How Do You Keep Your Accounting Fees and Associated Costs Down?
Assuring complete information is provided in the first instance is a great first step.
High accounting fees often result from your accountant not being given complete information. Having to chase the client or 3rd parties for missing data is very time consuming. If you can provide your accountant with all the information they need at the beginning of their work, then:
- Your work is completed much faster
- The majority of your work can be completed in one sitting and there is no time spent re-familiarizing.
- The overall time is reduced, resulting in lower fees.
We suggest supplying on line access to your bank accounts, payroll processing firm, and other relevant tax data, in read-only format. This saves a large amount of time on the job, and is much greener as well!
Understand the value of your time versus your accountant’s time.
There are tasks that clients can take upon themselves to mitigate time spent on the job. Tasks such as hunting down K-1s that are not present for tax preparation, obtaining school information regarding dependent care credits, obtaining your mortgage information, maintaining your cost basis on your bonds and marketable securities through the years and being ready to provide them upon sale, are good examples where you can do some legwork and save time on fees. Another example is sending previously issued tax returns to your banker or mortgage broker.
On the other hand, if you are extremely busy, your time may be better spent providing your service, and delegating to the accountants office.
Utilizing “Best Practices” within your accounting department and others.
When was the last time you did a process evaluation or had one done? To streamline a department, we ask questions such as:
- Is the step or process necessary?
- Does it add value?
- Can it be eliminated?
- Is it labor intensive?
- Can it be automated?
- How accurate is the data?
- How many people participate in the process?
- Does it take excessive time to complete?
- Are too many handoffs occurring?
- Is there a duplication of effort?
If your answers to any or multiple questions are problematic, it would probably be cost effective to engage us to do an evaluation with recommendations. Call us to discuss.
"Best Practices" within your accounting department can save an enormous amount of frustration, time, and money. Take advantage of unused system functionality, possibly eliminating duplications of tasks, or unnecessary manual tasks. Conduct process training, develop system “super users” and establish process metrics to measure your department’s success. Recognize successes!
Outsource your accounting functions.
Outsourcing your accounting is often a very effective tool in limiting your finance department costs. In fact, at a time when lower expenses are almost a matter of survival, it creates a win-win relationship for both the CPA Firm and the client as well! If you are in a position where you do not need, nor can afford, an internal heavy hitter for 150k (and at times much higher than that), outsourcing is the way to go. Especially, if it is a position that can be completed at times, for less than 40 hours a week. Why not pay, just for the services that you need? This turns a higher fixed cost including salary, bonus, training time, payroll taxes, health insurance, vacation and sick days, into a variable cost that you pay for only when you need it. The expertise of the service provided by a CPA Firm will be more streamlined and eliminate the potential for employee theft.
With better information and a stronger finance function, you can more effectively manage your business because you as the business owner will receive more accurate and timely information. By working to outsource your accounting, you can gain all of this while reducing costs. An outsourced accounting firm can be a strong part of your company's team.
Everyone Knows Price, But What Is The Cost???
One should always think cost/benefit when deciding on spending professional fee dollars. More often than not, the benefit will far outweigh a reasonable cost. Do not be afraid to ask, “What possible benefits can I obtain by asking for this additional service?” Remember, sometimes the cost of inaction, is exponentially greater than resolving an issue.