Why Your Accountant is So Expensive!

Have you ever wondered why your accountant charges so much even though you're paying a bookkeeper? Your accountant doesn’t even pretend to be grateful that you’ve made life so easy; in fact, they’re on a permanent war footing with your bookkeeper.

Your accountant says it’s your bookkeeper’s fault that your accounting costs aren’t falling. Your bookkeeper says she doesn’t know what the accountant could be talking about. She’s diligently entered all the data, you’ve watched her do it every month. It can’t possibly be her.

Except it can. And in 90 percent of cases, it is.

We know that’s a hard truth to face. You’ve known your bookkeeper for so long you can’t remember when she started. She comes to the office every month and chops down that pile of unentered receipts and invoices. Things only get more than a few weeks—a month at most—behind when she’s on holiday or one of the kids is sick. But she’s like a friend. You and your staff have coffee with her, you know about her family, she’s come to the Christmas party.

You probably can’t say the same about your accountant.

And because your life got easier when someone else started dealing with that mountain of paperwork and data entry, you’ve probably never asked whether your bookkeeper has any qualifications. She advertised herself as a bookkeeper, you liked her, you booked her to come in once a month, the paper mountain got smaller, and she’s been coming ever since.

But there’s no mandatory training for bookkeepers. Anyone can set up a bookkeeping business, and it’s attractive: be your own boss, flexible work you can fit around other commitments.

What you don’t see, your accountant does. Unqualified bookkeepers make mistakes that are time-consuming (therefore expensive) to fix. Your books have to be gone through with a fine-tooth comb because they’re full of mistakes. You think you’re sending your accountant clean records that should take half an hour to tick off. What your accountant sees is still a shoe box of receipts, it’s just not in paper form. And that virtual shoe box needs to be unpacked and re-sorted.

That extra accounting expense is just the visible cost. The invisible cost is that you could have a much better view of your business, information you can use to make decisions.

In business, “visibility” means financial visibility. When you know your financials, you can make informed decisions. And when you need to make crucial decisions ever more frequently, that means knowing your financials to the day, not the month. Relying on months-old financial information is like trying to drive forwards using the rear-view mirror.

When your bookkeeper drops by monthly to do data entry, your books are at least that much out of date. Not that it matters how recent they are if they’re not accurate in the first place.

It might always have been like this, but it doesn’t have to be. With cloud-based systems and automated data entry, your books can be almost up-to-the-minute. And when qualified BAS and tax agents are preparing your books, supervised by managers who are themselves accountants, your bookkeeper and your existing accountant can work productively.

Bookkeepers and accountants being at war is a common circumstance, but it isn’t inevitable. If accountants wanted to do bookkeeping, they’d have bookkeepers on staff and try to persuade you to use them. If bookkeepers wanted to be accountants, they could take the training and qualify. So if your accountant has a problem with your bookkeeper, there’s likely something to it.

In our experience, when accountants don't have to clean up books that are supposedly already clean, they save about 30 percent of their time.

Your natural instinct might be to find a qualified bookkeeper who will work seamlessly with your accountant—that’s us—and use it to negotiate a reduction in your accountant’s fees. We’ve also seen, however, has been that the real benefit unlocked by getting your books up-to-the-minute and accurate is that you can take your relationship with your accountant up a level.

Your accountant can use the time to liaise with your bookkeeper without adding to your bill. And more importantly, your accountant will have time to work with you on your business. Instead of wasting time (and your money) double-checking what should have been done right in the first place, your accountant can be helping you improve the vital statistics of your business (like cashflow) and advising you on achieving your vision for the business.

If that vision is to have a modern, competitive business, then you need to be working with suppliers and advisors who are modern and competitive. When it comes to bookkeeping, that means:

Showing a professional commitment to their work by getting qualified

Being managed by qualified accountants

Practising what they preach when it comes to following processes that make sense today, not processes that worked 10 years ago

If that sounds like the way you’d like your bookkeeper to work, call us today!