What is a good fee for an accountant?

[Chief]

Of course these things vary, but what is a reasonable fee for an accountant doing a company, family trust and two personal tax returns including monthly BAS?

3% of total income? 5%?

 

[Mean Muggin]

Of course these things vary, but what is a reasonable fee for an accountant doing a company, family trust and two personal tax returns including monthly BAS?

3% of total income? 5%?

Depends on how big the company is, and the level of financial reporting that is required.

Not sure what % either way however. One of the Freo Mods is doing his CPA/CA. He might be able to help you out?

 

[Mean Muggin]

Sabre_ac is the Mod.

Can I have my Veteren Status now please Chief?

 

[Mundy]

Of course these things vary, but what is a reasonable fee for an accountant doing a company, family trust and two personal tax returns including monthly BAS?

3% of total income? 5%?

As mentioned before, how big is the company, how complex is the FT and are you using a CA or CPA.

What was the fee for last year, unless you have adding something drastic that'd be a fairly good guide.

 

[HigginsHawk]

The only way you can accurately compare is by asking the hourly rate. This can vary within a large firm because you could have a grad and a senior working on it and they will have different charge out rates. For example, I'm a partner of my own CA firm and I charge $200/h for tax, $250 for companies, $300 for super funds and $350 an hour for audit.

With a good firm you should be able identify very clearly what you are getting for your money with an engagement letter.

My first question to you would be what sort of record keeping tool do you use for recording transactions? Quickbooks, MYOB? If you can look after this side of things reasonably well then you have made the accountants job a lot easier.

As far as he BAS goes it should take no more 1 minute to lodge a BAS if you register with the ATO for a digital certificate. All the info you need should be contained in your record keeping tools.

Your accountant should be there to show you how to make money not rip you off by taking on work that you can do quite easily yourself.

 

[Mundy]

The only way you can accurately compare is by asking the hourly rate. This can vary within a large firm because you could have a grad and a senior working on it and they will have different charge out rates. For example, I'm a partner of my own CA firm and I charge $200/h for tax, $250 for companies, $300 for super funds and $350 an hour for audit.

With a good firm you should be able identify very clearly what you are getting for your money with an engagement letter.

My first question to you would be what sort of record keeping tool do you use for recording transactions? Quickbooks, MYOB? If you can look after this side of things reasonably well then you have made the accountants job a lot easier.

As far as he BAS goes it should take no more 1 minute to lodge a BAS if you register with the ATO for a digital certificate. All the info you need should be contained in your record keeping tools.

Your accountant should be there to show you how to make money not rip you off by taking on work that you can do quite easily yourself.

Pretty cheap.

Partners at my old firm were charging in excess of $300 - Across the board.

 

[Eagle87]

The only way you can accurately compare is by asking the hourly rate. This can vary within a large firm because you could have a grad and a senior working on it and they will have different charge out rates. For example, I'm a partner of my own CA firm and I charge $200/h for tax, $250 for companies, $300 for super funds and $350 an hour for audit.

With a good firm you should be able identify very clearly what you are getting for your money with an engagement letter.

My first question to you would be what sort of record keeping tool do you use for recording transactions? Quickbooks, MYOB? If you can look after this side of things reasonably well then you have made the accountants job a lot easier.

As far as he BAS goes it should take no more 1 minute to lodge a BAS if you register with the ATO for a digital certificate. All the info you need should be contained in your record keeping tools.

Your accountant should be there to show you how to make money not rip you off by taking on work that you can do quite easily yourself.

With respect, why the hell would you do that?

Your time has a value, why the hell would you vary that value based on different types of work?

I note you are charging $350 for audit and $200 for tax. I presume this must be for tax compliance work as otherwise those rates are completely arse about.

Based on those rates, why would you ever do tax compliance? I mean it becomes a silly use of your time.

$200 an hour is also a pretty low charge rate for a Partner in any area of Accounting.

You actually quote those rates to your clients? i.e. "I have 4 separate charge rates depending on what you get me to do"....

 

[Eagle87]

Pretty cheap.

Partners at my old firm were charging in excess of $300 - Across the board.

Which is still cheap Mundy.

Big 4 or Second Tier Tax partners (for example) would rarely (if ever) be under $500 an hour.

Big 4 especially have some tremendous rates. Mate is a Director (below Partner) in Corp Tax in Perth with a rack rate of $695 per hour.

 

[Mean Muggin]

Which is still cheap Mundy.

Big 4 or Second Tier Tax partners (for example) would rarely (if ever) be under $500 an hour.

Big 4 especially have some tremendous rates. Mate is a Director (below Partner) in Corp Tax in Perth with a rack rate of $695 per hour.

