firm Size & Cost Selecting an accounting firm to choose can be a daunting experience, one way to narrow down the search is to focus on the size of the firm. Some businesses look to employ a large, national firm. You should first consider the size of your business before seeking to work with a large firm where a small business client might be overlooked. Often times, larger firms subcontract work or assign it to junior staff. Working with a small to mid-sized firm can give you a more personal relationship with your accountant. Before committing to a larger firm, familiarize yourself with who will be handling your account and clarify the goals you wish to achieve while working with them. Evaluate the premium cost you might be paying for selecting a large firm over a small to medium-sized firm. In many cases, the smaller firm can provide the proactive accounting services your business needs without the cost. Firm Policies In addition to making sure you're personally comfortable with your accountant, make it a point to see if your communication expectations are aligned with what the firm's communication policies. Technology has made it possible for quick responses via calls and emails. Mayer CPAs has made it a policy to return a call or e-mail within 24 hours. Our constant communication with our clients allows us to go behind the traditional services you would expect from an accounting firm. When financial issues need to be addressed, you want to work with an accountant and firm who make you a priority and who will answer in a timely fashion. In addition, you also want to make sure that the communication is not one way and that you are also being contacted by your accountant. A proactive accountant should contact you throughout the year with advice and recommendations, and be aware of any issues before they become real problems. Value from an accounting firm means quality service, a progressive attitude and a relationship you can count on. Other ways that accounting firms can provide value-added service is by acting as a mentor to guide you in you businesses financial decisions. Mayer CPAs strives to include the client in all aspects of the decision making process so that they understand the thought process behind each decision that is made. Choosing an accounting firm is one of the most important hiring decisions you can make for your business. Be sure you take the extra time to take all of these factors into account to make sure you have the right match. When making your final choice, try not to be persuaded by factors that may not portray an accurate of vision of what your firm will be receiving. Spending the time to find the right accountant is an investment in helping your business reach the next level of growth. Robert Mayer, CPA is the managing partner of Mayer CPAs LLP, Syosset, N.Y.