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Everything You Should Know Before Hiring a CPA

  • Writer: DM Monticello
    DM Monticello
  • Jun 20
  • 8 min read

Hiring a Certified Public Accountant (CPA) is more than just filling a role—it’s investing in professional expertise that brings credibility, strategy, and compliance to your finances. Here's how to find and onboard the right CPA accountant.



What Makes a CPA Different from a Regular Accountant

In the U.S., only licensed individuals who pass the Uniform CPA Examination and meet educational/work requirements can use the CPA designation dimovtax.com. Key advantages include:

  • High-level expertise in complex tax planning, audits, and financial statements

  • Regulatory ability to offer attestation, auditing, and signing off financial reports 

  • Strict ethical and educational standards, including ongoing professional education (CPE)

For businesses facing regulatory demands, needing audit-ready financials, or exploring financial strategy, CPAs offer more security and utility than non-certified accountants



1. Define Your Needs & Objectives

Before hiring, clarify what you need your CPA to handle:

  • Tax compliance (federal, state, business, trust returns)

  • Audit or attestation work

  • Strategic planning like expansion, mergers, or entity structure

  • Financial reporting to lenders or investors

  • IRS representation and audit defense

Create a checklist of services, fees, and outputs you expect, including the formats, frequency, and timing of reports (e.g., monthly, quarterly, annually).



2. Decide: Individual vs. CPA Firm

  • Solo CPA or small practice: Personalized attention, potentially lower fees, but may have limited service offerings.

  • Larger CPA firm: Broad specialization (audit, forensic, consulting), scalable but costlier .

Align the choice with your business size, needs, and expectations for support.



3. Craft a Strong Job Description or Engagement Brief

If hiring directly:

  • Title: CPA Accountant

  • Scope: tax filings, audit prep, advisory, outsourcing needs

  • Software: QuickBooks, Xero, ProConnect, Drake

  • Industry experience: Specify verticals like SaaS, real estate, e-commerce, nonprofits

  • Credentials: Active CPA license in your jurisdiction, mobile compliance rights

  • Engagement type: Permanent, part-time, project-based, or retainer

  • Budget range

For firms: request tailored proposals detailing service tiers, deliverables, communication, and pricing.



4. Find and Vet Potential CPAs

Where to Look

  • IRS’s Directory of Federal Tax Return Preparers

  • State CPA societies and the AICPA

  • Referrals from peers or financial advisors

  • Online directories & local business groups

Red Flags During Vetting

  • CPA title used without proof—verify via state license lookup or IRS database

  • Lack of continuing education or mobility recognition in your state

  • No casework in your pertinent industry



5. Interview: Ask the Right Questions

Prepare focused questions like:

  1. Licensing & Credentials

    • Are you licensed as a CPA? Good standing and active in my state?

  2. Industry Experience

    • Have you worked with clients in my industry? Can you share results?

  3. Technical Tools & Processes

    • Which software do you use? Do you provide cloud access?

  4. Scope of Services

    • Will you perform tax planning, audits, financial forecasting?

  5. Methodology & Communication

    • What's your process for month-end closing or audit prep? How often will we meet?

  6. Fees & Deliverables

    • Hourly or flat-fee? What's included, and how do change requests work?

  7. Representation

    • Can you represent me before the IRS, if needed?

  8. Client References

    • May I speak with current clients in similar industries?

Use this opportunity to evaluate professionalism, communication, and depth of understanding.



6. Compare and Negotiate Proposals

Review submissions across key dimensions:

  • Clearly defined deliverables and timelines

  • Transparent pricing with breakdowns

  • Tech stack aligned with your system

  • Security measures: portals, encryption, 2FA

  • Terms: engagement length, renewal, and exit clauses

Choose a provider offering reliable quality, timely insight, and secure operations—not necessarily the lowest cost irs.gov+3turbotax.intuit.com+3investopedia.com+3tgg-accounting.comen.wikipedia.org+1investopedia.com+1.



7. Onboard Your New CPA Efficiently

Use an onboarding checklist including:

  1. Transfer historical financials and tax filings

  2. Grant software & portal access

  3. Schedule introductory sessions

  4. Align reporting deadlines (e.g., monthly/quarterly close)

  5. Review security protocols (password management, vaults, 2FA)

Make sure your new CPA understands your current systems, needs, and business context.



