Another reason to can time sheets

by admin on August 30, 2010

in General

Post image for Another reason to can time sheets

I’m seeing a steady stream of firms eschewing the time sheet in favour of fixed pricing. Nice. Yesterday I came across a great reason for doing so. Check this post from an AWeb reader:

Basically, I have done bookkeeping work for one of my client but, unfortunately there is no engagement letter / contract and now client is not paying anything.

In my initial meeting with the client at his office we decided bookkeeping work cost will be £350 pm and we need to streamline previous 10 months work which client has put in excel spreadsheets. Now, when I have put all the data from excel to Sage client is refusing to pay.  Instead he is saying your bill of £1,200 for putting data from excel to sage is very high and we are not going to pay it and threatening me by saying he will send me legal letter if I press this issue again.

(I have posted over 2100 transaction from excel to sage.)

The chap was on the right track but then blew it. While everyone was busy fretting over the billing problem, my response, which I entitled ‘classic cock-up’:

At the top of the post you say:

“we need to streamline previous 10 months work which client has put in excel spreadsheets.”

Why? You are so close to the year end you might as well have simply concentrated on open items and treated the remainder as part of the annual accounts preparation work. That way you are communicating value to the client and not simply attempting a book-keeping exercise that is pointless.

The lack of an engagement letter doesn’t help but I’d suggest that working on a time and materials basis for the 10 month work is part of why you are in trouble on this. If you’d thought this through more thoroughly then you could have given him a get out of jail card while doing yourself a favour in learning about the business AND kept the deal consistent. As it is, you’re at risk of losing the whole thing.

But also – if you agreed £350 pm and 10 months have ‘cost’ £1,200 then surely you are potentially way ahead of the game?

I think you’ve got a dilemma on your hands. You ‘agreed’ £350 but have demonstrated that 10 months can be done for a fraction of the price. I know it is not that simple but put yourself in the client’s shoes.

At this stage I would take a hit on the £1,200, offering to put it towards year end.

Oh – and by the way…Sage? Are you asking for trouble taking a client from spreadsheet to Sage?

Enough said.

Image courtesy of: Mark Loveridge

Comments have been disabled for this post.
Sort: Newest | Oldest
Wayne Schulz

Looks as if the link to the original post goes to a private discussion forum.In general if this was a new client that the person was taking on - then I'd submit they've potentially fallen for one of several tricks:1. They believed a story about the prior accountant / consultant -- actually if there's any badmouthing the prior accountant / consultant my radar is instantly on high alert (meaning there's good potential I'll be next).If the client has more than one story to tell about a prior bad experience - run for the hills.2. Get the money up front. The accountant /consultant that's providing the service didn't create the mess that the client is in -- so they shouldn't be bearing the risk of collecting the fee for cleanup work.3. Clients who threaten legal action are not worth knowing. Consider yourself lucky that they've hopefully taken you for a small amount. Let them find someone else -- tip your friendly competitors about this client -- but do not warn the competitors who hound you the worst. 4. Lastly the position that I've taken is to fix fee our engagements as we've seen many consultants do. The client has the expectation that we''re the expert and should be able to give them a cost to "fix" their problem.

share
  • spam
  • offensive
  • disagree
  • off topic
 Like
Wayne Schulz

Looks as if the link to the original post goes to a private discussion forum.

In general if this was a new client that the person was taking on - then I'd submit they've potentially fallen for one of several tricks:

1. They believed a story about the prior accountant / consultant -- actually if there's any badmouthing the prior accountant / consultant my radar is instantly on high alert (meaning there's good potential I'll be next).

If the client has more than one story to tell about a prior bad experience - run for the hills.

2. Get the money up front. The accountant /consultant that's providing the service didn't create the mess that the client is in -- so they shouldn't be bearing the risk of collecting the fee for cleanup work.

3. Clients who threaten legal action are not worth knowing. Consider yourself lucky that they've hopefully taken you for a small amount. Let them find someone else -- tip your friendly competitors about this client -- but do not warn the competitors who hound you the worst.

4. Lastly the position that I've taken is to fix fee our engagements as we've seen many consultants do. The client has the expectation that we''re the expert and should be able to give them a cost to "fix" their problem.

share
  • spam
  • offensive
  • disagree
  • off topic
 Like

Previous post:

Next post: