How should you choose your accountant, financial …

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How should you choose your accountant, financial and tax consultants in Portugal?

THIS ISSUE is a huge problem for those who arrive in Portugal and want to establish their business. Quite often we hear, and read news about consultants, that do not do their job properly, sometimes causing irreparable damage to their clients’ affairs.

We sometimes hear that they have kept clients’ money and run away or that they intentionally supplied their clients with false information.Those affected are not usually the international companies, as most of them are audited, and major auditing companies have branches in Portugal to advise them. The main victims are small and medium companies that want to establish their business. Quite often they decide to enter their business in Portugal through their country’s Chamber of Commerce, which is a good way to begin, in order to become accustomed to Portuguese procedures. Some consultants are members of those chambers, but obviously the chamber doesn’t control their activities. Quite often the chamber doesn’t have a way to find out how that consultant works, and therefore cannot guarantee that the new associate has made a good choice.

For many years in Portugal, the fiscal authorities controlled the accountants, but as you may have read in my last article in The Resident, if they don’t have enough means at their disposal to inspect companies, how can they supervise the accountants as well?

Through the creation of an entity to control accountancy practices and all financial consultants, all businesses must now use a chartered accountant who is registered with the Câmara Técnicos Oficiais de Contas (CTOC), which is the Portuguese Chamber of Chartered Accountants. Everyone who is properly qualified to be responsible for the accountancy of businesses is registered with the CTOC. The creation of this chamber represented a huge step towards defending companies and sole traders.

This association created a code of ethics as well as statutes which all members should respect. These include rules that refer to the relationship between members, clients and the fiscal authorities.

It is very important when you are seeking to choose a chartered accountant to make sure that he or she is registered with the CTOC.

Before the creation of this professional association, in situations when an individual or company would have a problem with their consultant, the only way to force them to take responsibility was to make a complaint in court, as well as to the fiscal authorities.

Now, however, you have another option: you can present a complaint to the CTOC.

Since the formation of this body, the regulations for obtaining a license to work in this field have become more and more stringent. This is very important because it ensures that those practicing must perform their job not only according to the CTOC rules, but also according to the rules of the fiscal authorities.

Currently, new members are only accepted after they have completed a series of tests that verify their accountancy skills, statistical ability and knowledge of fiscal legislation. Despite the fact that all candidates nowadays must have graduated from secondary school in order to be accepted, this was not a requirement in the past.

Experience alone is no longer enough to be a good consultant; now we must also have other skills in areas related to the fields of accountancy and tax, such as management and psychology.

To avoid experiencing problems with your consultant, you should always try to seek a second opinion. Financial matters are no different from health problems or any other problems, where you should always search for a second or even a third opinion if possible.

The most common way to choose an accountancy consultant is through a referral from someone you know. This is always the best way to guarantee that you are making a good choice, but of course only if the person advising you is trustworthy.

To resume, choosing your consultant is not easy, but a wise choice can only be made after looking at several good options. One option is certainly not enough.