Questions for a Potential Accountant: What to Ask Before You Hire a CPA

Hiring the wrong accountant is expensive. Missed deductions and surprise tax bills can cost a small business real money. Disorganized books add cleanup time on top, which usually lands on your desk at the worst possible moment. The right accountant, on the other hand, can give you cleaner books and better cash flow visibility, with fewer tax surprises along the way.

The questions for a potential accountant below give you a practical way to vet an accounting professional before you hire. They cover interview questions and warning-sign answers, then show how to compare finalists before you sign an engagement letter.

Why You Should Interview a Potential Accountant Before Hiring

Interviewing candidates protects you from problems that usually show up too late: missed deductions, messy books, or cash flow issues no one flagged when they first appeared. Treat the hiring process the way you'd treat any other important hire. You're evaluating several things at once:

• Expertise: Do they have the credentials and industry experience to handle your situation?

• Communication: Will you actually be able to reach them, and will their answers be clear?

• Fit: Do their services match what your business needs at this stage?

• Cost: Is their pricing transparent and within your budget?

• Trust: Would you feel comfortable handing over your bank logins and tax records?

Those answers tell you whether the relationship will work after the first tax return is filed.

If you still need candidates to interview, Relay's accountant and bookkeeper directory is a good place to find verified professionals near you.

15 Questions to Ask a Potential Accountant or CPA

The questions below are grouped into six categories. You don't have to ask all 15; use the list as a menu and pick the ones most relevant to your situation.

Credentials & Experience

1. Are You a CPA, and Can I Verify Your License?

Start with credentials. Ask whether they're a licensed CPA or an Enrolled Agent (EA), then verify it before hiring. If they don't hold a credential, clarify that too. (See the FAQ at the bottom of this article for step-by-step verification instructions.) Other credentials worth knowing about are CMA (Certified Management Accountant, focused on internal financial management) and CFP (Certified Financial Planner, useful if you want personal financial planning alongside business advice).

The distinction matters because only a licensed CPA, EA, or attorney can legally represent you before the IRS; a general accountant or bookkeeper can't. Still, an uncredentialed bookkeeper can be the right hire for clean books and monthly categorization work. Use the credential question to understand what the person can legally do for you.

2. What Experience Do You Have in My Industry?

Industry-specific experience changes the quality of advice you'll get. A CPA who has worked with SaaS startups will understand deferred revenue and ARR, while one who works with restaurants will know tip reporting and food cost margins. An accountant who has never touched your industry will be learning on your dime.

Ask for specific examples of tax issues they've navigated. Maybe they handled an e-commerce sales tax nexus question or an R&D credit for a software client. Concrete answers beat theory here.

3. Can You Provide References from Businesses Similar to Mine?

References show how the accountant works after the sales call ends. Ask for two or three current or recent clients in your industry or at your stage of business. When you call them, ask about responsiveness, accuracy, proactiveness, communication, and whether the relationship has scaled with the client's growth. Hesitation or vague website testimonials in place of real references is a warning sign.

Services & Scope

4. What Services Do You Offer, and What Does a Typical Engagement Look Like?

Scope gets messy when “monthly accounting” means one thing to you and something else to the firm. Ask the accountant to walk you through exactly what's included at each cadence:

• Daily/weekly: Categorizing transactions and reconciling bank feeds, plus handling AP/AR if it's part of the engagement.

• Monthly: Closing the books and sending financial statements, with a review of core metrics.

• Quarterly: Estimated tax payments and sales tax filings, plus performance reviews if advisory work is included.

• Annually: Tax preparation and year-end planning, including strategy sessions.

Also clarify what the base fee covers versus what they bill as an add-on, such as payroll, sales tax filings, 1099 prep, advisory calls, or audit support. Getting clear on scope upfront prevents surprise invoices later. If your business runs on a Profit First or envelope-style cash flow system, with separate accounts for taxes, payroll, materials, and operations, make sure the accountant is comfortable working in that structure rather than trying to consolidate everything back into one ledger.

5. Who Will Actually Handle My Account Day to Day?

At larger firms, the partner you interview may not be the person in your books week to week. A staff accountant may handle the day-to-day work, while the senior CPA reviews and signs off. You should know upfront who your primary point of contact will be, what their qualifications are, and how often the senior CPA personally reviews your account.

6. What Financial Metrics Will You Track for My Business?

A monthly P&L is only the starting point. A good accountant recommends specific metrics based on your business model:

• Profit margins (gross and net) for nearly every business.

• Cash burn rate and runway for startups.

• AR aging for service businesses with long collection cycles.

• Debt-to-equity ratio if you're carrying loans or planning to raise capital.

• Customer acquisition cost and lifetime value for subscription businesses.

Ask why each metric matters for your next decision. The accountant should connect the number to what you'll do with it.

