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    #16
    Flat Fees

    Hi Skate - I generally have good results by giving the client a flat fee estimate, but that takes some experience. Here's what I generally consider:

    The number of transactions on a bank statement.

    Unresolved problems with taxing agencies.

    Number of employees.

    Multi state transactions.

    Inventory.

    Multiple entities.

    Sloppy recordkeeping, no receipts, messy files, no copies of important docs.

    Inexperienced inhouse bookkeeper.

    Software I'm not familiar with that is used basically as a word processor to print checks.

    Bad banking practices - bounced checks, poor controls over cash, problems with cash flow.

    I look them up online in superior court public records to see what their history is in regards to suing and being sued. I look them up online in public records to see if their licensing (if any) is current and good. Better business bureau. Anything I can find.

    These are things that I consider when estimating fees. Unless the books are really good, I might charge around $500 - $700 per month for write up on MY software, not his, and I'll provide Management Use Only financial statements. I refuse to prepare payroll and refer clients to a good payroll preparer - noting that my fees are much higher than a specialist. I might charge a minimum of $500 for the Corp Fed return and $150 per state return. I also charge $100 per hour for work not specifically identified on my Engagement Letter. Can't stress the importance of that Letter.

    I'm flexible. I'll discount fees or even lower the monthly fee if the client is trainable and becomes easier to work with or refers me to lots of really good clients. It's easier to discount than to raise fees. That's important to remember.

    Payment is due on receipt of the invoice. I don't start on the next month until I've received payment for the last month. New clients should expect to pay a retainer for any work needed to correct their records so you can begin with good balances. I always give a higher rather than lower estimate for this work. Don't let the client get ahead of you on fees. They will pile up and you'll get left holding the bag. And don't be shy about asking for payment.

    Easier to refund or apply overpayments than to collect underpayments. Easier to discount than to raise prices.

    If the client balks at the cost and goes somewhere else, perhaps that frees you up for the good paying, higher quality clients.

    Good luck and don't be afraid to charge good money for your good work!

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      #17
      What kind of business does he have?

      Call it a consulting service. A consulting service for which there is a demand.

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        #18
        Originally posted by BOB W View Post
        .... I'm wondering if maybe he is the problem, wanting to do everything himself. Maybe the accountant is given his records at the end of the year in a mess?
        Yes, as i've said before i've dealt with clients who've had bad records. If this guy was on quickbooks i wouldn't worry to much about it. I'd go in before year end and make adjustments. But i know that 'personal' software doesn't allow for accountant's journal entries. It seems that since you can not adjust books in the conventional manner you're almost forced to just let it grow in to a bigger and bigger mess.

        The other option is to go in and make adjustments as if you were an in house employee. But then if it came to audit there would be a grey area as to what transactions were entered by the client and what was entered by the accountant.

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          #19
          BHoffman,
          My sincere thanks for bringing up all of those issues.

          I'm aware that many accountants will farm out the payroll to a service. In this situation does the accountant generally farm out the 941s, 940s & W2, etc. also?

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            #20
            Bump

            This account is mine if i want it. And i'm thinking that i will take it.

            This corp used to have employees in another state but no more. The interstate activity -- payroll and nexus -- will not be a problem.

            Payroll records looked fine and i don't see a problem with me picking it up.

            It really does not appear as though their present accountant had to put out fires. Quite the opposite, in fact, the present accountant appears very lax and unresponsive.

            We discussed business software vs personal/'money' software and he sounded very interested in using something more sophisticated such as Quickbooks or Peachtree. He is interested in streamlining his 'invoicing' system which is archaic.

            Fee for my services

            When he brought it up i told him that my fee is contingent on size and complexity. And that it was very hard for me to know exactly how much time it would take me.

            "I don't want to nail you down [to a fixed fee that can not be adjusted],' he said. He also said that my fees sound reasonable.

            He knows me from our skate club in which i often volunteer. And it's evident that I started to gain his trust before we ever talked of taxes.

            I'll ask him for a check before i start.

            Thanks again, very much to each of you who have provided suggestions, feedback and advice. I am starting a new thread with a whole new set of questions and concerns (if your interested ).

            I'm going to spend a little time searching old threads before posting up the concerns i have over this guys situation. His situation is kind of odd. I'll explain shortly.
            Last edited by Skate1968; 11-08-2008, 08:53 AM.

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