Our accountant is raising their fees based on our revenue figures. They have a broad pricing model based on annual revenue, that doesn't take into consideration any other factor (e.g. number of transactions, complexity..etc). Our revenue figures increased during the year and hence they are revising the contract so we'd pay three times as much as what we paid at the beginning of the year. We are looking for quotations from other accounting firms, but we're faced with the question: what's a good price? Since accountants charge monthly here in Ireland, and we barely interact monthly (we do our own book keeping), it's hard for us to evaluate their worth based on the amount of work done since most of it will be done at the end of the year.
Well, I understand your need.
There are multiple components in accounting itself. List down all activities he is doing such as bookkeeping, Accounting, compliance, and Financial Strategy and Tax Planning. Find out the total transaction of your business and total revenue. Ask yourself do you need a comprehensive service - compliance, Financial Strategy, and Tax Planning? Now each job is different. It all depends on your total revenue, number of employees you have.
To minimize the cost you can opt for outsourcing your non-critical work out of Ireland. Companies outsource their accounting and tax jobs in India, and other Asian countries You can save some money. You can also outsource your According job to Ireland based company. According to some industry expert, there is no benchmark however in some cases they say it is 4%.
Now before outscouring or employing anyone you should follow the Lean Outsourcing Process to create a Req Document.
1. Write down the problem statement
2. List down all activities
3. List down total transactions
4. Your Total Revenue
5. In the current situation how much you are paying?
6. What is the % account cost you are paying of the total revenue?
7. How many days accounting person comes in a month and year?
8. When you need Most?
9. Create an Analysis document from this activity - define a matrix
10. Finally, create a Requirement Doc.
11. Start Collecting quotations based on this document
12. Keep Interviewing people and select top 3/5 do the price negotiation -
13 Build a Vendor Value Proposition worksheet - who is giving what
14. Finally, Select the best.