Tax Strategy

7. How Do You Approach Tax Planning Beyond Filing Season?

Tax planning should start before deadlines force your hand. Look for answers that include:

• Quarterly estimated tax planning so you're not blindsided in April.

• Entity structure reviews (LLC vs. S-corp vs. C-corp) as revenue grows.

• Retirement account strategies (Solo 401(k), SEP-IRA, defined benefit plans).

• Mid-year check-ins to model deductions before December 31.

• Tracking tax code changes that affect your industry.

If the candidate only talks about filing deadlines, keep pressing. Planning should happen while you still have time to change the outcome.

8. How Do You Make Sure I'm Getting Every Deduction and Credit I'm Eligible For?

Deductions and credits depend on the details in your books. Most tax preparers can fill out a return, but the real work comes in legally minimizing your tax bill. Ask whether they actively look for:

• Industry-specific credits like the R&D credit, WOTC, or energy credits.

• Section 179 and bonus depreciation for equipment and vehicle purchases.

• Home office deductions for owners working from home.

• Vehicle deductions (actual expenses vs. mileage method).

• Health insurance and HSA contributions for self-employed owners.

The answer should include specific examples of deductions they've found for past clients, beyond a promise that they'll review everything at year-end.

Technology & Process

9. What Accounting Software Do You Use, and Is It Compatible with Mine?

Software compatibility determines how much manual cleanup you'll face later. Confirm which platforms they're certified in, such as QuickBooks Online, Xero, or the tools you already use. Ask whether they prefer cloud or desktop and how their software connects with your business banking platform. If you bank with Relay, for example, transactions sync directly into QuickBooks Online and Xero, and your accountant can manage everything through a single Partner Portal login rather than chasing statements across multiple clients. Also ask how they use automation or AI to categorize transactions faster and prepare reports with fewer manual steps, including account matching.

10. How Do You Keep My Financial Data Secure?

Bank account details, payroll records, and tax IDs all pass through your accountant's hands. Ask specifically about:

• Encryption: Do they encrypt files in transit and at rest?

• Secure file sharing: Do they use a client portal (SmartVault, ShareFile, TaxDome) instead of email attachments?

• Two-factor authentication: Do they require 2FA for anyone accessing your data?

• Data retention: How long do they keep records, and how do they destroy old files?

• Access controls: Can they work in role-based view-only or limited-permission accounts rather than your full admin login?

Security questions shouldn't make the candidate defensive. They should already have clear answers.

Communication & Availability

11. How Do You Prefer to Communicate, and How Quickly Can I Expect a Response?

A response-time promise matters more when payroll is due or a tax notice shows up. Different accountants run very different operations. Some answer emails within an hour; others batch responses weekly. Clarify preferred channels, expected response times, meeting cadence, and tax-season availability. As a benchmark, look for accountants who commit to responding within 24–48 hours during normal periods and same-day during tax season. The goal is a steady rhythm year-round, with quicker responses when deadlines get tight.

12. How Do You Handle Audit Preparation and Support?

Audit support starts long before an IRS notice arrives. A good CPA keeps your records accurate and audit-ready year-round. Ask what documentation they maintain on your behalf and what role they'll play if you're audited. Does your fee include audit representation, or do they bill that work separately at a higher rate?

Pricing & Logistics

13. What Is Your Fee Structure, and What's Included?

Pricing gets hard to compare when every firm packages services differently. Accountants may charge hourly rates, monthly retainers, flat project fees, or value-based pricing tied to scope. Ask candidates to walk you through exactly how they charge, what triggers additional fees (extra advisory calls, payroll runs, amended returns), and how they handle ad hoc questions throughout the year. Always insist on a written engagement letter that spells out scope and fees before any work begins, and request written quotes from every finalist so you can compare apples to apples.

14. What Do You Need from Me to Get Started, and What Does Onboarding Look Like?

Onboarding should feel repeatable, not improvised. Expect a strong accountant to request:

• Prior-year tax returns.

• Bank and credit card statements (or read-only access to your business banking platform).

• Payroll records and 1099s issued.

• Entity formation documents (articles of incorporation, EIN letter, operating agreement).

• Existing bookkeeping files or access to your accounting software.

Ask what deliverables you can expect in the first 30, 60, and 90 days. If the answer is vague, that's a sign the firm doesn't have repeatable processes. Bonus points if they offer to handle onboarding for you. Accountants who work with platforms like Relay can often spin up your accounts and integrations directly through their partner login, which shortens setup by days.

15. How Will You Flag Risks or Savings Opportunities Before I Do?

Risk and savings conversations should start before you notice the issue yourself. Ask the candidate for a specific example of when they spotted a problem or opportunity before the client did. A strong answer sounds something like: "Last quarter I noticed a client was overpaying estimated taxes by about $12,000, so we adjusted the next payment and recovered the cash." That's the kind of practical impact you should expect.

