Accountancy rates

Interest-Ed

Hi - We have just become a Limited Company after being a partnership for approximately 15 years. We have a good accountant though we feel he is getting very expensive as he is himself part a firm of Accountants.

Would anyone have an opinion on what to expect to pay for producing the annual accounts and personal accounts.

There is not usually anything difficult or controversial to account for in our business and we usually present him with VAT and expenditure etc. already excelled.

If we did decide to change where do we go to find a new accountant? (Word of mouth or other)

Thanks in antic.

Pennywise

First, the easy part of the question. Wherever possible, go to an accountant that is recommended by trusted friends or family. Most will give a free initial consultation, so go and see 2 or 3, talk to them, get proper quotes from them and go with the one you feel most comfortable with - not necessarily the cheapest.

As to what the charges should be, how long is a piece of string? There is a lot more to do with year end limited company accounts than with any unincorporated business, so you should expect to pay more now that you are limited. Also, there is the potential for your accountant being involved far more throughout the year - the only way to secure the benefits of being limited is attending to ALL the paperwork and formalities, so that means proper "in-year" planning for things like director's wages, dividends, pensions, expenses claims, etc., also the question of whether to have cars owned by the company or personally. You have monthly payroll, quarterly dividends, end of payroll year payroll returns, director's personal tax returns, and company tax returns. Also, are you using/wanting a qualified or unqualified accountant - obviously those who are qualified, undertake ongoing training, have indemnity insurance, and have spent years taking exams, will charge more than the unqualified. Also, location - city centre firms and firms in the south east are likely to be more expensive than in less expensive areas. How good are your books? Are they properly balanced to bank statements, are they fully complete? How many transactions do you undertake, what is your annual turnover, etc. etc. All these factors determine their fees.

Probably the better way is for you to say what they're charging and perhaps give a bit more detail about the business and its records, and then we can say whether it is reasonable or not.

grumpyoldgit_2

I agree 100% with pennywise - saved me a lot of typing

ukbill69

Try doing your own accounts using quick books or sage, I use sage and then you will only need to pay an accountant a few times a year. becuase you do all the work. Veryh easy, but takes a little time doing own accounts, but gets easy as time goes by.

Interest-Ed

I didn't get the chance to look in again yesterday. Thanks for your replies. I think I probably need to do some groundwork to see what others charge.

This will be our first year of trading as Limited so we will have a full year to look at next year.

As a consultancy we have a modest amount of overhead to take into account and we usually check bank accounts and present all expenses and other costs with receipts in an excel format.

As a partnership last year's books cost £1500.00 (ex VAT) on a turnover of approx £95,000.

Costs for setting up the Ltd Co. £850 ex vat.



I was planning to learn SAGE next year - what version do you use?

grumpyoldgit_2

That seems high to me - as a trading partnership (retails shop, trade fairs etc) PLUS my consultancy - with accounts and personal tax returns we paid only about £600 total.
When I had a Ltd Company (IT Training) we engaged dozens of trainers nationwide and only paid £800 for the annual work - sed Quickbooks for accounts including VAT and Payroll - highly recommended.
I still use QB for my consultancy work as it is excellent at tracking accounts expenditure etc.
I would shop around if I were you
GoG

WHA

It does sound on the high side. Have you mentioned the fees to your accountant and asked whether there is anything you can do to reduce their time and therefore their fees - you'd be surprised that sometimes just making a slight change to your method of filing or record keeping could really knock a lot of time of their fees - however any half decent accountant would already have told you this without the need for asking. It sounds as though you are using a "city centre" or "prestige" firm which may well be over the top for your needs - why not try some smaller firms or "one man bands" where their hourly rates should be a lot lower. BUT, having said all that, confidence and happiness with your current accountant does mean a lot - would you be happy if you paid less but didn't get the same service - is it a risk you want to take?

As for Sage, I personally wouldn't recommend it - the only thing going for it is inertia because a lot of colleges, firms, and city centre accountants use it. You may find that smaller accountancy firms don't like it and don't recommend it - they may have their own preference - Quickbooks is a favourite and a lot cheaper for more functionality, not to mention easier to use as it doesn't require "accountancy" understanding. You may find smaller accountancy firms will give you their own "in house" software free of charge which should do the job just as well.

ukbill69

If you go to a certified accountant, then he/she will use sage, if they dont then there not got many customers books and are cheap skates for not buying sage. I knows its a lot of money, but well worth the investment.

grumpyoldgit_2

ukbill69 wrote:

If you go to a certified accountant, then he/she will use sage, if they dont then there not got many customers books and are cheap skates for not buying sage. I knows its a lot of money, but well worth the investment.

WOW too many generalisations to let this one pass :eek:
My company used to train people in Sage and I can tell you it is VERY complex and has a hell of a learning curve before you get even reasonable levels of competence. Why else do Sage have their "approved helpers network" and massive websites full of technical questions?

I have plenty of experience of using accountants from International high profile firms to back street book-keepers - they use what works for them and that is NOT always Sage as you assert - its not a question of being cheap skates its about operational efficiency.

Quickbooks and other packages are generally good because they are intuitive and do what they say on the box without having to have a degree in accountancy to operate them.

I suppose by your assessment the free software that is available is also rubbish? If so why do thousands of people use it without any problems - I suggest you take off your sage coloured specs and have a look at some of the competitors products - you never know you might find a better (cheaper) solution yourself! (see other threads on MSE)

I expect my accountants to be both knowledgeable and efficient that's what I pay them for NOT for having unnecessary trappings.
:cool:
GoG

bridiej

Not all good accountants use sage, I dont think mine does but that doesnt mean they are inferior or cheapskates!!! Some people just dont like it.

rammell

Two comments....

First, I agree with the general comments about Sage. I've been using Sage Instant Accounts for just over 2 years and am now thinking of changing to QuickBooks. Instant Accounts is not particularly difficult to maintain, but I find it not particularly flexible compared to QuickBooks. Using a package like Sage or QuickBooks should enable anyone to reduce their annual accountancy costs.

There is a proviso with my second comment.... this solution will not apply to every business. HOWEVER, you can significantly reduce your acountancy costs and make your life very easy IF this applies to you. Here goes....

I run a consultancy business and decided to set up a limited company by going through an agency (http://www.filetravel.net). They administer the company on your behalf and there are no up-front set-up fees. Initial cost saving.... about £800. You then run all your contracts via the agency. They check all contracts past their legal guys and sign the contract on your behalf..... great 'free' legal protection. They invoice your clients on your behalf and sort out corporation tax and N.I. before passing on your 'salary'. At the end of the year, they'll do your annual return to Companies House and your self-assessment tax return. The cost? They just take an administration fee (about £25) for every invoice/payment that they process. In my case, it amounts to about £300 per year. Much cheaper than using an accountant and absolutely no hassle at all. I just keep track of my own business expenses so that I can notify Filetravel what to include as allowable expenses on my tax return.

Cheers.