8. Evaluate Your CPA’s Performance

Once your CPA is onboarded, assess their contribution over the first 90 days and beyond using the following metrics:

Accuracy

  • Are financial statements error-free and aligned with industry standards?

  • Are all tax filings precise, with proper documentation?

Timeliness

  • Are monthly closes and reports delivered on schedule?

  • Are quarterly or annual tax filings submitted without extensions?

Strategic Value

  • Is your CPA offering forward-looking insights—cash flow projections, tax planning, scenario analysis?

  • Have they found any ways to reduce costs, improve margins, or mitigate financial risks?

Communication

  • Do they explain complex matters in simple, actionable terms?

  • Are response times fast (24–48 hours standard)?

Compliance and Security

  • Are documents shared via secure portals?

  • Is there audit-ready documentation and version control?

Document your expectations and revisit performance quarterly, adjusting scope or goals accordingly.



9. Red Flags to Watch For

Sometimes, the wrong hire can be costly. Look out for:

Poor Record-Keeping

If reconciliations don’t match, transactions are misclassified, or reports vary month-to-month with no explanation, it’s a sign of weak controls.

Avoids Questions

If your CPA can’t explain why you're paying penalties, missing out on deductions, or how they arrive at conclusions, transparency is lacking.

Misses Deadlines

Repeated delays with no heads-up signal bad project management—or worse, burnout or overbooking.

Scope Creep or Billing Confusion

Your CPA should be upfront about hourly vs. flat fees. Surprise bills mean it's time to reassess.

Non-Secure Practices

Sending sensitive data over email, no use of 2FA, and failing to update software is dangerous.



10. CPA vs. Other Financial Roles: When to Upgrade

Role

Scope

When It’s Enough

When to Upgrade to CPA

Bookkeeper

Data entry, reconciliations

Basic operations, low-volume finances

Scaling, tax season, audit prep

Accountant

Financial statements, cash flow

Internal reporting

Formal audits or multi-entity control

CPA Accountant

Compliance, IRS filings, audit defense

Complex tax situations, lenders involved

In most cases, they’re the ceiling

Virtual CFO

Strategic vision, board reporting, funding

High-growth startups or pre-IPO

Combine with CPA for full-stack finance

If you're hiring multiple roles, a CPA can oversee bookkeepers and interface with legal and compliance teams for high-level assurance.



11. Growing with Your CPA: Long-Term Engagement Tips

A great CPA accountant becomes a trusted partner—not just a service provider.

Quarterly Planning Meetings

Hold structured reviews with agenda items such as:

  • Financial goal tracking

  • Budget-to-actual comparisons

  • Strategic tax moves (e.g., deferrals, entity shifts)

  • Growth plans (e.g., hiring, expanding, raising capital)

Process Improvements

Ask your CPA to suggest workflow optimizations in billing, payroll, or expense tracking. They often have cross-industry best practices to share.

Tax Strategy Year-Round

Don’t just show up in April. Year-round planning includes:

  • Estimated quarterly taxes

  • Tax loss harvesting

  • Deduction optimization

  • Entity conversion if needed (e.g., LLC to S-Corp)

Help with Fundraising or Loans

Your CPA should support due diligence, assemble lender-ready statements, and explain ratios that affect your creditworthiness.



12. What If You Outgrow Your CPA?

Even the best relationships sometimes need to evolve. Consider transitioning if:

  • They can’t keep up with volume or complexity

  • You’ve moved into a regulated or publicly-facing market

  • You need global accounting support (e.g., subsidiaries abroad)

  • They resist modern tech or automation

In this case:

  • Provide written notice per your agreement

  • Request all working files and historical documentation

  • Revoke tool access securely

  • Arrange overlap or transition support from the new provider



Real-World Scenarios of Hiring a CPA Accountant

Understanding how businesses and individuals benefit from hiring CPA accountants in real-world situations makes the decision more practical. Below are examples across different industries and use cases.



Case 1: Startup Founders Scaling Fast

Business: SaaS startup in California Problem: Founders were managing books themselves, leading to messy records and tax confusion.

CPA Role:

  • Reviewed cash burn and revenue recognition policies

  • Implemented ASC 606 compliance for subscription billing

  • Designed investor-grade financial reports

Result:

  • Clean, audit-ready books for Series A fundraising

  • Found $12,000+ in missed deductions for R&D credits

  • Implemented monthly close procedures and board updates

Lesson: A CPA becomes critical when you scale and seek outside funding.



