How to Choose an Accounting Firm — 10 Questions to Ask

How to Choose an Accounting Firm — 10 Questions to Ask

We at Balansis have talked to plenty of business owners who've switched accountants. Almost every one of them says the same thing in the first conversation: "I didn't know what to ask." They picked their first firm based on price, a friend's recommendation, or how the website looked — and a year later ran into late filings, unexpected invoices, and silence exactly when they needed advice the most.

This article is our attempt to change that. We've built a framework of 10 questions any business owner can use to evaluate an accounting firm — including us. If a firm can answer these clearly and confidently, it has earned your attention. If the answers are evasive, vague, or suspiciously short — keep looking.

Key takeaways

• Since July 1, 2023, anyone providing outsourced accounting services in Latvia must hold a VID-issued license — without it, providing the service is prohibited, and you can verify it in a public VID registry

• Civil liability insurance is one of the conditions for obtaining a VID license — it isn't just "good practice," it's a mandatory requirement

• Certification from professional associations (such as LRGA) is voluntary — it doesn't replace the VID license and isn't a legal requirement for a typical outsourced accountant

• The cheapest offer on the market almost always means less attention for your business — price correlates with the level of accountability

• Before signing, get a written price list, a communication protocol, and a description of the exit process — verbal promises often don't match reality

Why the cheapest option usually ends up costing more

Before we get to the questions, one fundamental truth: in the accounting market, price almost always correlates with quality and, more importantly, with the level of accountability.

A firm offering bookkeeping for €50/month can only do that one way — by processing hundreds of clients at once with minimal attention to each. In that model, there's no time for consultations, no time for a thorough review of documents, no time for proactive tax planning. The client gets a "conveyor belt" service: documents get processed, returns get filed, but nothing more.

Our experience shows: a company with 20–30 transactions a month paying the lowest possible rate for an accountant often ends up losing more over the year — in missed tax optimization opportunities, penalties from missed deadlines, and time spent fixing the accountant's own mistakes — than it would have paid for a quality service. So the question isn't "how much am I paying?" but "what am I getting for that money?"

Question 1: Does the accounting firm hold a valid VID license?

This is the only question on this list whose answer has a direct legal basis — which is exactly why it should be asked first.

Since July 1, 2023, anyone providing outsourced accounting services in Latvia must hold a license issued by VID (the State Revenue Service). Without it, providing the service is prohibited, and an administrative fine can be imposed. The licensing regime has technically been in effect since July 1, 2021, but the first two years were a transition period — since 2023 it has been a strict requirement for every market participant.

Under the Accounting Law (Articles 34 and 38), to obtain an outsourced-accountant license, an applicant must meet several conditions: at least first-level professional higher education (college level) or academic higher education (at least a bachelor's degree) in accounting, economics, management, or finance; at least 3 years of professional experience in accounting; a copy of a civil liability insurance policy and internal control system documentation must be submitted; and the applicant must not have been convicted of intentional crimes against business or state service, or of terrorism-related offenses.

Source: Accounting Law (Grāmatvedības likums)

The practically important point: civil liability insurance isn't an optional extra safeguard — it's one of the prerequisites for getting the license. If a firm holds a valid VID license, it must also hold a valid policy — the law (Article 40 of the Accounting Law) requires a minimum liability limit of €3,000, or €5,000 if at least one client's net turnover exceeds €300,000. Still, the insurance question (see Question 5 below) is worth asking separately: the license shows that a policy had to be submitted, but it is worth confirming that it is current and what it covers.

What to ask: "Do you hold a valid VID outsourced-accountant license? Can you give me the license number?"

You can also verify the answer yourself — VID maintains a public Registry of Licensed Outsourced Accountants, where you can look up a specific person or company and confirm the license is valid. If a firm can't or won't name its license number, that's not a minor detail — it may mean the firm isn't legally allowed to provide you the service at all.

