Do accountants charge too much?

[Emma]

Do accountants charge too much for what they do? Is it simply cutting and pasting in figures into a spread sheet then working out the sums? If you're an accountant, do you sleep at night?

[Dave H]

My dad doesn't sleep... but I think that is more to do with him being a Dark Lord of the Sith, rather than an accountant - However, I shall ask him the question tomorrow and see what response he gives

[tss4info]

... and that has to be a subjective judgement on your part (often best based on 'word of mouth').

Your accountant should be both willing and able to help you to reduce accounting costs.

As a first step, separating your bookkeeping and accounting needs will usually show a significant saving. The "convenience store" does give you one-stop-shopping, but at a price!

[DIY Accounting]

Originally Posted by Emma

Do accountants charge too much for what they do?

Like any other business accountants generally charge what the market will stand. And as professionals with expert knowledge and experience the vast majority of clients regard the accountant fees as an essential cost.

Statistically companies run by salesmen achieve the highest growth rates but companies run by accountants make the most profit.

Originally Posted by Emma

Is it simply cutting and pasting in figures into a spread sheet then working out the sums?

Accountants are required to achieve degree status and then spend several years learning accounting,tax and a range of financial specialist areas and only achieve their professional qualification when they can also demonstarte sufficient practical experience to support that academic achievement.

So anyone who thinks that all an accountant does is copy and add up is stupid !

Originally Posted by Emma

If you're an accountant, do you sleep at night?

These days Yes but when in 2006 I spent 15 to 18 hours a day, 7 days a week for a solid year, applying my academic expertise and 40 years of practical experience designing my accounting packages then No I didn't sleep much.

[xbp]

Originally Posted by Terry Cartwright

Accountants are required to achieve degree status and then spend several years learning accounting,tax and a range of financial specialist areas and only achieve their professional qualification when they can also demonstarte sufficient practical experience to support that academic achievement.

So anyone who thinks that all an accountant does is copy and add up is stupid !

In a similar way to doctors, accountants also specialise. I know a couple of them who get sick of being asked if they can "do the books" for startups - their expertise lies elsewhere.

[Peter W]

Originally Posted by tss4info

As a first step, separating your bookkeeping and accounting needs will usually show a significant saving. The "convenience store" does give you one-stop-shopping, but at a price!

It depends on the size of the business. With smaller businesses, there are a lot of efficiency savings through having the same brain doing the whole job.

[Emma James]

lovely flame fanning post

"Do accountants charge too much for what they do? Is it simply cutting and pasting in figures into a spread sheet then working out the sums? If you're an accountant, do you sleep at night?"


I'm wholly incompetant with figures and thus I'm wholly reliant on my accountant who I learnt of via one of my clients (he subsequently became my stationary designer).

He and his wife are quite simply marvellous. They're very thorough, efficient, personable, keen to help and I'd refer local businesses to them in a nanosecond. What's more, they turns my accounts around within 7-14 days. I'm one of their "better" clients because I submit my accounts once I have my bank statements up to date and they transmit the information over online so no fines here thank you and they save me money through their careful accountancy.

To add to the idolisation factor, they even fill various forms out for me which I could do of course but laboriously saving me not only time but hair which I pull out in handfuls when something isn't readily within my capabilities.

For the financial dunderheads like myself, I say leave it to the professionals and outsource, outsource, outsource, plus I'm a member of the FSB so in the event of a random tax investigation I'm covered against costs racking up with my accountant who would be instructed to act on my behalf.

[Tamborrada]

They sound great, but what should a fair charge be for completing a tax return and a set of modest books?

[Ray Stewart]

Originally Posted by Tamborrada

They sound great, but what should a fair charge be for completing a tax return and a set of modest books?

A lot depends on the definition of "modest set of books". I have seen all sizes of business described as modest, and all types of books described as modest (substitute even "non-existant").

I doubt you will get anyone to quote you a price based on that level of information. You really need to go and see an accountant, show them exactly what records you keep, and how you keep them (manual, computer, on-line, accounts package, excel, back of envelopes etc) and they will give you a real quote. You will also find, if you visit several, that the prices will not significantly differ.

But your relationship with your accountant should be much deeper than purely price. Any good accountant will save many times their fee in tax savings. They are your buffer between the wild and sometimes fanciful world of business and the stark realities of dealing with HMRC civil servants and the financial nightmares and even possible jail terms that can arise when relationships sour.

If you really don't want to pay anything for your self assessment return (the ultimate cheap), take your books to the local tax office and they will do it for you - on their terms.

[xbp]

Originally Posted by Ray Stewart

But your relationship with your accountant should be much deeper than purely price. Any good accountant will save many times their fee in tax savings. They are your buffer between the wild and sometimes fanciful world of business and the stark realities of dealing with HMRC civil servants and the financial nightmares and even possible jail terms that can arise when relationships sour.

That was my reasoning when I went self employed over twenty years ago. I was maintaining payroll and accounts systems for a living, and was perfectly capable of doing the book keeping (lots of smallish expenses, one sales invoice every 2 to 3 months). I sort of knew that it was a good idea to buy a new car before my financial year end, but I knew nothing about depreciation; neither was I sure how to present my accounts to the tax office.

The accountant did that bit for me, and I was very pleased with the results. (Unfortunately the fellow turned to drink and I ended up dealing with the tax man myself, but that's a story for another day...)

