Agreeing terms with an accountant
How to get the accountancy contract you want
It’s important to establish who your contact will be at the firm and in the absence of that person who you can speak to instead. This along with the services they are offering you and the fees they will charge will form part of the engagement letter.
This like the contract, signed by both of you, which will be the basis of your working relationship. As such, it is important to get as much information on it as possible. If the accountant is to handle your tax, your accounts and your payroll, it should say so.
And this is the point where you talk about money. Traditionally accountants charge by the hour with more for a partner than for a junior member of staff. Many firms are prepared to be flexible with regards to payment.
You might negotiate a fixed one off fee for a full audit, for example, or pay monthly rather than all at once at the end of the year. The latter should be popular with both parties as it ensures regular payment when the money is available.
Although Paul Watts, corporate finance partner at HLB Kidsons, advises: “Don’t always go for the cheapest firm, look for one that adds value. How much does the hourly fee vary for a partner and other staff and will photocopying and phone time be included in the cost or be extra?”
Most importantly, don’t be afraid to question anything on the letter or to ask for something to be added. As with most ‘contracts’ it is in both your interests.
Your accountant should be a good investment. In exchange for an hourly fee you should get someone who saves you money, prevents you sitting up late with accounts that won’t balance and who can provide general business sense. All the more reason to choose carefully.
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