Accounting is an industry that has a tool for everything. Whether you’re just keeping books or calculating the precise tax that you need to pay on a billion-pound engineering purchase, there’s an accounting tool for it.
With so many tools needed, there’s been a lot of discussion recently about how you keep costs appropriate, both for yourself and your clients, to the effort you put into an account.
One of the most commonly cited causes of costs which weren’t at the right level was clients who weren’t paying the extra costs of support. Accountants can often end up as a source of support for various packages their clients use, and whilst an accountant might think nothing of a ten-minute call once a week, that’s hours of extra work over a year. If you have 100 clients, that adds up quickly. So, it’s important to make sure you’re charging appropriately to include extra support costs!
The other topic of discussion is the issue of “scope creep”. An accountant may initially only do certain things for a client, but over time it’s likely that they will take on extra responsibilities as the client starts to trust them more. This can cause an accountant to have to acquire new tools to help with their new tasks and spend more time on the accounts. However, many accountants don’t pass the extra costs of this onto their clients appropriately. It’s important to keep track of how much a client is costing you, whether in terms of extra time worked or extra costs incurred and increase your fees appropriately.
However, one big trap to avoid when looking at your costs is the urge to “nickel and dime” clients by charging for every little thing you can think of. Some accountants will look at these potential extra costs and start charging for the time spent on any extra work, right down to the minute. At AIMS, we hate this attitude – there’s a reason we make such a big deal out of AIMS Accountants not charging by the hour!
We believe that this just hurts clients – they don’t feel they can trust you to do work without charging through the nose for it, and hourly charges means a client doesn’t have any idea what their bill is going to be ahead of time, so they have no way of making sure they’re prepared. This hurts the trust between client and accountant, which can ultimately lead to a breakdown in the business relationship.
Whilst you have to make sure that you’re charging your client what your time is worth to keep up with your costs, and raise your fees if needs be, it’s important to make sure that your client knows what they’re paying and isn’t going to be hit with a surprise bill!
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