What about professional certification and associations? Latvia also has voluntary professional organizations, such as the Association of Accountants of the Republic of Latvia (LRGA), which run their own certification program. This kind of certification is not a legal requirement — the law doesn't set it as a condition for providing outsourced accounting, and a VID license can be obtained and maintained without it. It can be a useful additional credential for firms working with international clients or planning to expand their service range, but for a typical small or medium-sized business client, the VID license is the far more important — and genuinely mandatory — thing to check. (Separately, certification from the Latvian Association of Certified Auditors applies to an entirely different profession — sworn auditors, who perform statutory audits of companies — and isn't needed for a regular outsourced accountant.)

Question 2: Do you have experience in my industry?

Accounting for an e-commerce business looks fundamentally different from accounting for a construction company. Reverse-charge VAT in construction, the OSS regime for online stores, the VAT exemption for healthcare, customs procedures for importers — every industry carries its own specific challenges.

If an accountant is encountering your industry's specifics for the first time, they'll be learning on your dime — and mistakes will cost you.

What to ask: "Do you already have clients in my industry? Can you briefly describe the main accounting quirks of this industry?"

A good accountant will answer concretely, citing examples and specific challenges. A poor one will be evasive, saying "we work with all industries."

Question 3: Who exactly will handle my account day to day?

This is one of the most commonly overlooked questions, and it's the one that later causes the biggest disappointment. You meet an experienced, knowledgeable partner during the sales conversation, but after signing, your day-to-day point of contact becomes a junior assistant with no experience.

What to ask: "Who will be my primary point of contact? What's this person's experience and qualifications? Can I meet them before we sign?"

A professional firm can clearly name the responsible person and their qualifications. If the answer is "your account will be handled by a team," follow up with: "Who on the team is responsible for the quality of my account?"

Question 4: What's your communication process — and how fast do you respond?

An accounting relationship is a service where the quality of communication directly determines the outcome. If you have an urgent question about VAT treatment before invoicing a client, and your accountant responds four days later — you're in a bad spot.

What to ask:

1. "What's your typical response time to email? To a phone call?"

2. "Do you have a defined SLA (service-level agreement) with guaranteed response times?"

3. "What happens if my regular accountant is on vacation or sick?"

A good firm can name concrete timeframes — for example, "we respond to emails within 4 business hours." If the answer is "we always respond quickly," that's not concrete.

Question 5: What happens when you make a mistake?

Mistakes happen to everyone — even the best accountants. The question isn't whether a mistake will occur, but what happens afterward.

What to ask:

1. "Do you carry civil liability insurance? What does it cover?"

2. "If your mistake causes my company to receive a VID fine, who covers it?"

3. "Is your liability and its limits clearly defined in my contract?"

As noted in Question 1 — any firm with a valid VID license is already required to carry civil liability insurance, since it's one of the conditions for holding the license. That's why, if a firm can't produce an insurance policy or dodges the liability question, it's a much more serious signal than it might first appear — it may mean the firm doesn't actually hold a valid license at all.

Question 6: What exactly is included in your price, and what costs extra?

This is the question that causes the most misunderstanding and conflict. Many firms offer a low base price, then apply extra charges for almost everything.

What to ask:

1. "Is preparing the annual report included in the monthly fee? If not, how much does it cost?"

2. "Is payroll calculation included? What's the price per employee?"

3. "Is there a transaction-count limit beyond which the price changes?"

4. "What's your hourly rate for additional consultations?"

5. "Are there any hidden charges — for setting up EDS access, for organizing documents for the first time, for preparing an archive?"

Ideally, you should get a written price list that clearly separates what's included in the base service from what counts as extra work. If you'd like a sense of market pricing before the conversation, it's worth checking our own accounting services pricing first.

Question 7: Do you proactively warn about risks and deadlines?

A good accountant isn't just a document processor — they're your business's financial lookout. They notice when you're approaching the VAT registration threshold. They remind you about upcoming tax changes. They advise on when and how to pay dividends to optimize taxes.

What to ask: "Do you proactively inform clients about upcoming tax changes that will affect them? Do you track a client's turnover and warn them when they're approaching the VAT threshold or other significant limits?"

If the answer is "yes, that's part of our service," follow up with: "Can you give me an example from the past year where you proactively warned a client about an upcoming risk?"

Question 8: How do you help with tax optimization?