That's the reason why I study my arse off. After my initiation I won't be getting out of bed for anything less than 6 figures a year. Beats being a lawyer.

 

[Bobby Beecroft]

With respect, why the hell would you do that?

Your time has a value, why the hell would you vary that value based on different types of work?

I note you are charging $350 for audit and $200 for tax. I presume this must be for tax compliance work as otherwise those rates are completely arse about.

Based on those rates, why would you ever do tax compliance? I mean it becomes a silly use of your time.

$200 an hour is also a pretty low charge rate for a Partner in any area of Accounting.

You actually quote those rates to your clients? i.e. "I have 4 separate charge rates depending on what you get me to do"....

I thought exactly the same thing, when I first saw the post.
Where I work partners are around the $350.00 per hour mark, whatever work is being completed.

In response to the initial post, it's pretty much as already stated. If you can maintain your bookkeeping on a MYOB, Qbooks file at a good level this should reduce the charge. BAS's are something you can do easily via the ATO portal, but if they are littered with errors, this will increase the year end charge if additional time is spent on a GST reconciliation. ie. finding the errors & then rectifying them in the financials & on BAS's.

From what you have I would be looking at a mid-tier type firm, tops. Without knowing the complexities of the work, I would not see a need for a top 4 type accounting firm. This is looking purely from a compliance angle.

A 'good fee' is very much debateable & is the $64 question. Is the accountant assisting with future goals & presenting opportunties that may be of benefit? Compliance work accountants are a dime a dozen, it can be other areas that separate the good from the also rans.

A good suburban CA/CPA should be able to complete the work you are after, which would reduce total $$$ given the comparative charge out rates. You just need to find one that you are comfortable with.

 

[Frodo]

for $7000 i have 3 companies accounts handled including 3 personal tax returns for family

My SMSF costs $720 per year plus levy.

My accountant works from home (low overhead) and gives advice year round without extra cost.

I do pay $500 for the FBT return too.

BAS is a breeze. I have a spreadsheet that I just plug the numbers into, and out comes every entry and all the journals. 20 mins a month, 30 mins on the quarterly ones as I calculate profit and don't use the %

 

[Eagle87]

for $7000 i have 3 companies accounts handled including 3 personal tax returns for family

My SMSF costs $720 per year plus levy.

My accountant works from home (low overhead) and gives advice year round without extra cost.

I do pay $500 for the FBT return too.

BAS is a breeze. I have a spreadsheet that I just plug the numbers into, and out comes every entry and all the journals. 20 mins a month, 30 mins on the quarterly ones as I calculate profit and don't use the %

The top line is meaningless without some explanation of the size/complexity of their affairs.

If you get an SMSF done for $720 (does that include audit fee), its either an extraordinarily small and simple fund or your accountant is charging silly low rates.

And regardless of what people think, at some level, you do get what you pay for.

 

[Chief]

A good suburban CA/CPA should be able to complete the work you are after, which would reduce total $$$ given the comparative charge out rates. You just need to find one that you are comfortable with.

I realised I didn't even know my accountant's hourly rate.

We talked about how to reduce the bill and he said half of it is BAS - a task for which he said they charged about $80 a month. How you $2,000 out of $80 per month is beyond me but "well we send you reminders and send you an email with the amount to pay... taht all adds up" Unless he is charging me $40 for his secretary to send me an email saying "Please remember your BAS is due on the 20th" and "Please pay $x" then I don't see how the figure gets that high.

I sent in a request to break down the $4200 invoice by task and hourly rate but no reply yet.

 

[Frodo]

The top line is meaningless without some explanation of the size/complexity of their affairs.

If you get an SMSF done for $720 (does that include audit fee), its either an extraordinarily small and simple fund or your accountant is charging silly low rates.

And regardless of what people think, at some level, you do get what you pay for.

Apart from the last line, true. And i assure you that there are two professions where price and quality are not in any way reflective. That is accountancy and law.

Businesses turnover around $12M last financial year. Accounts not complex because I provide fully prepared and reconciled accounts to my accountant. In fact he rips me off. He just plugs the figures into his programme and the ATO portal, and gets me to sign off that the figures are based upon what I've given him.

SMSF is cash, and cash only. So interest is the only income other than contributions. All i have to provide is bank statements. Couldn't be simpler.

 

[isthisavailable]

Wow, how hard do these accountanty type dudes have to work for that kind of coin? Is it 7am-7pm plus Saturday morning grinds, or are these guys taking hour-long lunch breaks and getting paid the big $$$ to do so?

 

[ben_cats_fan]

I realised I didn't even know my accountant's hourly rate.

