To what extent does a proper accounting system help reduce my accounting fees?
Ian Harris Director at B+I Lockwood Accountants
This is not 'rocket-science'!Accountants hourly rates range from $100 to say $400 depending on their experience.A proper accounting system means that your accountant can get to the answer with the least amount of time and effort.If a good accounting system reduces his/her time by say 20 hours and they have a charge rate of $150 then you have saved $3000 theoretically.But there is more!A proper accounting system allows your accountant to focus on value-added services.Say tax planning. Or profit analysis. Or other pro-active services!Which is where you may be able to really gain benefit from the fees you pay your accountant.Otherwise you will condemn your accountant to doing the crappy unsatisfying work of cleaning up your records. This is low value work at a high cost.
It really depends what sort of business you have and the amount of transactions you have.
I'm a sole trader.
I'm quite proficient in Excel so I do all the tracking of my finances in Excel. I find it gives me great flexibility.
Because I record everything, there is little work for my accountant to do as I have all the figures for her.
Once I start getting more work, I will start to look at ways of reducing the time it takes to record my finances. I may buy an off the shelf system or utilise an accountant or bookkeeper. Whatever is going to show a cost benefit.
Feel free to contact me if you need some help with working out what would be your best way forward email@example.com