Move on a few years, the recession bit and I moved into computer contracting as a stop gap, which meant working away from home during the week. Here I found it extremely difficult to keep up with my book keeping and should have farmed it out. Had the internet and the idea of virtual PAs been around then, that would have been the answer, for I ended up taking (expensive) time off work to do the books. This was very stressful.

It's horses for courses. You need to adapt your accounting strategy when your business or other commitments mean that your "old way" of working is no longer suitable.

[Caroline]

Originally Posted by Ray Stewart

But your relationship with your accountant should be much deeper than purely price. Any good accountant will save many times their fee in tax savings. They are your buffer between the wild and sometimes fanciful world of business and the stark realities of dealing with HMRC civil servants and the financial nightmares and even possible jail terms that can arise when relationships sour.

If you really don't want to pay anything for your self assessment return (the ultimate cheap), take your books to the local tax office and they will do it for you - on their terms.

I totally agree, i went to see my accountant yesterday about my self assessment, i took along all the information i had (keep my own books , being a qualified bookkeeper).

Not only do we have a good professional re pour, but with have spoken to him on a personally as well.

He also gave me some very valuable information, in which i had to check up on, but he also said to me to go away and break down my accounts or analyse them, which will not only make his job much easier but will also end up costing me less, when he comes to filing them on line for me.

Caroline

[Chris Lodge]

..same as lawyers, dentists and everybody else.

If you asked 100 people in the street if the cost of a loaf of bread was too high, quite probably you would get 100 affirmative replies.

However, unless we are in the business, we have little knowledge of why the cost of a particular item needs to be at a specific level or why professional charging rates tend to be at the level they are.

In real terms, one can only compare one accountant's charging rate with another similar firm in the same area.

I never got along with my father, because he never understood what working with numbers meant to me. My career took me until now to unsuspected roads, but as everything else in life, my career at one of the Big4 firms had come to an end. I’m looking for a new challenge, so I’ve started searching for it and I found this: the BIG4 community . My personal opinion is that if you want a new challenge in life you should try the Big4.com accounting community.

[Ray Stewart]

I don't consider that I have ever overcharged a client and a visit yesterday afternoon by a very nice lady who owns a small local business reinforced that view quite dramatically.

She owns a small shop and she wanted a more local accountant. She brought her books round for me to see and because she runs it through a Ltd company, I quoted her £1,200+VAT for all the accounts, CT600, company house stuff, her own SA return and her weekly payroll.

She then showed me her last set of accounts from a well known firm of accountants in Leicester. Their bill for last year, and the year before.... £3,500+VAT each time and they hadn't even advised her she needs P46's signed by all "casual" staff, or even what the current approved mileage rate is for using her own car!

So in answer to this thread...SOME accountants charge way, way too much and give way too little in the way of service - but people don't seem to realize they are being ripped off until a kindly friend or colleague tips them off.

Or.... is it me that is too soft and I should be charging triple the fee for each of my clients? I would then be able to afford the swimming pool and swanky lifestyle that I know one of the partners in that firm enjoys...(he is our best friend's brother!).

[binarywebs]

Be wary of accountants that charge too little as well. I've heard stories of people charging as little as £60 and saving the customer huge sums of money.

On the face of it this sounds brilliant but I'm thinking any sort of investigation will leave the customer, and not the so called accountant, in a lot of trouble.

[Poppy Design]

Hello

I pay about £1000+vat per annum for my Ltd company accounts, including corp tax, personal tax returns, small payroll and any other hand holding required!

I am very pleased with my new accountant - he works for a well established city company but was recommended to me by a client.- I would say this is a fair price for pay for what I get.

I had a really crap accountant before - completely ignored any emails I sent and bad advice too! only £100 cheaper than current accountant!

I would advise anyone to get a referral if they can.

Joanne

[Paul Norman]

I think, for the most part Accountants dont charge too much.

For the record, I am not an accountant.!! Like all professions, there are good and bad, and it is a feature of the industry that they struggle with customer experience management.

But, you pay for what they know, their expertise on matters tax, legal and financial, which they have to keep up to date with. And, you just need to have someone to do that. They add value to most businesses.

A bit like compare the meerkat! allows you to get quotes for different accountanacy services!

J

[Kay]

I think a lot of people don't really understand what accountants really do. The work is also often confused with book keeping, which IMO is a different thing. Of course, most accountants can do book keeping if necessary.

Accountants can perform lots of different and useful functions:

- historical reporting. You need to get these company accounts into an acceptable format to comply with the law.

- management accounting. A good accountant can provide the information for you to base business decisions on.

- tax advice. Bleugh. I could never easily get my head around that.

People always seem to have this stereotyped idea that accountancy, and therefore accountants are boring. I don't think it's boring, it can be fun. It can also land you jobs in some quite exciting part of the world.

[Ray Stewart]

I had a look at that website although I hadn't heard of it before - not in the professional press, nor from other accountants that I know.

I suppose there will always be a certain type of prospective client who will select his suppliers purely on price. I never have, nor ever will, give a quote totally blind purely based on a limited amount of information which may or may not be true. Nor without meeting with the person.

There is a plague of businesses based in India who were last year hassling accountants to outsource basic work to them for cheap as chips prices - why employ bookkeeping staff in the UK they would say - we will do the whole just for just £50 and you mark it up for whatever price you want. With the lean of the site towards using technology and having your accountant anywhere in the country, I expect most of those Indian businesses are on there.

I would not suggest anyone go down this route to choose an accountant - for if you do - you will assuredly get the accountant you deserve. One who will give you as much professional attention and care that you used to choose him/her.