Accountant charging excessive costs, also wants direct debit payments.

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phil1147

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we are a newly formed ltd. company who approached an accountant. he is going to be hands on dealing with book-keeping, VAT, PAYE, end of year returns and a few other things. the problem is that he is charging 350 per month and wants this paid directly into his acount every month by direct debit.

firslty is this an excessive cost for the works described?
secondly is the direct debit idea standard practice?
 
in relation to payment by DD, this make sense for spreading the cost over the year and "paying as you go".

if this includes the year end work, then consider excluding this element of work from the monthly DD and paying this at the year end when done

whether the cost is fair or not depends on how much work will be required which is hard to tell from your post. He is selling time and the more time it takes to assist you the more it will cost.

If concerned about cost, consider what element you can do yourself to save money

good luck with your new company

regards
 
This is one of those "how long is a piece of string" questions because we don't know now much time each week/month your accountant will be spending doing work for you.

Designing and implementing your accounting system is obviously a professional service that will require some expertise. Then the year-end procedures including signing off your accounts is another professional service.

Then they're doing monthly work too. So all in all, €4200 for an entire year's work and getting everything right isn't exactly an exorbitant fee.

If you gave someone €100 to come in and post invoices or do payroll once a week for a year it would cost you more and they wouldn't do your tax calculations or signing off your accounts.

If you have the expertise to do all this yourself by all means don't use the accountant.

One option is to let the accountant do all the work for the first year and then take over the monthly tasks yourself.

Generally you'd be invoiced and pay the bill in your own time but companies are so slow to pay and accounting practices have resorted to invoice discounting and giving clients discounts to pay on time so I'm not surprised at them wanting to be paid by DD.
 
From experience I wouldn't have called €350 for that work anything but cheap. I just checked, my accounting costs last year including year end and audit fees were just over €11k.
In terms of DD, thats become quite normal from what I can see and it also makes sense to pay it as you go so that its including in your monthly costs not one large invoice that arrives when your not ready for it!
Unless your used to dealing with VAT and PAYE then I have to agree with tenchi-fan - get the accountant to at least do year 1 and set it up on a software package you can take over using inhouse.
 
thanks guys, ill use him for the 1st year then review the situation, thanks for the comments
 
The cost will be higher when the accountant is doing everything for you as they have more to do. If you could do a few bits yourself then it would probably reduce the cost of the accountant but it will cut into your own time as a result.

You can get free software for accounts and payroll that will help you to take on some tasks yourself instead of relying on the accountant to do them. If you have never done accounts of payroll before though you may need to gain some skill in the area first as otherwise if you did things wrong the accountant would have to spend time checking through what you have done and correcting any errors or omissions.
 
mrblues said:
From experience I wouldn't have called €350 for that work anything but cheap. I just checked, my accounting costs last year including year end and audit fees were just over €11k.
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You can't really compare your costs against the OP since your cost includes an Audit and his doesn't.
 
thats exorbirant in these conditions.

i used tenderme.ie to replace my accountant this year and ended up using the same accountant for 1.5 k in total last year he was 3.5k fees are down and he responded to the tender. there were cheaper but the devil u know and all that...
 
ecstatic,
did the size of the job decrease or did the accountant just reduce the fee by 2k because you said you were leaving?
The accountant in this case will be doing bi-monthly VAT returns, RTD, weekly/monthly payroll, P30s, P35, End of year accounts, Corporation Tax return, one or perhaps two Income Tax returns, Companies Office Return and abridged accounts, Central Statistic Office return, Return of 3rd Party Information and providing general advice. Are you comparing like with like if so you are doing very well at 1.5k and I think that 3.5k is good for all that work.
It depends on the volume of work if there is only 12 sales invoices and 30 purchase invoices for the year then that is a different story.
 
phil1147 said:
we are a newly formed ltd. company who approached an accountant. he is going to be hands on dealing with book-keeping, VAT, PAYE, end of year returns and a few other things. the problem is that he is charging 350 per month and wants this paid directly into his acount every month by direct debit.

firslty is this an excessive cost for the works described?
secondly is the direct debit idea standard practice?
Click to expand...

The common law of business balance prohibits paying a little and getting a lot. It can't be done. If you deal with the lowest bidder, it's well to add something for the risk you run. And if you do that, you will have enough money to pay for something better.

It's unwise to pay too much, but it's also unwise to pay too little. When you pay too much you lose a little money, that is all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing you bought it to do.
 
With respect software is not always the answer especially free software. All that software does is compound the mess. As with all software if rubbish goes in rubbish comes out. If a person wishes to do their own bookkeeping and tax returns then adequate training must be done. As someone who has cleaned up some of these situations the only one to gain from skinting on this expenditure are accountants who clean the mess up and revenue with interest and penalties.
 
I agree with Joe. The problem for accountants who deal with micro businesses is that the client doesn't want to pay for book-keeping, fair enough, and ideally accountants don't want to do book-keeping because for an accountant to hire a book keeper costs more than what a client is prepared to pay for the service. So then we get a situation where the client decides to do the the book keeping themselves. However, 90% of the time, the client makes an absolute balls of the book keeping and it takes the accountant just as long to clean it up.
 
my details

Joe 90

This is what he does for me:

www.tenderme.ie/browse/categories/c...ew/?guid=473bff08-ea90-4ef7-aaa8-09143f9a74bf

What i prepare for him is the following:

Use Credit Card or cheque for every transaction.

Scan all into a computer (good for backups anyways).

I then email him everything and he does the rest.

He was excessive charging and constantly tries to overcharge like a lot off accountants i expect you just gotta keep em on a tight rein.
 
I told him i was going too look at tendering out the bid and a month before i did tender it i told him the website it was going to be on.

I dont know if he knew it was me who posted or not but tenderme i have too say i use a bit for services fixing things etc.

If you want his details i can pass on but i recommend tenderme.

One of the bids i had was cheaper than his and the most professional written bid overall and i didnt take it as i have been using him for 4 years or so.

My workload probably has gone up etc. (fyi: Im an IT contractor)
 
ecstatic said:
i used tenderme.ie to replace my accountant this year and ended up using the same accountant for 1.5 k in total last year he was 3.5k fees are down and he responded to the tender. there were cheaper but the devil u know and all that...
Click to expand...

ecstatic said:
This is what he does for me:

www.tenderme.ie/browse/categories/c...ew/?guid=473bff08-ea90-4ef7-aaa8-09143f9a74bf

What i prepare for him is the following:

Use Credit Card or cheque for every transaction.

Scan all into a computer (good for backups anyways).

I then email him everything and he does the rest.

He was excessive charging and constantly tries to overcharge like a lot off accountants i expect you just gotta keep em on a tight rein.
Click to expand...

The price you now have at €1,500 for the work described is more along what I would expect. You said there was a cheaper bid, however I doubt that there would be many firms who would do all of you described, to proper professional standards, for much less. I think you got a good deal. That being said, keep it under review and ask for estimate of the next year's work before the books go in to him.
 
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