Accounting is crucial for every e-commerce business. Online retailers must record and categorize online transactions accurately and ensure their books are in order. Otherwise, problems start brewing.
It can be challenging to find accountants that understand the complexities of the e-commerce sector. What qualifications should they have? How do I find a trustworthy person? These are the questions e-commerce business owners often ask themselves. This article will give you tips for finding the right e-commerce accountant.
What Qualifications Does The Accountant Have?
The first factor to consider when choosing an accountant is their qualifications. A good one should preferably have a bachelor’s degree in accounting or business. If not, they should at least have completed accounting courses from professional colleges and educational institutions.
The accountant you choose should be certified, either a Certified Public Accountant (CPA) or Chartered Accountant (CA). The certification is a stamp that they have the knowledge required to perform complex accounting tasks.
Accountants can take courses on working with e-commerce businesses from local colleges or online learning platforms. Any accountant who has completed such a course is more suited to work for your online retail business.
Are They Familiar With Accounting Software?
Very few people record financial transactions with pen and paper, especially online businesses. Bookkeeping and financial record-keeping is primarily done via software, so your accountant should be familiar with accounting software.
Cloud-based software makes it easy to store and categorize financial transactions. You can link the software to your e-commerce tool to automatically import, record, and categorize every financial transaction. E-commerce accountants must know how to use software tools to keep records and generate reports. The good news is that these tools are relatively easy to learn. Any accountant well-versed in one tool can quickly learn to use another.
Do They Understand International Tax Treaties and Obligations?
Online retailers must pay value-added taxes (VAT) on sales, and the VAT rates differ for different countries, states, and cities. Accountants working for online retailers must understand the ins and outs of international sales taxes. They should know how to compute and pay taxes according to jurisdiction. Previous experience in managing sales taxes for online retailers is preferable.
Inventory Management Skills
Inventory management is the process of sorting and tracking inventory from manufacturers to warehouses to the point of sale. It is a crucial part of accounting for online retailers. Any e-commerce business that doesn’t track its inventory can unknowingly incur big losses.
Your accountant should understand how inventory management works and how it relates to keeping financial records. They should know how to use inventory management software to simplify the process and record accurate data.
Location
The location of your accountant matters because the closer they are to you, the easier they are to work with. The good thing about this era is that you must not hire an in-person accountant. Instead, you can use online accounting services for your e-commerce business. If you choose an online accounting service, the accountants you work with should be in a similar time zone as yours to make communication easier.
Pricing
Accountants don’t work for free. They charge money for their services, and choosing what you can afford is essential. Some accountants charge by the hour, some charge monthly retainers, and some bill flat rates depending on your requirements.
Choosing accountants charging monthly retainers or flat rates according to your requirements is advisable. It’s easy to estimate your bills beforehand if you choose these options. In contrast, you might not know how many hours an accountant needs to sort your financial transactions, and you’ll end up paying much more than expected.
Conclusion
We have listed the main factors to consider when choosing accountants for your e-commerce business. Follow our tips, and you’ll likely find one you’ll enjoy working with.
