Do Not Use a Big Accounting Firm for your SRED!
I’m not here to slag accountants.
But this is a topic I feel strongly about.
In my opinion, your SRED requirements will not be well-served by putting them in the hands of one of the big accounting companies.
What bugs me the most about this topic is when I run into a non-claimer/first-time SRED claimer who declares: “Big Accounting Co X charges the most! They have the top brand name! They must be the best firm for me to trust with my SR&ED claims!
There are several reasons for this. I’ll go into three of them here.
The first and most basic problem with using a big (or any) accounting firm for your SRED is they will inevitably focus on the accounting aspects of your SRED claim. Assembling an excellent SRED claim requires laser focus on the technical aspects of the claim. The strength of your claim, and the way it is evaluated by the CRA, is determined almost entirely by the technical merit of it’s project write-ups. The accounting aspects of assembling a SRED claim are clerical in nature. If you have a regular, garden variety SRED claim, your claim will be assembled by accepting the defaults in the accounting software package used. The expertise in assembling a SRED claim resides entirely in assembling and then properly characterizing all your qualifying work. That has zero to do with accounting.
Pay for Steak. Receive Hamburger.
If you talk to a big accounting firm about taking on your SR&ED, you will be dealing with senior executives. If you are a larger customer, your accounting Partner will bring in the firm’s top SR&ED executive plus a SR&ED technical expert and a SR&ED accounting expert. This isn’t super relevant, but none of these SRED folks are on the partner track at the accounting firm. What IS relevant is that you will not see these SR&ED experts again after you sign a contract for the big accounting company to prepare your SRED. Your SRED will be prepared by an associate. Possibly a junior associate. We know the quality of this staff is poor. Why? Because boutique SRED firms compete vs accounting firms for the labour pool of competent SR&ED technical writers. We always win this fight and get our pick. Accounting companies uniformly pay poorly for SRED technical expertise. And there is limited path for advancement of SR&ED personnel in an accounting firm. Partner track? Don’t make me laugh.
So. Use a big accounting firm for your SRED? You’ll be paying for steak. But you’ll be eating hamburger.
SRED personnel turnover/merry-go-round
If you use a big accounting firm for your SRED, expect to break in a new technical lead every year or two. SR&ED technical personnel don’t stick around in accounting companies. Poor pay. Limited advancement. No management focus in the firm on the SRED practice.
Of course the quality of your claim suffers as you train a new SR&ED tech on your unique environment. There’s no synergy or memory to draw on your past claim history. Your claim takes longer than it should to prepare as you try to bring junior, new staff up to speed.
So there’s three reasons why you shouldn’t use a big accounting firm for your SR&ED. No technical focus. Pay too much for mediocre quality. Meet (and train!) new people!
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