Audit Fees - what's appropriate.

C

CIO

Guest
We pay 14k plus expenses (of about 900) for our audit - we handle the CT and compliance stuff.

Our company is in the tech business.

Turnover 4-5m
Staff 20
Profits 50k-300k.

And we've had the same accounts team for the last 5 years so it's up to date.

Are we being over charged on our audits or is it the market rate?
 
Maybe we could list our audit fees here for comparison purposes?
 
With tech business I am guessing EI involvement = compulsory audit
I am in the same business and the fees seem similar. Whether or not it is good value depends on the size of the firm and the quality of service given.

Have you queried the bill in the past?
 
My travel agency had t.o. of 8m a few yrs ago, started winding down to 2m when I closed a few months ago. Profit range similar to OP, Staff from 20 in 2005 down to 3 end of last year.

The most I paid when t.o. was 8mill was 7k -down to 4k a year ago - am doing final audit now and have agreed 3k fees.

Always thought i paid too much till reading the previous posts !

It really depends on what the auditor does -and that depends on how well presented are your accounts to the auditors. A good computerised accounts system (backed by proper human control throughout the year ) should make life very easy for auditors.

Looking at OP's fees it seems the auditors must be spending a lot of time and human resources putting OP's accounts in order.
Or they're ripping OP off.
 
oldnick said:
My travel agency had t.o. of 8m a few yrs ago, started winding down to 2m when I closed a few months ago. Profit range similar to OP, Staff from 20 in 2005 down to 3 end of last year.

The most I paid when t.o. was 8mill was 7k -down to 4k a year ago - am doing final audit now and have agreed 3k fees.

Always thought i paid too much till reading the previous posts !

It really depends on what the auditor does -and that depends on how well presented are your accounts to the auditors. A good computerised accounts system (backed by proper human control throughout the year ) should make life very easy for auditors.

Looking at OP's fees it seems the auditors must be spending a lot of time and human resources putting OP's accounts in order.
Or they're ripping OP off.
Click to expand...
How well they're presented is subjective but no issues come to light perhaps due to the experience and qualifications of the financial controller.
 
If the only service supplied is an opinion on the accounts then the fee appears generous but it may be a quite reasonable fee if the auditor is doing more than simply offering an opinion on the accounts.

I am an auditor and also assess the audit work of others and my experience is that in SME's the role of auditors gets confused with the role of accountant (by the auditor as well as the client). The worst effect of this is that the auditor spends time doing things he's not asked to and/or don't give any value (or if it is of value the auditor doesn't let the client know).

The answer is to engage with your current auditor and if you're still unsure seek a quote from another firm - it is quite a competitive business. That being said I rarely come across a "rip off" fee when we take over a client - aside from the larger firms, most auditors underbill.
 
CIO said:
We pay 14k plus expenses (of about 900) for our audit - we handle the CT and compliance stuff.

Our company is in the tech business.

Turnover 4-5m
Staff 20
Profits 50k-300k.

And we've had the same accounts team for the last 5 years so it's up to date.

Are we being over charged on our audits or is it the market rate?
Click to expand...

Hi CIO,

Click on my username for a link to our website and if we are in your half of the country give us a ring. Ask for my boss Ger. I would be surprised if he didnt quote you lower.

I think the key is to ask yourself is the auditor adding any value or just simply signing off the report.

If you want to ask me anything feel free to PM me. I don't want to clog up the thread otherwise.

Thanks,

Brian
 
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