Fees

All about fees …

(or the tricks to paying your accountant as little as possible, but don't let on that we told you).

The introduction of GST has created the need to maintain better records and the requirement for more regular reporting. However that doesn't have to mean larger accounting bills.

To assist you in minimising your accounting costs we have compiled the questions most asked by our clients over time. This will also help you understand the process which is undertaken by the team here at Black & Krantz to complete your job.

12 guaranteed ways to master and minimise your accounting costs:

1. How do accountants charge?
2. Can you give me a quote for my accounting job?
3. Why does my bill seem to be more this year than last year?
4. The MYOB/QuickBooks salesman said that the software should reduce my accounting costs but it hasn't.
5. You're my accountant, why is someone else preparing my tax return?
6. Current Charge out rates (exclusive of GST).
7. Does my income tax return get reviewed before I receive it?
8. I asked you to run your eye over this document and you send me a bill.
9. How are your fees compared to other accountant's?
10. Are there cheaper accountants than Black & Krantz?
11. Why has the job taken so long?
12. Paying accounts on time.

Some businesses sell hamburgers, real estate agents get paid commissions and accountants sell time. Therefore if it takes longer to prepare your return then the bill will be more. The more presentably you submit your accounts, the quicker they can be done, and the more cost effective it is for you. We have 8 hours per day available to sell and we cannot stay in business by giving our product away. (Exactly the same advice we would give to you by the way!).

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Just like it's impossible to quote a building job without looking at the plans, or value jewellery over the phone, it's almost impossible to know how long your accounting work might take.
To provide a realistic quote, we require complete access to your financial records, computer system and your tax and ASIC records.

The cost will often depend on how the books are presented to us. Ask if there is a more efficient way of presenting your books to us. You can work with your accountant to try to minimise the time, and therefore the cost. Make sure everything is included – should the accountant pick up and put down your work waiting for missing information the more it will cost and the longer it will take.

We do enter into Fixed Price Agreements which we stick to and honour for one year or one assignment – and then we re-negotiate annually.

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There are three reasons:

a.  There is more work to do this year. Examples: could be an extra lease or your turnover /activity has gone up, or extra things you required us to do like capital gains tax calculation, sale/purchase of business, purchase of a new investment property, GST or BAS advice. b. An increase in our charge out rates as our labour costs rise every year in accordance with CPI increases. (We can also advise you if you think your rates need to be raised).
c. Due to missing information. If information is missing your accountant will leave the job, pick up a new job and will not come back until the current job is complete. The more often a job is put down and picked up the more time is added to the job.

We like having happy clients and it is our wish to complete your job quickly yet thoroughly so we can get onto completing the next job in the queue.

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All Accountants agree that efficient computerisation of your accounts depends solely on the software operator. If the operator is good then it will definitely reduce time.

However if the operator is poorly skilled then it takes longer and we need to use a more qualified (higher cost) accountant to reorder and often re-enter figures in the right way. In this case it is more cost effective to simply supply cheque butts and bank statements. Then we can use a junior staff member to process the information at a lower charge out rate – saving you money.

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Simple – because it's more economical to you. Just like it's not necessary to use a specialist to stitch a minor cut when a G.P. can do it at a much lower cost for you. Be assusred that our accountant team are doing this daily and are very quick and efficient.

All of our team have University Degrees or are in the process of attaining one, and some are CPA's and Chartered Accountants. They undergo over 60 hours per annum of CPE (Continuous Professional Education).

Your appointed accountant handles your day-to-day needs including preparation of Income Tax Returns. They may or may not have the experience to answer investment, strategic, structural or tax planning questions. The partners, Julian and Andrew, and senior accountants look after answers to those questions. You can direct your questions in the first instance to your appointed accountant. If they are unsure of the answer they will find out or either Julian or Andrew will call you back with the answer.

Many of our accountants also act as your Client Managers as the central point of contact with other specialists in our firm. They will generally review and keep up to date with what our company secretarial, software, financial planning and superannuation divisions are doing for you.

You are free to contact any of your specialists at any time, but your Client Manager will know how your affairs fit together and will best understand your overall situation, wants and needs. If you are unsure of an answer given to you by an accountant please do not hesitate to confirm the answer with the Partners.

However if you are unhappy with your new or old Client Manager please, by all means, notify Julian / andrew and we will move you to another person. It's difficult to match people perfectly and we can get it wrong sometimes. So speak out if you are unhappy with anything at all and we will endeavour to correct it.

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Your accountant processes all the accounts and produces a draft set of accounts. He/she then goes to the Associate who completes a 37-point checklist to confirm the integrity of the return. The Partner and the Client Manager discusses the Tax Planning. (It's this tax planning session that could save you thousands in tax.) The partner spends quality time and the accountant spends quantity time. The accountant then finalises the accounts according to the Partner's instructions. Sometimes the client is called in to discuss various problems or to look at options. These processes are designed to minimise the costs to you and maximise the benefits.

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Remember our business is to sell time. If the task takes less than 5 minutes (like a phone call) then it's done for free. More than 5 minutes then it's charged (including phone calls). We only have 8 hours per day to sell. If we give it away for free we would not be in business and be able to offer our services.

For example, whenever we request an answer to a question from our tax solicitors they send us a bill. Once again based on the time spent (at $450/ hour). It's not unusual to get a bill for $112.50 for a 15-minute phone conversation. This is standard practice. We understand that if we want their time we have to pay for it.

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We are about 25% better value than the Big 5 firms and about 10% cheaper or similar to other suburban firms of similar size.

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The only ones that are cheaper are the one-person operators working from home. However what you get is simply a bookkeeping service not a strategic solutions to particular problems. He/she will not have the resources to keep at the cutting edge of tax changes. What you save is a few dollars in Accountant fees could cost you thousands in lost tax benefits and the benefits of an integrated service.

Like most other businesses, to be in business you must make profit, the average net profit of Accountancy firms is around 20%. Therefore if the client receives an account for $1,000, the net profit on the job after wage costs, rent, insurance etc is $200.00.

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a. In the peak return periods it will naturally take longer.

In the PEAK PERIOD between August and March the turnaround time may stretch out to 2-3 months or more, as everyone wants their work done in this period. Every Accountant in Australia is in the same boat. So please be patient in this period.

In the OFF-PEAK PERIOD between April and July turnaround time drops back to a few weeks.

Just like there are peak and off peak periods for holiday accommodation every Accountant is in the same boat. So be prepared for delay in the peak period between August and March. (Remember how hard it is to get accommodation during school holidays.)

b. Waiting for missing information will delay the job substantially – please read question 3.

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Please help us provide you good service by paying your accounts on time. Without payment we cannot provide the resources to give you prompt service. Some clients take a long time to pay but expect us to drop everything and attend to their needs immediately. It must be a two way street.

Payment is due upon completion of work, unless alternative arrangements have been structured.

Firm Policy is that no further work is to be carried out for a client, if there are accounts for which the date for the payment has been passed and no payment has been received by us.

You can pay by:

• Cash
• Cheque
• Bpay
• MasterCard
• VISA
• Monthly Periodical Payment
• EFT – Electronic Funds Transfer

Make a simple decision – Contact us today. We look forward to meeting with you soon