Any help from CRO for struggling business?

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Andrew123

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Can anybody help me, Like most small businesses I am finding it really difficult to stay afloat.

My main worry at the moment is having to return my accounts to the companies office. I was late for 2006 as I simply hadnt got enough money to pay the accountant, when I did get the money together my accountant charged me 9,000 + vat last year to get them returned urgently as I was threatend with strike off. He is now doing my 2007 accounts and I reackon it will be the same charge. We have a turnover of about 230,000 a year and employ 19 people (mostly part-time), we dont even make 9,000 profit, in fact we have suffered losses for the past 3 years. There is very little to do with our accounts as we employ a bookeeper and there is no VAT returns as we are classed as eductional status. My question is, in order for me to simply be compliant and return a piece of paper to the CRO I have to get my self into huge debt each year to do this, does anyone know if the CRO are making allowances for small companies like me who want to be compliant but are finding it impossible to come up with the accountants fees. I have to pay the CRO 1200 + VAT in fines before I even pay the accountant.

This is keeping me awake at night as I am due to return my accounts in July.

Any advice is greatly appreciated. Thanks in advance.
 
Andrew123 said:
Can anybody help me, Like most small businesses I am finding it really difficult to stay afloat.

My main worry at the moment is having to return my accounts to the companies office. I was late for 2006 as I simply hadnt got enough money to pay the accontant, when I did get the money together my accountant charged me 9,000 + vat last year to get them returned urgently as I was threatend with strike off. He is now doing my 2007 accounts and I reackon it will be the same charge. We have a turnover of about 230,000 a year and employ 19 people (mostly part-time), we dont even make 9,000 profit, in fact we have suffered losses for the past 3 years. There is very little to do with our accounts as we employ a bookeeper and there is no VAT returns as we are classed as eductional status. My question is, in order for me to simply be compliant and return a piece of paper to the CRO I have to get my self into huge debt each year to do this, does anyone know if the CRO are making allowances for small companies like me who want to be compalint but are finding it impossible to come up with the accountants fees. I have to pay the CRO 1200 + VAT in fines before I even pay the accountant.

This is keeping me awake at night as I am due to return my accounts in July.

Any advice is greatly appreciated. Thanks in advance.
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What do you get done for €9k- Extremely high figure, what included in the bill?

What is your annual return date and account year end?

Cro make no allowances for normal companies.
 
My accountant said that we are not audit exempt because we were late with our accounts so he had to do a full audit and that he had to do it in a rush as we had a strike off notice. I simply got the accounts returned to the companies office. We are due in July each year. So currently he is doing my 2007 accounts and I feel he is going to charge me the same as last time. He said he has to 'audit' me for at least two years because I am late, he knows we have virtually no business at the moment. Currently any money we have is to going to pay him and other bills have to wait because of this, its a nightmare, constanly juggling who to pay and when. Thanks for the reply.
 
Please clarify that €9k was for one year 2006?

What was on the fee invoice for the €9k.(did this include company office late Fee)

Are you records good, and on computer.

You have to give more information of what was done for €9k- Seems a very high fee for such low turnover.

Please elaborate more
 
One piece of advice - get a new accountant. - Mine charges €500 a month for an all in service. I put all invoices / statements etc etc into a box & he picks it up every 2 weeks, does all the returns, does end of year & does all wages. Provides a monthly report on finances & quarterly management accounts.

Once you have your accounts audited, you can then get exemption from audit for the following years.
 
I would agree that 9k seems very high.

My bf's business has a similar turn over and employees.

He's payes 2k a year for all his returns to be done. Everyform that need to be submitted goes directly to the accountant and he deals with it. Apart from giving him invoices, reciepts and a monthly breakdown which is emailed he does little else in relation to his accounts.

I would start phoning around other accountant to get a better deal. It seems point less to pay 9k in account fees when your comapny isn't even making 9k in profit each year. And i think it's extremly unfair that your account didn't make returns on time because you didn't have the money to pay him, which caused you to have to pay more. Talk about not giving someone a break in a hard time. You had been using him for a while it's not like you were a new customer and were going to up and disappear.
 
The problem here is the audit requirement. If a company is late filing then the accounts for the late year AND the subsequent year must be audited. So if 2006 was late then 2007 must also be audited. Going on turnover alone does not give a good indication as to what the fee should be. You could have a company with a million euro turnover and because of good records and systems matching between the company and the accountant the annual accounts/returns might cost 3-4K. THen again a cash business with turnover of 100K with appalling records requiring audited accounts might indeed cost 9K if the time taken to complete the work was very large.