Case 2: E-Commerce Business With Global Sales

Business: Shopify & Amazon seller with U.S. and EU sales Problem: Sales tax was mismanaged, and the company was at risk of penalties in multiple jurisdictions

CPA Role:

  • Implemented Avalara to track and file nexus-based taxes

  • Structured international sales for VAT compliance

  • Cleaned up 18 months of inaccurate revenue categorization

Result:

  • Reduced sales tax liability by 22%

  • Passed due diligence review for business acquisition

  • Found $7,800 in back-dated deductible expenses

Lesson: Online businesses with global exposure must hire CPAs for regulatory protection.



Case 3: Construction Company with Payroll Complexity

Business: Mid-size construction firm with union labor and subcontractors Problem: Misclassified workers caused IRS and Department of Labor flags

CPA Role:

  • Created clear contractor vs. employee documentation

  • Managed certified payroll reporting for government jobs

  • Liaised with the CPA’s legal network to avoid audits

Result:

  • Avoided $20,000 in fines

  • Integrated Gusto with job costing software for labor tracking

  • Reduced accounting admin time by 40%

Lesson: Labor-heavy industries need CPAs who understand nuanced classifications.



Case 4: Freelancer Switching to S-Corp

Client: Graphic designer making $150K/year Problem: Paying too much in self-employment taxes as a sole proprietor

CPA Role:

  • Reorganized business into an S-Corporation

  • Structured reasonable salary vs. distribution

  • Set up quarterly tax planning cadence

Result:

  • Saved ~$12,000 annually in payroll taxes

  • Filed accurate W-2s and 1120S returns

  • Set up an S-corp retirement plan with CPA’s advice

Lesson: Even solopreneurs benefit significantly from proactive CPA guidance.



Case 5: Nonprofit with Grant Audits

Organization: 501(c)(3) serving youth education Problem: Lacked formal tracking for restricted grant funds

CPA Role:

  • Implemented fund accounting using QuickBooks Nonprofit

  • Segregated accounts by donor intent

  • Prepared clean audit reports for federal and private grantors

Result:

  • Passed all annual audits with zero findings

  • Maintained 501(c)(3) compliance

  • Increased grant award rate by showing financial transparency

Lesson: Nonprofits need CPA support for compliance, reporting, and funding credibility.



CPA Tools Used Across Cases

Tool

Purpose

QuickBooks Online

Daily bookkeeping & financials

Gusto

Payroll & contractor payments

Avalara

Sales tax calculation and filing

ProConnect / Drake

Tax return preparation (business/personal)

Bill.com

Vendor payments and AP automation

SmartVault

Document sharing with encryption

Google Sheets

Custom financial models



CPA Hiring Models That Worked

Model

When It’s Ideal

Example Use Case

Retainer (monthly)

Consistent reporting and tax needs

Monthly closes, QBO management

Hourly

Project-based or sporadic needs

Amending prior tax returns

Firm engagement

Complex needs or multiple team roles

Audit + bookkeeping + advisory

Part-time W-2

High-touch control without full-time

Startups pre-funding round



Questions These Clients Asked Before Hiring

  • “Can you explain how my current setup exposes me to tax risks?”

  • “What experience do you have with SaaS companies under $1M ARR?”

  • “Do you specialize in nonprofit compliance with federal grants?”

  • “How would you reduce my estimated taxes legally?”

  • “What tech stack do you use and how secure is it?”



What All These Clients Had in Common

  • They sought not just compliance but insight 

  • They understood accounting was not just an expense—it was an investment 

  • They evaluated the CPA as a partner, not a task-doer 

  • They integrated their CPA into strategy, not just operations


Conclusion: Hiring a CPA Accountant Sets the Foundation for Financial Success

When you hire a CPA accountant, you’re choosing a partner to protect your business, grow your finances, and unlock opportunity. The best CPAs deliver:

  • Transparent, audit-ready financials

  • Proactive tax strategy and compliance

  • Peace of mind when navigating complex decisions

  • Actionable data to fuel growth

Don’t rush the process. Take the time to define your needs, vet candidates carefully, and invest in long-term alignment. The returns go far beyond bookkeeping—they compound through clarity, control, and smarter strategy.

Hiring a CPA accountant is one of the most powerful financial decisions an individual or business can make. The right hire can drive clarity, savings, compliance, and long-term growth. Through real-world examples and strategic engagements, you now see how the benefits compound over time.



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