We talked about how to reduce the bill and he said half of it is BAS - a task for which he said they charged about $80 a month. How you $2,000 out of $80 per month is beyond me but "well we send you reminders and send you an email with the amount to pay... taht all adds up" Unless he is charging me $40 for his secretary to send me an email saying "Please remember your BAS is due on the 20th" and "Please pay $x" then I don't see how the figure gets that high.

I sent in a request to break down the $4200 invoice by task and hourly rate but no reply yet.

How'd you go with this by the way Chief?

It all depends on the complexity of your work which is what everyone else has said.

 

[NitroFan]

...you could've at least chosen a name that didn't give it away.

 

[yeah_nah]

I realised I didn't even know my accountant's hourly rate.

We talked about how to reduce the bill and he said half of it is BAS - a task for which he said they charged about $80 a month. How you $2,000 out of $80 per month is beyond me but "well we send you reminders and send you an email with the amount to pay... taht all adds up" Unless he is charging me $40 for his secretary to send me an email saying "Please remember your BAS is due on the 20th" and "Please pay $x" then I don't see how the figure gets that high.

I sent in a request to break down the $4200 invoice by task and hourly rate but no reply yet.

Getting your accountant to do your BAS work is probably the biggest ripoff out, maybe even worse han having them do your Kids individual tax returns where their salary is like $5,000 from McDonalds

A very simple BAS (ie just the instalment amount) would take a max of 15 minutes. At my work the minimum for a BAS is about $160.

I would churn out 20 of these kind in half a day when it comes BAS time. Certainly not bad for my employers considering in a day they pay me less than what they make from me doing 1 of these

 

[Jabso]

I've heard at chartered firms they give BAS statements to junior staff it is that easy (not graduates but work experience kids). It is just simple book keeping hardly requires any analysis at all.

 

[yeah_nah]

I've heard at chartered firms they give BAS statements to junior staff it is that easy (not graduates but work experience kids). It is just simple book keeping hardly requires any analysis at all.

Work experience is really just cheap cheap labour, Im sure a lot of the work experience kids are just as good as the guys who have a uni degree.

My firm took me straight from highschool and I am now in my 2nd year of my uni degree and in my 2nd year at the firm.
I am doing the same amount of work and same difficulty of work as another employee who has been at the firm for 1 year but was taken as a graduate accountant.
The difference is he gets paid probably 20k more than I do..

And yeah, you are right, I was doing BAS work in my first week there.

 

[frantelle]

When I was 18 my boss caught wind of the fact that I was doing an accounting degree. He then informed me that I was in charge of the BAS quarterlies. You just have to learn to do it once and its very very simple

 

[Smyth94]

Which is still cheap Mundy.

Big 4 or Second Tier Tax partners (for example) would rarely (if ever) be under $500 an hour.

Big 4 especially have some tremendous rates. Mate is a Director (below Partner) in Corp Tax in Perth with a rack rate of $695 per hour.

Ever heard of a write off?

 

[Power Raid]

Of course these things vary, but what is a reasonable fee for an accountant doing a company, family trust and two personal tax returns including monthly BAS?

3% of total income? 5%?

Chief, it is against CA's and CPA's charter to bill in this manner. They are obliged to charge based on the time, level of complexity and nature of work.

At the big firms (EY, DT, PWC, KPMG) rates range from $200 to $2,000 per hour.

A normal everyday accountant required for most people earns $100k - $200k per annum. Based on that, $60- $80 per hour will give you a decent accountant for most needs.

 

[Power Raid]

Wow, how hard do these accountanty type dudes have to work for that kind of coin? Is it 7am-7pm plus Saturday morning grinds, or are these guys taking hour-long lunch breaks and getting paid the big $$$ to do so?

When I was at Andersen and EY work was circa 60 hours a week and compounded by the CA course which is horrendously challenging (boring, hard and long).

You have to remember, the hourly charge out rates are not what the accountant takes home. Say when I was being charged out at $500 an hour I would only see $60 (based on a 40 hour week).

The central offices space don't come cheap. Nevertheless, most equity partners would be on $1-2m per annum.

$1-2m sounds like a lot, but the equity partners have done extraordinary efforts and sacrifice to get to the top. Not to mention, they can get sued and loose everything (ie Bond Corp, Enron, HIH, Onetel etc etc).

 

[Eagle87]

Chief, it is against CA's and CPA's charter to bill in this manner. They are obliged to charge based on the time, level of complexity and nature of work.

Absolutely and utterly untrue and has been for a number of years. Value billing (or pricing) has been an available option to these firms for some time and they do use it, although not as much as they should. The 2010 Victorian CPA Public Accountants Convention actually brought in a specialist in the area of Value Billing (John Chisolm former Managing Partner at PKF) to train their members in how to do it.

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