The Client Acceptance Question

Source: Practical Accountant

This article is based on interviews of several firms about their client acceptance criteria and processes.

One of the major problems is getting individual partners to cede control over the process. Another is sticking to the standards, especially when so many new clients come through referrals. Using a client acceptance committee helps make the process more objective.

CPAs want clients who offer interesting work, have high ethical standards, and are compatible with the firm’s capabilities. They want clients with whom they can grow.

Create a description of the ideal client and measure prospects against it.

Firms should also evaluate existing clients in terms of qualities sought in new clients as well as profitability, payment history, and realization experience. Also consider the difficulty in working with the client.

The risk management question involves not only independence and conflicts of interest, but also potential for litigation and compatibility with firm capabilities.

Never sell clients services they don’t need.

Be sure to do due diligence, including background checks.

For the complete article, click here and select the article “Applying Criteria to Client Acceptance” in the October 2008 issue.

From Practical Accountant, October 2008, SourceMedia Inc., One State Street Plaza, 27th Floor, New York, NY 10004, 800-221-1809.