Navigating the Accountancy Conundrum: Whose Side Are You On?
Hello, dear readers! I find myself in quite a perplexing situation with my accountant and would love to gather some insights or similar experiences from you. I’m trying to figure out whether I’m the one losing my marbles in this scenario.
Back in January 2022, I took the plunge and purchased a small business. I filed the 2022 taxes using an online service but opted for an extension on the 2023 filings. I wanted to carve out some time to find a more seasoned accountant who could not only handle this year’s taxes but also review my previous year’s filings for any necessary corrections, tidy up the bookkeeping, and provide ongoing advice.
After some research, I decided to hire the accountant that the previous owner had been using. They were local, had good reviews, and already had familiarity with the business, making them a natural choice. I officially engaged with them in March and met with the team in late April to discuss our needs.
Following our meeting, I was contacted by one of the junior project managers, whom I’ll refer to as Stacy. She provided me with a comprehensive list of documents and reports that were necessary for our collaboration. My bookkeeper and I gathered everything requested and submitted it to Stacy by mid-May. Shortly thereafter, I received a project budget, which was slightly below $5K. This budget outlined tasks for year-end reviews, filings, and meetings—a scope that seemed manageable.
Once I submitted the requested documents and approved the budget, I double-checked with Stacy to ensure everything was on track. She assured me there was nothing more needed, leaving me to believe that the team was diligently working on our filings. However, after a month of silence, I reached out for an update in late June. To my surprise, Stacy mentioned she needed to create a new budget, despite the one I had already approved in May. After reviewing this new budget, I gave my approval again, but she then informed me that she was occupied with another project, delaying our work until after July 15th.
As the middle of July approached, I followed up, only to find out that progress had yet again been stalled. Stacy claimed they couldn’t proceed without access to our QuickBooks, as we were using the desktop version rather than the online edition. Not long after, the senior accountant who initially engaged with us reached out, indicating that he and his IT team were working on a solution to access our software. I collaborated with the IT guy, and we decided on a remote access method. I then instructed my bookkeeper to facilitate this process.
Fast forward two weeks to the beginning of August—still no action from their end regarding our access. When I called Stacy again, she mentioned she was too busy that week to address our situation, advising me to check back next week.
Just when I thought things couldn’t get any more surreal, I received an invoice for $1,300. This bill, once totaling $1,700, included a detailed breakdown of work performed, which turned out to be quite astonishing. Charges for every interaction, from our initial meeting where the senior accountant introduced himself to the office, to every single email and phone call exchanged, were itemized and billed hourly. Tasks such as organizing the reports I had provided were billed as well, with line items even capturing “helping Stacy” at an hourly rate.
Needless to say, I was taken aback. While I’m not a veteran in dealing with accountants, my past experiences typically involved flat fees for tax filings and consultations, so this model was entirely foreign to me. I genuinely feel frustrated, as we seem no closer to completing the filings than we were since I first reached out back in April.
So, community, I turn to you: Am I being unreasonable here, or has my accountant gone off the rails? I’m absolutely open to compensating for genuine work done, but I never anticipated being charged for every minuscule interaction while seeing no actual filing progress reflected on the invoice. It feels excessive, to say the least.
Thanks for reading, and I’m keen to hear your thoughts—who might need to take a step back and reassess this situation?
2 Comments
It sounds like you’re navigating a frustrating situation, and it’s completely understandable to feel overwhelmed by the various communications, billing practices, and delays involved. Let’s break this down a bit to offer some clarity and actionable advice.
Understanding the Billing Practices
Hourly vs. Flat Fee Structures:
The most common arrangement in accounting is either a flat fee for specific services (like tax preparation) or hourly billing for ongoing consulting. In your case, it seems you were initially presented with a flat fee for the budget project, but the firm has failed to communicate that they were transitioning to an hourly billing model. This lack of clarity can often be a source of frustration for clients.
What to Expect from Accountants:
It’s generally good practice for accounting firms to provide a detailed service agreement that outlines exactly what services are included in a flat fee and what might incur hourly charges. If the firm did not provide this upfront or if it was vague, that’s a red flag. You’re right to expect that since you engaged them for tax filings, much of what they charge should relate directly to that work rather than every corresponded interaction.
Evaluating the Communication
Proactive Engagement vs. Delays:
It seems that there has been a significant lack of proactive communication from their side, especially regarding accessing your QuickBooks and moving forward with your filings. If the firm indicated that they could not work on your file due to software limitations, they should have communicated this earlier in the process rather than allowing almost two months to pass without significant progress.
Organize an Open Dialogue:
Since you have already expressed your concerns about how the bill reflects interactions that you didn’t anticipate being charged for, it’s crucial to have a direct conversation with the senior accountant or a manager in their firm. Be assertive but professional; outline your expectations and seek to clarify the billing structure moving forward.
Practical Recommendations
Request Clarity on the Invoice:
Ask for a detailed breakdown of the work completed as it pertains to the services you believed you were initially engaging for. This might give you more context and allow you to challenge items on the bill that you didn’t deem necessary or relevant.
Explore Alternatives:
If you find that the current accountant is not meeting your expectations, begin to explore other options. Seek recommendations from other small business owners or professional networks to find a firm that aligns with your needs. Opening up the dialogue about previous experiences can lead you to find someone who operates in a more client-friendly manner.
Establish Clear Expectations Going Forward:
Whether you decide to stay with the current firm or transition to a new one, make sure to clearly establish expectations regarding timelines, billing practices, and deliverables. It can be beneficial to have these documented in your engagement letter to avoid misunderstandings.
Consider Putting Everything in Writing:
When you have significant discussions, whether regarding billing, procedures, or project updates, summarize them in an email to the accountant. This creates a paper trail that could be beneficial if misunderstandings arise later.
Reflection on Roles
Finally, it’s important to recognize that law and accounting practices can vary widely. While the firm might just be following their internal procedures, it’s essential to have a service model that aligns with client expectations. You’re not crazy for expecting upfront clarity and responsiveness; those are fundamental tenets of good client-service provider relationships.
Understanding the structure of your current engagement can provide the necessary clarity, and remember: it’s your business and finances at stake. Always advocate for your needs and ensure that you feel comfortable with the services you are receiving. Good luck, and I hope you find a resolution that works for you!
It sounds like you’re navigating a very frustrating and complex situation with your accountant. From your description, there are a couple of crucial points to consider that might help clarify where the disconnect is occurring:
1. **Communication and Expectations**: It seems there was an initial agreement on the scope of work, but the way the accountant is billing for every interaction is shifting the nature of that agreement. It’s important to have clear communication about billing practices upfront. Perhaps, a candid conversation with your accountant about how you’ve typically seen fee structures in the past could help. Many accountants offer retainer services or fixed fees for specific tasks, which might align more closely with your expectations.
2. **Access and Workflow Management**: The delays in accessing your QuickBooks software raise another red flag. If the team doesn’t have the necessary tools to perform their work, that’s something that should have been addressed much sooner, especially after you facilitated the access. Consistent follow-up and perhaps requesting a timeline for when the accountant can take action could keep things on track.
3. **Assessing the Value of Services**: As you mentioned, charging for every minor interaction can feel excessive, especially since it’s leading to delays in tangible results. This could be an opportunity to discuss the value you’re receiving from their services. If the workload isn’t matching the costs, you have every right to question whether this accountant is the right fit for your business.
Ultimately, while it’s important to remain professional and open to feedback, you also deserve a level of