One of the most frequently used reason not to use an accountant is that it is too expensive. It is a service and therefore makes it difficult to explain why we charge what we charge. There is no product or tangible item that is bought. Essentially we sell our time. Our time is worth X amount per hour. Whether clients believe that that price is “worth it” is actually irrelevant.
Everybody has time that is worth something. Many businesses or business owners do not know what their time is worth and so they battle to comprehend how we can put a price on ours. This leads to the above mentioned excuse. I say excuse because “its too expensive” is not a reason.
Break it down
When you break down the cost of an accountant, it actually works out in your favour for 2 reasons:
1. The work is not on your to so list anymore. Hand over the required information and in return, tou get valuable reports to run your business.
2. It works out cheaper. Let’s do the math. A company requires 2 years worth of annual financial statements and is quoted R 24 000. Immediately, it is labelled expensive.
However, if you stretch that cost over 24 months, it is R 1 000 per month.
If you were to hire someone to do this particular job full (or even part) time, you would pay in excess of R 5 000 per month.
Extrapolate this out over 24 months and you reach a figure of R 120 000. This excludes any leave paid or bonuses etc. You get the point.
Value for money
What are you getting from the accountant? When you browse the shop or online stores, you are constantly looking for the correct product. This is an interesting statement but that’s the standard first step. The second step is that you are now looking for the value you get for the product you are buying. You have every right to ask your accountant what you are getting for the money you pay. I don’t, and neither should you, expect them to give an accurate figure including profit etc. They should however, give you a list of services provided. This is when you start wondering if it is too expensive.
Before you leap to the mind set of “too expensive” for your accounts or anything else, run the numbers and see what comes up. Make the decision on facts.
This article was update in January 2023