How To Start an Accounting Practice

By
IntelligentHQ

How To Start an Accounting Practice

Starting an accounting practice will take some hard work and persistence. The industry is booming, and modern technology can make starting a business effortless. However, you can’t expect to bring loyal clients in the door without a bit of elbow grease. So don’t expect the money to fall in your lap. In addition, there are some crucial steps to take before you can open your doors to the public. We will dive deeper into the critical steps below.

Obtain Credentials and Experience

To become an accountant, you’ll need to get a bachelor’s degree from an accredited college. Then you’ll need to obtain any other licenses necessary for your desired career path. For example, many accountants get their CPA credentials to provide services to the public. 

In addition to the proper certifications, you should gain some experience working for someone else’s accounting practice before starting your own. This way, you’ll learn the ropes and be better prepared for the hardships of running a business. Plus, you may be more likely to get funding and clients if you have a couple of years under your belt.

Choose Your Firm Type

There are several types of accounting firms to choose from, depending on your desired specialty – including:

  • Tax firms;
  • Auditing firms;
  • Forensic accounting;
  • Full-Service firm;
  • Outsourced accounting firm.

Write a Business Plan

A business plan is necessary if you seek the help of a partner or investor. But it is also essential for creating a path to success. When you write a business plan, you can prove that you know what you’re doing and can overcome any obstacle that should threaten your company. Additionally, you’ll need it when you register your business, as it will set a clear role for the leading managers and stakeholders to avoid legal conflict down the line. 

Establish Your Business

You need to make your business official by registering it as a legal entity – such as an LLC or S-Corp. Several online resources assist with the process, but it’s a relatively easy task to handle yourself if you put in the time to research. 

Once you’ve registered your business, you can obtain an Employer Identification Number (EIN) from the IRS and open a bank account for your company. In addition, you can start separating your business and personal finances from this point forward. This is necessary to protect your personal assets in a lawsuit against your company.

Location

The location of your business is essential, especially if you’re looking to rent office space. It’s wise to place yourself far enough from the competition and in a heavily trafficked area to be noticed. However, in the age of digital marketing, you can very efficiently work from home to cut costs.

Funding

Now that you’ve got the basic foundations of your company established, you need to acquire funding. There are many ways to find funds for your business, including pitching investors, applying for a bank loan, or applying for a grant. However, to increase your odds of approval for a grant, you should consider hiring a professional grant writer to help.

Tools

Accounting is not an easy job, and you can build a client base quickly. Therefore, you’ll need the proper accounting practice management software to help you track and complete projects on time – while communicating effectively with your employees. Communication is especially key if you operate remotely. Then, you’ll need a scheduling tool, virtual conferencing software, a website, and a business email for professionality. These are just some of the key building blocks, and you may find yourself needing more later on. Remember to start with the necessities so you’re not overspending. Then, reassess and add as you go.

Finding Clients

Pitching to potential clients can be nerve-wracking, especially when working with cold leads. There are platforms, such as Upwork, that can connect you with clients. However, it may be best to organically grow your company by building trust and establishing authority online. You can do this through blogging and social media marketing. 

You’ll quickly attract your ideal customers when you create engaging and informative content. For example, people love to learn about saving money, getting out of debt, and building wealth. So giving them valuable snippets of information for free can provide them with an incentive to go to your website to learn more about your business. 

Conclusion

Starting an accounting practice is hard work, but it’s worth every penny and minute of your time if you find passion in helping others manage their finances. To avoid overwhelm and burnout, take things one step at a time. You may feel the need to rush into it, but you’ll find that everything will come together quickly if you take your time. Plus, trying to do it all at once leaves room for errors that force you to backtrack. Also, consider hiring professionals to help you get things done. That way, you’re not taking on the entire burden of launching your business.

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