Accountant charging full annual fee even though I joined them mid-year

[telios]

Hi ,

I just joined BFCA whom I approached in June 2009. They are now invoicing me for all the months from the beginning of 2009 starting from January up to July (current month). I understand that their fee is an annual one so according to them, you will pay they entire annual fee regardless of whether you join at the start of the year or you join mid-year. I just wanted to know that is "right" from legal and professional viewpoints since to me it seems unfair to bill someone for a period of time when they weren't even your client!

Your feedback on this would be appreciated.

[gadgetman]

Did you not read the terms before you signed up? There is no 'right' or 'fair' here, its a service with terms and conditions. If you didn't like it you should have gone elsewhere.

Hi ,

I just joined BFCA whom I approached in June 2009. They are now invoicing me for all the months from the beginning of 2009 starting from January up to July (current month). I understand that their fee is an annual one so according to them, you will pay they entire annual fee regardless of whether you join at the start of the year or you join mid-year. I just wanted to know that is "right" from legal and professional viewpoints since to me it seems unfair to bill someone for a period of time when they weren't even your client!

Your feedback on this would be appreciated.

[sweetandsour]

Hi ,

I just joined BFCA whom I approached in June 2009. They are now invoicing me for all the months from the beginning of 2009 starting from January up to July (current month). I understand that their fee is an annual one so according to them, you will pay they entire annual fee regardless of whether you join at the start of the year or you join mid-year. I just wanted to know that is "right" from legal and professional viewpoints since to me it seems unfair to bill someone for a period of time when they weren't even your client!

Your feedback on this would be appreciated.

I don't know what services BFCA are providing you with, but assuming it is Limited Company accounts then the monthly fee that these accountants all charge is for your budgetary convenience only.

There is a load of work to do at the company year end and not much in between.

The monthly fee allows you to spread the cost throughout the year, it doesn't mean that your accountant does an hour's work for you every month and you will find it unhelpful to think of your accountancy fees in those terms.

[PhilAtBFCA]

Accountant charging full annual fee even though I joined them mid-year

Hi Telios

Good point :-)
We do charge an annual fee for sure, that is paid monthly by our clients as its good for cash flow on both sides.
However where clients join us in the middle of a financial year we do tend to invoice the whole year, during that financial year. After all there is still a years worth of work to do !
Where the new client has either a) paid an accountant a monthly fee and cant get it back or b) paid for FreeAgent uding the year
We do tend to make an alternative arrangement, basically so that during the financial year you are not paying twice for things.
Each individual case is different but in your case, which I wont discuss directly here, I have asked the team to contact you, and I think our team could have done a better job at welcoming a new client ! ( Although this is just one part of our correspondence with you !)

I hope that helps

Phil

[telios]

Thanks Phil for clarifying your position on this.

In response to the points rasied by the other members in this forum; while I do appreciate that the majority of an accountants work comprises preparing year-end accounts, the fact is that a client who joins an accountant late in the year is not going to generate the same workload as a client who has been there at the beginning of the year so in some cases there should be some type of compromise.

Any contractor changing accountants during the year would have most likely already paid their previous accountants at least up to the month of the changeover and so they could be faced with the expensive prospect of paying a full annual accountancy fee with a new accountant mid-way through the year. I will certainly keep this in mind for future reference.

To Phil, I look forward to a long working relationship with BFCA

Thanks again,

[RichardCranium]

while I do appreciate that the majority of an accountants work comprises preparing year-end accounts, the fact is that a client who joins an accountant late in the year is not going to generate the same workload as a client who has been there at the beginning of the year so in some cases there should be some type of compromise.

They could also argue that there is effort involved in taking on a new client and they do not charge for that. So they could argue they have compromised.

A few weeks ago Nixon Williams said they check the previous year's accounts when they take on a new client; he also recommended people should change ASAP after the year end accounts are done. Handy advice; I've just followed it myself.

Any contractor changing accountants during the year would have most likely already paid their previous accountants at least up to the month of the changeover and so they could be faced with the expensive prospect of paying a full annual accountancy fee with a new accountant mid-way through the year. I will certainly keep this in mind for future reference.

Ask for some of it back?