1 – They misrepresent their qualifications
Why should anyone trust an accountant who claims to be qualified when they are not, or who claims to be a member of a body to which they do not belong.
What about those who claim that membership of a particular group or body constitutes a qualification even though membership does not depend on a period of study or exams?
Clarity – I clearly show on my website, and all media that I am MAAT qualified and that I am a registered Member In Practice with my governing body AAT. I would never lay claim to be anything else.
2 – They claim to have more experience than they do
Again this speaks to the issue of trust. There is a big difference, in my mind, between those accountants who offer a wide range of services knowing that they will outsource some work, compared with those who pretend to be more experienced than they are.
Some accountants may feel insecure about their limited experience; others have the confidence to be open, honest and truthful.
Clarity – I have never made claim that I could work miracles! and I can honestly say I have turned work away as I felt it was above the scope of services I was comfortable to do. This said I know some people will take on work and fuddle their way through it. I can’t do this as my stress levels would go through the roof!
3 – They are unaware of what they don’t know
This is more a consequence of ‘unconscious incompetence’. If an accountant doesn’t know what they don’t know, they won’t know when to stop and get a second opinion before telling a client what to do or when predicting the outcome of their dispute with HMRC.
This is dangerous and often leads to protracted negotiations with the accountant trying to resolve things the way they predicted even though a specialist would have known better from the outset.
How does anyone know what they don’t know? It’s more a question of getting a good balance between:
(a) Confidence that we have a good broad range of knowledge on a specific topic, and keeping uptodate so we can expect to be aware of recent changes, and
(b) Simply assuming that we know everything and failing to attempt to keep up-to-speed on recent developments
Clarity – As a AAT MIP I have strict CPD requirements which I adhere to. However I think it is my engineering background and inquisitive mind which leads me to investigate, learn and check any issues I feel I do not really feel confident in. As an engineer if I failed to ensure my knowledge of the work done was correct it could have severe consequences, it is no different acting as a clients accountant. If I get it wrong there are still severe consequences. Sadly I have to admit I am a perfectionist – but that is not a bad thing in this line of work.
4 – They wing it
There’s a difference between following your gut and guessing how to resolve a client’s issue. Past experiences will invariably impact the advice that accountants give clients. The mistake comes when an accountant recognises that their experiences to date are insufficient but that they will extrapolate and give definitive advice anyway, without checking up first and without any caveats.
Clarity – The best move I have done since starting out on my own is find myself an excellent Mentor. If I don’t know it, or am unsure if I am on the right track, he has a wealth of experience and knowledge and is a phone call away. As an engineer you learn’t how it all worked, how systems worked, etc however there is nothing more valuable than experience because just because the text book says put a nut here and the bolt here it does not mean that in practice this is the best way to do it!
5 – They condone tax evasion
This may be more challenging than it seems. It includes knowingly allowing clients to exclude cash takings from their books and to claim tax relief for non-business related (personal) expenditure.
Clarity – If anyone wants to sail over or close to the line please look elsewhere for an accountant. My qualification and good name is worth far more to me than your fee.
6 – They falsify documents
This came up a lot when I used to present talks on ‘How to avoid professional negligence claims (or worse)’. I outlined some of the implications of the Forgery and Counterfeiting Act 1981.
Among the offences this Act addresses is making a false instrument (eg a document) with the objective of inducing a third party (eg HMRC) to accept it is genuine so that they will do something (or not do something) to their own or to somebody else’s prejudice.
This would include, for example, backdating the minutes of client company Board Meetings to ‘evidence’ the authority for dividends already paid.
Clarity – Crikey never done this! Must be too much of a goody two shoes. . . .
7 – They fail to anticipate the advice their clients require
This is a simple client service issue. I’m not suggesting that all accountants need to know everything about all their clients. This is more about recognising that clients do not always know what they need to ask for advice about. Auto-enrolment would be a topical example.
Clarity – No I think I’m good at recognising what the future may hold. For instance one of my clients is a little sole trader who’s business is growing rapidly. I have set his accounts up on Sage so that all his costs and sales are departmentalised. An accounting friend said I wasted my time, however I don’t feel I did because now it has been set up in this way as his business grows I am in a perfect position to give him reports and information regarding sales, purchases etc for all area’s of his business. Yes I agree he may not need it this year but when he expands further next year I have all the information at my finger tips.
8 – They do not keep up-to-date
There is no excuse for this now, if ever there was. Much of what accountants need to keep up-to-date is now available by way of email updates, websites like AccountingWeb, online newsletters as well as the more conventional training course providers who offer webinars as an option alongside classroom style lectures and updates.
Clarity – I keep myself as up to date as possible, I receive weekly updates from sourse such as Accountingweb, CCH Online, HMRC, AAT. CPD is very important to me and know that I have embarked on my ATT Tax qualification the future is bright as they say.
9 – They miss deadlines
Clarity – No I have a planner of what has to be done and when, and as and when it is completed it gets ticked off. I also sign up to all reminders from the likes of HMRC and Companies House. This could be due to having too many clients, something I do not want to happen to me. I have experienced working like I am “fighting fires” all the time and hate it. I often worry I am slightly OCD about deadlines but that is not a bad thing.
10 – They ignore clients
Almost every practice has at least a few old clients who pay a little and expect a lot. It may be tempting to ignore them when they get in touch, especially when the accountant doubts their ability to secure adequate recompense for this latest enquiry. Better to be honest though and avoid getting a bad reputation.
Clarity – Sorry I find ignoring people rude. Even if I am very busy I send a client an e-mail saying I will get back to them by a certain date.
