Am I expecting too much from accountant?

[EssCee]

I feel frustrated with the service I'm getting from my accountancy firm, but I'm not sure if I'm expecting too much for what I pay (£550 per quarter).

I have an ecommerce business (ltd company - vat registered - 2 employees on payroll) and use Kashflow. I hadn't been able to get monthly P&L reports from Kashflow (due to when they make adjustments to the accounts, etc.), so we recently changed their scope of service to enable me to do this, going forward. To do this, they handed my account to another accountant there (who I suspect is more junior).

Anyway, I have just looked at the P&L report for 2017 (calendar year) and our net profit is way below expectations. Yet, the accountant seems completely unperturbed and not open to trying to explore why (and if there's any errors from their side of things).

Ideally, I'd like someone that can help me understand my P&L and changes in net profit... and make some suggestions on how to improve financial performance.

Any thoughts/comments very much welcome.

There are two broad types of accounting work, statutory and management. It sounds like you’re paying for someone to do your tax, VAT, PAYE, deal with HMRC. These are all statutory matters ie things that need to be done to keep the govt happy.

If you want someone to advise on profitability, margins, appropriate charging products/services ie things that will help you manage your business you need to also hire the services of a management accountant.

You’d be looking for a CIMA qualified management accountant if you want this service, and this would be in addition to the statutory work your current accountant is doing.

Also the price of £550 per quarter seems reasonable for what you say you are getting now.

I pay £360/quarter for everything you are getting plus excellent service and good advice on anything financial I ask. They are called Crisp Accountants or Accountancy or something. Google them. I've zero complaints.

@Justanotherzombie it sounds like it’s not financial questions that the OP has, rather they are looking for guidance on how to increase profitability.

Sore you yes, I was just really commenting in the cost. Though they did talk me through each line of my P&L and explain any numbers I didn't understand.

If you want meaningful and accurate management accounts then £550 per quarter is very much on the low side (dare I say far too cheap for what you expect). The firm I worked at 20 years ago were charging more than that for quarterly management accounts for relatively small businesses. £550 per quarter is about average for yearly accounts, annual tax, payroll and VAT for a small business. I'd say you could double that to get proper quarterly accounts with adjustments for stock value changes, accruals, prepayments, depreciation, sanity checking and discussions with you.

It would be mich cheaper for your to employ someone 1-2 days a week to focus on bookkeeping and management accounting. That way you will get what you want out of the reports.

Thanks for your comments, all.

At the moment, Kashflow does most of the heavy lifting. I do the bank reconciliations and stock journals. The accountant does the checks and adjustments, and what we need to do for compliance.

I'm looking for visibility (e.g. download of monthly P&L report from Kashflow) and to be able to discuss this on the phone with someone on a quarterly basis (e.g. highlight fluctuations in key financial indicators, e.g. net profit margin, and help me drill down a little bit into why this might be - e.g. increased items of expenditures).

I'm not looking for someone to help with specific business strategies on improving profitability, as I see that as my area (but I need accurate data to help me make the right decisions).

I'm in the North West, by the way, if that makes any difference!

I think it's partly because I did used to have a great accountant (very small practice), who was bought out by the bigger firm that I'm with now. I felt like the last accountant understood my business... but maybe what I'm getting now is more standard?!

Have a chat with Connaughton and Co in Manchester, if that's anywhere near. They're on Chorlton Street, near the bus station.

We use them for the company I work for, and I've always found them very willing to natter and answer questions. We pay them a fair bit more than you're quoting for your charges, but we are also a good bit bigger.

Thanks ginnybag.