Why are some accountancy firms so cheap? Well, the answer is to look at how accountants charge for their time.
1. The level of staff working on the job. If a firm uses experienced, qualified staff then they’ll have to pay those staff more and ultimately charge more in fees to its clients. If a firm just employs very junior staff and unqualified staff you can cut costs – but at the risk of cutting quality and client service.
2. The amount of time an accountant expects to spend on dealing with your affairs. If the price is low then the accountant won’t be expecting to spend much time on your job.
3. Whether the accountant is the member of a professional body. These firms have additional overheads to cover important things such as staff training and professional indemnity insurance if they give the wrong advice. Firms who don’t belong to a professional body don’t need to bother with these costs. We think that maintaining professional standards and investing in training is really important.
4. Whether the work is being outsourced overseas (often India or the Philippines) to cut costs. We don’t do this.
5. The quality of software you’re provided with. We use Xero to save our clients as much of their time as possible – but this does cost more to provide. Cheap accountants will often just provide a spreadsheet for you to complete which keeps the fee down.
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