How much does it cost for Accountability to do your bookkeeping?

So this is a really difficult question to answer. But it’s a really important question – and so what I’m going to do here is to explain how we approach pricing at Accountability.

Can there be a single price for bookkeeping?

Every business we meet is completely different and there cannot be a ‘one size fits all’ solution.

Some businesses raise sales invoices in Xero – some sell online on a website. Some make sales via a till. Sometimes your customers need to be encouraged to pay with a bit of credit control. If you raise sales invoices they could have 1 line of detail, or 100 lines of detail.

Some business owners have all their invoices and receipts and can supply these quickly. Some need support with putting in place systems to make that happen. Some businesses ask us to look after an accounts inbox, so we can deal with suppliers, chase up missing invoices, reconcile statements. Some business owners ask us to look after payment runs.

The problem with hourly rates

When I first started in practice, the market rate for a bookkeeper was £25 per hour for this work. I charged the same rate when I started.

I quickly discovered that charging by the hour came with a couple of key issues:

  1. Our fees changed every month – and our clients had NO IDEA how much we would charge

  2. Sometimes we would need to call HMRC on behalf of our clients and it takes a couple of hours. Sometimes we run into an issue with an integration and it can take a couple of solid days to get to the bottom of the query. 

Our clients didn’t want to pay for 2 days at £25 an hour when they couldn’t see a tangible benefit.

Falling into the ‘market rate’ trap

Not only this – but falling in with the market rate was a silly business practice. Our competitors are largely unqualified individuals – so we were selling our skills and experience short. Charging a rate set by the market meant that we had no scope to pay for the things that are important to us and our clients – training, professional qualification, and experience.

 The Accountability Solution

So I took the decision years ago that we had to fix our fees every month. This gives our client absolute certainty about what they have to pay every month - no more variable fees.  We were also keen to make sure that our pricing was consistent, transparent and fair.  But how to do it?

We now have a pricing model that takes into account three key factors:

  1. What would you like us to do for you?

  2. What kind of volume of transactions does that involve?

  3. What skill level will be required to complete this task?

It’s broken down by area – so to fix a fee, we’ll discuss where your sales come from, whether you want us to credit control, how many bank accounts you have and how many transactions? We’ll ask about management accounts – how frequently would you like them? Do you need us to report on a job-by-job basis? Would you like a cashflow forecast? Do you want a report on budget variances?

We review the pricing model once a year, typically in January – and then we review our clients’ fees. This is done with them – so we know that we are providing exactly what they want us to provide – at a rate they are happy to pay.

But this doesn’t answer the question …

So – here are a couple of examples to illustrate how we approach our pricing structure

Example 1

A client runs their own sales invoicing but could do with help chasing up around 5 – 10 stubborn payers each month.

There are around 75 purchases a month – and the client would like these to be authorised by budget holders before they are paid. We manage a payment run monthly. We also run an accounts inbox and deal with around 10 statements per month.

We prepare a quarterly VAT return for approval and submission. We reconcile the bank accounts every month which have around 130 transactions per month after including credit card transactions.

We prepare quarterly management accounts, calculating profit and loss by job. We provide a management accounts pack to the client in time for their quarterly board meeting.

We provide payroll for 3 members of staff who are paid monthly, plus look after all the pensions admin.

For this package, we would charge £800 per month + VAT. Included in this would be the cost of Xero and Dext.

Example 2

A client runs a service company and raises their own sales invoices in Xero. There is no need for credit control as all clients are on direct debit agreements.

There are approximately 30 purchases a month and around 60 bank transactions all together. The client doesn’t need us to help with payment runs.

We run a VAT return once a quarter. We pull out monthly management reports plus a monthly cashflow forecast.

There is no payroll – so no need for us to quote for that.

All in all, this comes in at a monthly fixed fee of £620 per month, again including Xero and Dext.

Who will actually provide the work?

Every client has two (or three) named people on your team.

  1. A Senior – who will prepare the management accounts, meet with you to discuss your reports, review the VAT return, and submit it and also prepare a year end file.

  2. A Junior – who will process your purchases, prepare payment runs, liaise with your suppliers, provide some credit control support and look after your accounts inbox.

  3. A Payroller – who will run your payroll each month.

You get the right people, appropriately qualified, for the right tasks – at the right price.

How do I get MY price?

If you’d like a copy of this year’s pricing calculator – email us and we’ll happily share a copy with you. If you’d like to book in for a quick chat – to have us calculate a fee proposal for you – then use the booking link here 😊

Rosie Berridge