Is my accountant taking the mick..

[john_p]

I know this is one of those questions with no right answer; but we've just been quoted £3k to do our year end accounts and I reckon we're beeing ripped off.

So a small company, turn over <£500k, 5 employees, everything electronic incl payroll, I think our accounts are pretty simple (not much invoicing) ..

Is £3k in the right ballpark? We paid more last year because apparently "everything was a mess" but this year I want to know for sure - they said last year that it would be less as everything was sorted out!

[jonnie5]

Sounds a bit on the expensive side to me. The year end accounts on a small business are relatively simple.

I'm paying about a third of that for a small business (c£750K turnover) and that includes doing our personal tax returns etc as well (3 of us)

I would shop around....

[davidd]

We turned over $350k in our first year, had a lot of issues with sage which had to be resolved and still only paid £900. We are expecting this year (£500k turnover) to be about the same.

D.

[simpo two]

Why should it be related to T/O? Surely fees should relate to the amount of work required. If your company sells big expensive things you could run up a big T/O with relatively small admin.

[Aprisa]

I have a fairly complicated Y/E due to the relatively small average per job in our business, large number of small accounts and the large nominal account numbers, even since going limited I have never paid more than £1500 and that includes both our tax returns done fully.

My Sage system is still a mess and the time needed to sort through problems carried over each year is considerable, so I say - Yes you are being "ripped off"

Nick

[eric mc]

Turnover is a useful guide to the size of a business but that is all it is. The real issues affecting fees are as set out below:

a) is your business a Limited company?
b) is your business a Sole Trader?
c) is your business a Partnership?
d) does your business require specialist knowledge to
complete accounts?
e) does your business have to prepare accounts in
accordance with a governing body or statute?
f) do your accounts have to undergo a formal Audit?
g) how "messy" are the records and in what state are
they presented to the reporting accountant/auditor?
h) does the accountant do any other work for you
during the year and if so, how does he bill you for
this work. i.e on a monthly/quarterly basis or does
he prepare an all-in annual bill?
i) how often do you contact the accountant on an ad
hoc basis for general advice.
j) how much do you value the adcice you are given.
Don't just base your decision on the size of the
fee. There are lots of cheap accountants but they
are not always good accountants.
K) are your accountants members of a recognised
accounting body? Non-qualified accountants tend to
be cheaper but they can be of variable quality.

Just a few pointers.


>> Edited by eric mc on Tuesday 9th December 18:18

[john_p]

eric mc said:

many good points

Ltd co, nothing specialist about us, no formal accounts needed, records are in Sage and in good order (IMO!), a small amount of advice in the year (nothing more than a quick phonecall each time), and this is the only time we pay them anything. They certainly haven't saved us any money in order to justify the fee either!

They proudly proclaim themselves as "Charted accountants and Management consultants" so that might explain it

[Hates_]

Should I admit that my little company had revenues of about <£3k (yes 3k, due to other things happening, so its pretty much dormant) and yet has just paid £700 for our year end accounts

[hughjayteens]

I pay £250 for end of year accounts, and an extra £30 if I want her to do my tax return.

£3k sounds very steep to me.

[eric mc]

To be honest, small "one man band" Ltd Co. accounts should not cost much more than £500 to £600 max. More reasonably sized trading Ltd Co's would be in the £700 upwards bracket.

They are Chartered Accountants so you would expect them to be of a reasonable standard but I must admit that, if what you say is true, their fees seem on the high side. Are they London based - that often is a factor in fee levels too.

[ATG]

What would be a normal hourly rate for a small firm qualified accountant?

[eric mc]

The last "small" firm I worked for (before going out on my own) had the following hourly rates:

Partners - £120
Managers - £90
Seniors £50 to £70
Trainees - £48

And that was almost two years ago.
The firm was based in Morth East Hampshire

[john_p]

eric mc said:

To be honest, small "one man band" Ltd Co. accounts should not cost much more than £500 to £600 max. More reasonably sized trading Ltd Co's would be in the £700 upwards bracket. They are Chartered Accountants so you would expect them to be of a reasonable standard but I must admit that, if what you say is true, their fees seem on the high side. Are they London based - that often is a factor in fee levels too.

Well, Harrow .. so we'll allow them £500 for that

I will have a word and see how low they can go .. thanks all.

[samn01]

I pay around £900 which seems about right.

£3k is a little on the expensive side.

Sam

[john_p]

They reckon 2 days for a senior guy plus his assistant ? That seems realistic to me, although I have no experience in that field.

Bargained down another £500 but I am aware (as are they) that since they are already late[1] we get a fine if they are late for another month ..

[1] my fault!

[eric mc]

If they have missed the ten month filing deadline with Companies House, you pick up an automatic £100 fine. This increases every six months to a maximum of £1.000 after which prosecution may be in order. Don't forget the Corporation Tax payment deadline was nine months after the accounting year end date. The deadline for filing the actual Corporation Tax return form is tweleve months after the accounting year end date.

[furby]

Accountants!! GRRR!!!
I use a guy, the Dad of an old mate of mine, he recently put together my year end, remember the company is 1 year old and earn't enough for my salary, nothing too much you know, just a salary, not enough for a Porsche as yet, and he has just invoiced me for £1500!!!!
Yee gods.
PS if anyone needs any design, Graphics, Web or Architectural then give me a shout.

[simpo two]

Lesson no 1 learned Furby: never let 'professionals' work with the clock running - it's a licence to print money. Whatever you're buying, try to get a quote or at least an estimate, and tell them to let you know if it's going to be more and why. With accountants, the more trivial adding up you can do yourself, basic book-keeping etc, the smaller their bill should be.

[eric mc]

I'm afraid that client's input into book-keeping chores does not always result in lower accounting fees. On may occasions, accountants have to "undo" work done incorrectly by the client - often if the client is using an off the shelf accounting/book-keeping package (I speak from experience here).

Best rule is get an all in quote and ensure the accountant sticks to it. If you have queries, it is usually a false economy NOT to talk to your accountant.

[simpo two]

eric mc said:

I'm afraid that client's input into book-keeping chores does not always result in lower accounting fees. On may occasions, accountants have to "undo" work done incorrectly by the client - often if the client is using an off the shelf accounting/book-keeping package

True. My business is very simple and my accountant (a friend, which helps) showed me how to keep things the way he wanted. That reduces his part to some adding up, number crunching and form-filling.

All I need now is some bigger numbers!