Red Flags to Watch for When Hiring an Accountant

A few warning signs should disqualify a candidate on the spot:

• They charge a percentage of your tax refund. IRS Circular 230 prohibits contingent fees on original tax returns, and the AICPA Code of Professional Conduct restricts them. The practice also incentivizes aggressive filing positions that can trigger audits.

• They can't explain their work in plain language. If they can't explain their reasoning clearly now, expect the same once you're paying them.

• They guarantee a specific refund amount before reviewing your books. No ethical accountant can promise an outcome before doing the work.

• They pressure you to sign immediately. A good accountant wants you to make a clear decision, not a rushed one.

• They want you to sign a blank tax return. Never sign a return you haven't reviewed.

Reluctance to share references, lack of verifiable credentials (CPA, EA, or relevant bookkeeping certifications), and vague pricing are also disqualifying, but those are already covered in the questions above.

How to Evaluate Accountant Candidates After Your Interviews

Use a simple 5-point scorecard to compare candidates side by side. Rate each one from 1 to 5 on:

• Credentials: Are they verifiably licensed or certified for the work you need?

• Industry fit: Do they understand your business model and tax situation?

• Communication style: Will you actually enjoy talking to this person for years?

• Pricing transparency: Is the fee structure clear, written, and within budget?

• Gut feeling: Do you trust them with your bank logins and your worst financial news?

Weight credentials and industry fit most heavily if your taxes are complex. Weight communication and gut feeling more if you're a first-time business owner who needs a guide. The cheapest hourly rate isn't always the lowest total cost.

Hire a CPA for Your Business with Confidence

The right financial partner can change how you manage cash flow, plan for growth, and navigate tax complexity. The wrong one can quietly cost you a meaningful chunk of your bottom line every year. Use the questions, red flags, and scorecard above to compare candidates before you sign an engagement letter.

When you're ready to connect with qualified professionals, browse Relay's accountant and bookkeeper directory for verified CPAs and bookkeepers near you.

FAQs About Hiring an Accountant for Your Business

What's the Difference Between a CPA, an Accountant, and a Bookkeeper?

A bookkeeper records transactions, an accountant interprets and reports on them, and a CPA is a state-licensed accountant qualified to sign audited financial statements and represent you before the IRS.

• A bookkeeper records day-to-day transactions and reconciles accounts. No license required, but many hold certifications like QuickBooks ProAdvisor or Xero Certified.

• An accountant prepares financial statements, manages payroll, and handles general advisory work. No state license required.

• A CPA has passed the Uniform CPA Examination, meets state licensing and continuing education requirements, and can represent clients before the IRS.

None of these roles is automatically better than the others; it depends on what you need.

How Much Does a CPA Cost for a Small Business?

Fees vary widely based on region, firm size, scope of services, and the complexity of your business. Because pricing models differ so much (hourly billing, monthly retainers, flat project fees, value-based pricing), the only reliable way to know what you'll pay is to request a written quote and engagement letter from every candidate you interview. Ask each one what's included in the quoted price and what they bill separately so you can compare offers on equal footing.

When Should a Small Business Hire an Accountant?

The right time is when tax complexity, transaction volume, or time spent on bookkeeping starts costing you more than a professional would. Triggers to consider:

• You're considering an entity election (LLC to S-corp).

• You've hired your first employee and need payroll support.

• You're raising capital, applying for a loan, or selling the business.

• You're spending significant time on bookkeeping yourself instead of running your business.

• You've received an IRS notice you don't fully understand.

• Your transaction volume has outgrown what you can comfortably manage in a spreadsheet.

If one of those situations applies, the accountant's fee may be cheaper than the time and risk of handling it alone.

Do I Need a CPA or Just a Bookkeeper?

If your books are clean but your taxes are complex, you need a CPA. If your books are a mess but your taxes are simple, hire a bookkeeper first. A skilled bookkeeper can save you far more than they cost by keeping your records accurate and ready for tax season. Many small businesses eventually combine the two: a bookkeeper for ongoing transaction work and a CPA for year-end taxes and strategy. Add a full accountant (in-house or fractional) once you need payroll, high transaction reconciliation, and monthly financials.

How Do I Verify a CPA's License?

You can verify a CPA's license by searching your state's Board of Accountancy public lookup tool, which shows license status, issue date, expiration, and any disciplinary history.

• For CPAs: Search "[your state] Board of Accountancy CPA lookup" to find the official state database.

• For Enrolled Agents (EAs) and paid preparers: Use the IRS Directory of Federal Tax Return Preparers and confirm they have a valid Preparer Tax Identification Number (PTIN), which the IRS requires for anyone paid to prepare federal returns.

• For bookkeepers: Verify certifications directly with the issuing organization (e.g., QuickBooks ProAdvisor directory, Xero Partner directory, AIPB, or NACPB).

If a candidate can't be verified through one of these channels, walk away.