Not every accountant offers tax advice, and not every one does it proactively, but as a business owner it's worth understanding what support you can expect in this area.

What to ask:

1. "Do you actively offer clients legal tax optimization options?"

2. "Do you help clients choose between salary and dividends, or between the standard and alternative corporate income tax regime?"

3. "Do you recommend clients apply for EU fund support if you see they meet the criteria?"

A good firm will answer with concrete examples — how, when, and why it recommended specific clients switch to a more favorable tax regime or payout structure, rather than just generally asserting that "of course we do that."

Question 9: What's the exit process if I want to end the relationship?

This is a question rarely asked, but it matters enormously. If, a year or two from now, you decide to switch accountants, how easy or hard will it be to leave?

What to ask:

1. "What's the notice period in your contract?"

2. "Is there a minimum contract term?"

3. "Within what timeframe and in what format do you hand over documents to a client ending the relationship?"

4. "Is there an extra charge for preparing and handing over the document archive?"

If a firm avoids this question or says "we'll talk about that when it comes up," be cautious. A professional firm can clearly describe the exit process.

Question 10: What's your level of technology?

Accounting in 2026 isn't just spreadsheets. A modern accounting firm uses software that integrates with your bank, processes invoices automatically, and lets you track your own financial data.

What to ask:

1. "What accounting software do you use?"

2. "Do I, as a client, have access to the system to see my own data?"

3. "Does your system integrate with my bank for automatic transaction import?"

4. "How do you ensure data security?"

What to expect from a good accounting firm — summary

These 10 questions aren't meant to "catch out" an accountant — they're meant to let you, as a business owner, make an informed choice. We at Balansis are ready to answer every one of them in our first consultation, including naming our VID license — and we encourage you to ask these same questions of any other firm you're considering. The better informed the market is, the better service providers will have to be. If you'd like to learn more about our accounting services or get in touch with us for a direct consultation — we're happy to answer all 10 questions.

Frequently Asked Questions

Does every accountant in Latvia need a VID license?

No, only those providing outsourced accounting services — that is, working with multiple clients as an external service provider. An accountant who is an employee of a single company under an employment contract (not an external service provider) doesn't need a VID license.

How can I check myself whether a firm holds a valid VID license?

VID maintains a public Registry of Licensed Outsourced Accountants, where you can look up a specific person or company and confirm the license is valid and hasn't been revoked.

Does an LRGA certificate mean an accountant is more qualified than others?

LRGA (the Association of Accountants of the Republic of Latvia) certification is a voluntary professional program that can indicate additional knowledge, but it isn't a legal requirement and doesn't replace the VID license. A firm without this certification but with a valid VID license may legally provide exactly the same services.

What happens if an accounting firm provides services without a VID license?

It's prohibited and can result in an administrative fine. It can also create additional risk for your own company, related to whether the filed documents and returns actually comply with requirements.

Can you trust a new accounting firm without a long track record in the market?

Track record is just one factor. It's more important to check the specific team's qualifications, its VID license, and its answers to the other questions in this article — a new firm with an experienced team and a valid license can be a more reliable choice than a long-established firm with no clear accountability structure.

Does a cheaper offer always mean worse service?

Not automatically, but the correlation is strong. A very low price usually means a high client-to-accountant ratio, which limits the time a firm can devote to your business — for consultations, proactive planning, and catching mistakes.

Related reading: outsourced vs. in-house accounting and certified accountants and the VID license.

See also: common accounting mistakes in startups.

Sources

• Accounting Law (Grāmatvedības likums)

• VID: From July 1, 2023, providing outsourced accounting services without a license is prohibited

• VID: Registry of Licensed Outsourced Accountants

• Ministry of Finance: Outsourced accountants must obtain a license by July 1

• LRGA — Association of Accountants of the Republic of Latvia

We want you to choose an accounting firm based on real, verifiable criteria — not just price or first impressions. Get in touch with us if you'd like to ask us these questions directly.

Last updated: September 2026. Information is based on the Accounting Law, official materials from VID and the Ministry of Finance, and the Balansis team's experience in the accounting market.