11 – They spend more time with prospective clients than with paying clients
Perhaps this is simply a case of poor practice. I’m talking about accountants who make plenty of time to meet with and even give advice to prospects, but who rarely have time to meet existing clients – at least not without wanting to charge for this.
The reason this is on my ‘bad signs’ list is because it implies that the accountant is more focused on growing their practice than on giving a good service to their existing clients. There needs to be a reasonable balance in my view.
Clarity – Very interesting point. I make a point of informing all my clients that if they need me at anytime I am always here. I don’t charge for a quick 10 minute phone call to answer a query – maybe I should – but to me its all part of building a good client relationship.
12 – They boost their time-based fees by being inefficient
Another issue of trust. The facility for accountants to charge more when they are inefficient is one reason why so many clients try to avoid paying time-based fees. Sometimes the accountant may not even be aware they are inefficient; after all there is no incentive to find faster ways to do things when paid by the hour.
Clarity – This is why I prefer to stay away from time based billing. When you have accounts to do there is nothing more annoying than constantly thinking about time spent, it adds a pressure that does not need to be there. I charge a set fee agreed with the client. If it takes me 5 hours or 10 hours that’s what it will cost. It means I feel free to spend time ensuring all the work is carried out efficiently, also making up import sheets so clients can do their own data entry and I can import it to Sage saves me time and them money.
13 – They do not clarify the scope of the work they will do
Client service again. Often there will be a perception gap as between what the client expects and what the accountant is willing to do – without increasing the fees.
Even worse are those accountants who undertake the extra work but do not raise the question of additional fees until afterwards.
Clarity – Shocking all costs to clients are agreed before commencing work, and if it was looking like a big bill I would certainly discuss this with them before it became out of hand.
14 – They reveal a lack of attention to detail
When I was training at Touche Ross in the early 1980s I recall one partner returning to me a letter I had drafted and sent through for signature. He had spotted that the postcode on the envelope was different to that on the letter. I have always remembered the admonishment.
Lack of attention to how we address letters implies a general lack of attention to our work which reduces our credibility and that of our advice.
Clarity – I endeavour not to let my attention to detail slip, however nobody is perfect. Although I suppose the perfectionist in me really does come to the fore front on this one.
15 – They blame HMRC to cover-up their own inefficiencies
Another trust issue. Bad accountants have such low esteem that they are unable to admit when they have made a mistake. It’s all too easy and lazy to blame HMRC even when the accountant is the one in the wrong.
Clarity – So all I can say to this is again falling back on my engineering background, if you do something wrong there is no shame we have all done it. In my experience it was easier and quicker to put your hand in the air and say whoops I think I may have done this than to keep quiet. If you know what your dealing with resolution occurs quickly. I do admit if I have made an error but the most important thing regarding this is that I learn from that error and ensure it never happens again. It is easy to blame HMRC or other organisations than to look at your inner self and admit your not perfect.
16 – They fail to follow up
One of the complaints I often hear is that an accountant hasn’t followed up after sending papers to HMRC (or any third party). They just sit and wait and do not keep the client informed as to what they are doing.
A similar scenario arises when the accountant hasn’t responded to a client’s query or request for action.
Clarity – To much work not enough time springs to mind on this one! Something I do not want to happen here at Clarity, once I’m full I’m full.
17 – They do not keep their promises
It’s easy to lose a client’s trust. Simply promise to do something and then fail to keep your word. That’s true of all human relationships, of course.
Clarity – To much work and not enough time again?
18 – They have insufficient back up and business continuity plans
Whether an accountant relies on the cloud, computer servers in their office or a hosted solution it is crucial they have adequate back up processes in place. Beyond this is the need for the accountant to have a plan to enable them to access all client data etc in the event that physical files, the primary software or online storage facilities cease to be available.
Clarity – This is something I have been looking at as my business has grown and this statement highlights to me I need to look at Cloud backups again. When you start a business it is a fine balancing act of income/costs.
19 – They are indiscreet – whether face to face or online
There is no excuse for breaching client confidentiality, however tempting it may be sometimes. Doing so also breaches one of the five ethical principles that drive the work of most qualified accountants in the UK.
Clarity – Shocking – but I have heard things I shouldn’t of and I find it makes me uncomfortable. I can assure all my clients that what is said in the office – stays in the office.
20 – They work entirely alone
I worry about accountants who have no colleagues, back-up, support, or readily accessible facility to provide any of this when needed. Working entirely alone with little day to day communication beyond clients and HMRC is likely to cause accountants to become quite blinkered, dogmatic and insular. Indeed such an approach could well lead to many of the other qualities listed above.
Clarity – Well when I started Clarity Bookkeeping I went from working in practice to suddenly having the apron strings cut and being all on my own. It was the most daunting feeling possible. This point is so very true, sometimes you just need to be able to talk something through to be able to steer yourself in the right direction. Nobody is perfect and I certainly do not know everything. This is why I have signed up to a mentor scheme. I have a monthly chat with my mentor, we can talk any issues through, check any queries I have, and in basic terms he has grown my confidence in my own abilities. I also made a point of ensuring I had connections with other local bookkeepers and accountants so that heaven forbid I am unable to work I have a network of trusted people I could ask to help me.
Bad accountants invariably have or generate a bad reputation. I wouldn’t care but for the impact this has on the rest of the profession.
Clarity does not rank in the bad accountant sector – phew weee! This article made interesting points, if you read it and think ohhh! All I can say is I have a small pond with big fish. If you are in a big pond with lots of small fish and your not happy with the service you get, just get in touch I have a few big fish positions available in my small friendly pond.