Rounding up the cowboys

To be a doctor, lawyer or haulier you need qualifications, and from time to time must prove you have them to stay on the right side of the law. Yet to be an accountant or professional adviser, you need only fix a brass plate outside an office, have a letterhead printed and you're in business.

The number of small businesses susceptible to cheap and poor advice from such "professional" advisers is increasing. A joint Confederation of British Industry and National Institute for Economic Research report shows the number of small businesses in the UK is growing by 10%; their number is this year expected to reach more than 2.7 million. These firms need good accounting and management advice. So where do they turn to?

There are three main recognised accountancy bodies in the UK: the Chartered Association of Certified Accountants (ACCA); the Chartered Institute of Management Accountants (CIMA); and the Institute of Chartered Accountants in England and Wales and its affiliates (ICAEW). But what do they offer in the way of free practical advice? Very little unless you are dealing with the ACCA.

To rid British business of shark-like "professional" advisers, the ACCA has launched a second pilot advice programme for small businesses, which could be available nationally within the next year or so.

Its first project, a sponsored Small Business Surgery in north Harrow, Middlesex, has finished its trial period and is being reviewed.

The second is similar in principle, but is being run by the Leicestershire District Society of the ACCA, in conjunction with Business Link Leicestershire.

Called The Accountancy Helpline at Business Link Leicestershire, the scheme has been put together with the owners of small and growing businesses in mind - people who do not regularly use the services of an accountant. The helpline provides information on matters as diverse as sources of finance, cashflow handling and the new self-assessment personal taxation regime.

Some 25 members of the Leicestershire District Society of the ACCA will take turns to provide a day's consultation. Where the question cannot be answered over the telephone, free face-to-face help is available for up to one hour from the member on duty. Thereafter, it is up to the enquiring individual to make their own arrangements.

George Sawyerr, president of the ACCA Leicestershire District Society, says: "As certified accountants, we would like to be seen to be helping small businesses, bearing in mind that professional costs of setting up and growing new business could be a major constraint."

Lutfi Talib, president of the Harrow District Society of the ACCA, says: "While many small business consultants are legitimate, others offer a cheaper service by cutting corners. This could prove to be a fatal false economy."

Safeguards

• Use an adviser who is a member of a relevant professional body, and ask to see proof of qualifications.

• Beware of cold-callers.

• Seek out references, either from other businesses in your area or market, or from the local Training and Enterprise Council.

• Do not relinquish direct control of finances of your business to an outside party.

• Monitor how much interest a prospective adviser shows in your business. Find out if they have any experience in your market.

• Ensure you have a detailed written contract. Are billing terms monthly, quarterly or annually? Will the adviser offer any help in minimising your bills?

• Find out if the professional body that regulates the adviser offers free guides or advice booklets.