That being said, 9K seems to be an "overtime and short notice" fee. Other work is being pushed aside and work done at short notice possibly at night & weekends so as to get this job done. The auditor may seem to be using that lateness to justify the fee. The CRO give no quarter when it comes to late returns. It is up to the individual company to ensure that they have the returns done on time. For the OP to get out of the chicken & egg situation they are in with being late due to trying to raise the audit fee then the audit fee itself creating more cash problems requires breaking the cycle. If they can get to the point where they can apply for audit exemption then the accountancy fees should fall dramatically. If they do not then they need to move accountants fast.
 
samanthajane said:
And i think it's extremly unfair that your account didn't make returns on time because you didn't have the money to pay him, which caused you to have to pay more. Talk about not giving someone a break in a hard time. You had been using him for a while it's not like you were a new customer and were going to up and disappear.
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Unfortunately it is often the existing client who leaves unpaid bills not the new one. However I would have handled this very differently for an existing case. Firstly the priority is getting the returns filed. No accountant wants the unnecessary work of an audit ( even at higher fees ) , believe me, they are a right royal pain in the calculator. Audit exempt cases are generally cleaner and are less risk for the accountant. I would have thoght that a direct debit arrangement over some months or even a year would allow the bill to be paid, the client to have less cashflow strain and gives the accountant regular income. Then carry on to the next year in similar fashion and eventually when get to audit exempt point go back to full fee on completion which would be the norm for me. I do wonder why the auditor felt it necessary that they had to get the fee up front before filing.
 
Bear in mind that we're only hearing one side of the story here. Maybe the OP has the accountant plagued with phone calls throughout the year. Perhaps the OP is the part of the classic 20% that takes up 80% of the accountant's time.

Also, there is book-keeper in place but how good is he/she. Another old saying is that the only thing worse than no book-keeper is a bad book-keeper. There's a whole host of things that can ring up a bill like the one the OP was charged.

Also, I can understand the accountant asking for money in advance. If the business is struggling, maybe the accountant is concerned that the work will be done and not paid for. The accountant has a right to protect his/her own interests and the fact that not even €9k in profit was made shouldn't affect accountancy fees. The accountant doesn't work on a commission basis. He/she charges based on their time taken and the level of skill and responsibility involved.

If the OP really feels they're getting a bad deal, maybe they should shop around. One thing's for sure, they're not going to get any breaks off the CRO.
 
Andrew,

Maybe just talk with your accountant and ask him/her what they charge per hour and what their staff charge per hour and become familiar with this.

Without knowing how good or bad the books are prepared on a monthly basis it is difficult to determine if the 9k fee is high. What you will often find is that if you can get the same firm to do your book keeping and the audit that they will be more efficient and that fees reduce! It will also enable the accountant to stay up to date with making filings to the CRO.
 
Thank you to everyone that has replied. I meant to say in my original post that I paid him 9,680 (vat was 1680 of this). I also paid him 1240 for CRO late filing fees a total of 10,920.

Just for the record I never phone our accountant from one end of year to the other and we have no bad debts we keep our heads above water just about, but the amount that is charged is a huge dent in our cash flow. I just received a letter today from CRO to say that our 2007 accounts are overdue and they will begin strike off in 8 weeks if we dont reurn our accounts so here we go again.

We have a very good bookeeper who submits everything on computer and hard copy for the accountant as we try to make everything neat for him.

I have taken in and listened to all your advice and may aproach the CRO for an extension on time - not sure if they will do that for us.

Thanks again to you - all you've been great.:)
 
Forgot also to say that we are classed as 'eductional status' so we cant claim back the VAT even though we have to pay it.
 
Andrew123 said:
Thank you to everyone that has replied. I meant to say in my original post that I paid him 9,680 (vat was 1680 of this). I also paid him 1240 for CRO late filing fees a total of 10,920.

Just for the record I never phone our accountant from one end of year to the other and we have no bad debts we keep our heads above water just about, but the amount that is charged is a huge dent in our cash flow. I just received a letter today from CRO to say that our 2007 accounts are overdue and they will begin strike off in 8 weeks if we dont reurn our accounts so here we go again.

We have a very good bookeeper who submits everything on computer and hard copy for the accountant as we try to make everything neat for him.

I have taken in and listened to all your advice and may aproach the CRO for an extension on time - not sure if they will do that for us.

Thanks again to you - all you've been great.:)
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You should note that you only actually paid him €8,000 for the audit. The CRO fees are payable to the CRO and the VAT to the revenue - he is not charging you these amounts. In addition if get your books in order your fees will come down. The nature of your posts suggests that there is nothing unusual in the fee he charges you, especially given the deadline nature of the job and the fact that an audit had to be done - this involves a lot more work than just putting accounts together and carries a fair amount of risk to the auditor. I also imagine there are taxation and Co. Sec fees included in the bill also.

Also this idea people have that accountants should more or less work for nothing because they are not supplying anything tangible is crazy. Perhaps if you had a discussion with your accountant on how to improve your business, cash collection etc you might actually turn it into an efficient business.
 
ED D said:
Also this idea people have that accountants should more or less work for nothing because they are not supplying anything tangible is crazy.
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I don't think the OP expected the work for nothing. However I agree that there are professional services where the client does not sometimes appreciate the time and cost of experience/qualification that goes into producing the work. Accountancy/audit is sometimes seen as a necessary but useless cost. Another poster some time back said their accountant couldn't have much costs as "shure he worked from home". Accountants have costs as any business does. Auditors have higher costs still. The annual CPD / Prof Indemnity Insce / Membership etc. costs for an auditor are very high. Yes they get well paid, some get very well paid, but is not the labourer worthy of their hire? Was that not what they expected to attain after all the college and professional examinations and associated blood, sweat & tears. As in any free market, if one has a problem with audit/accountancy costs then shop around.
 
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