reality check please

[Annabella]

Hi Guys
I trade SPA (unleveraged) in my SMSF and have just received my accountants bill for last years's financials plus auditing.  Just over $10k fees this year and previous two years were $12k each in fees.  The SMSF has a few warrants and I made about 200 SPA trades during the year (& I provide him with a spreadsheet reconciling the buy & sells & profit/loss & dividends)- can anyone give me a reality check as to whether the fees are resonable for the work done?  My gut feel is that the accountant is ripping me off but maybe I underestimate the time necessary for the accounts? Cheers Annabella

[Shane]

Hi Annabella

I am sorry to say that the guy is ripping you off blind, probably due to not understanding trading, which is forcing him to do a ton more work than necessary.

This conversation has been done before in these forums, though I cannot remember the thread title. Do a search for threads on accounting or related terms.

As a personal example, we did my wife's tax, my tax, our trust's tax and our SMSF's tax for the 07 - 08 financial year and it our bill was heading towards $5k. This was a pretty involved tax year for us, but was handled beautifully.

My wife owns 2 rental properties as well as having a couple of Macquarie managed funds (more's the pity)! I invest for both our trust and the SMSF. To do that, I trade equities and CFDs through SPA and elsewhere. I trade commodities and FX as well as options.

In the move from investor to trader in 07, our previous accountant had no idea how to handle the transition and it took him a mountain of time and was going to be around $18k in fees. We had a severe chat and that bill dropped to around $8k, which was still exorbitant.

I then found The Practice. They are an accounting firm in Carlton who understand share trading and its intricacies, as they are traders themselves. As I said, our bill for 07 - 08 was not far off $5k.

My brother in law and sister own a construction company in Canberra. They employ around 50 people and handle much of the government contracts for upgrade of schools etc. They have payroll and super to handle with the company. They are also both active investors, owning half a dozen rental properties, some managed investments and trading CFD and shares online. Their tax bill last years was not quite $6k.

Do some research, Annabella, as you are being fleeced big time and more than likely because your investing is not understood by this person.

It is time to move on.

By the way, the industry ombudsman is always a good place to start any complaints you may have about fees, but first speak directly to the accountant and ask for an itemised bill showing hours spent on your return. $12k is outrageous unless your affairs are so convoluted and involved, like perhaps if we were talking multimillionaire.

Jason Cunningham at The Practice is very approachable. Have a word to him and see what they think they can do for you.

Regards

Shane

ps No, I do not have any involvement with The Practice. I am just a client and a pretty happy one.

[benny]

+1 to The Practice.

I found through here. Gary spoke of them. Last year was my first year using them, my first year as a 'trader'. The guy that does my books, I'm pretty sure is a junior but very enthusiastic, always double checking with a senior and calling/emailing me back. I'm in Sydney and rang around before deciding on The Practice (in Melbourne), the distance doesn't matter at all with good ole Aussie Post and emailing. I like dealing with The Practice because I speak very very layman in terms of anything to do with buying/selling shares and accounting stuff, Brenton always seems to understand what I'm trying to say.

After reviewing my situation with The Practice, I'm now setup with a more appropriate structure for trading. I feel confident that The Practice is on my side and is able to assist in all matters accounting and trading.
 
Same as Shane - I've got no association with The Practice except using them as my accountant. Just thought you'd be interested to have a chat to them.

[John Tassopoulos]

Hi Annabella,

Can I start by saying, "Ouch!"  The fee does seem quite high.

After my last year's experience, my 'lesson learnt' was for me was to use an accountant that specialises in SMSF returns.  (I am not saying anything new here as this has been mentioned in the forum a few times before.)

I ended up using Superannuation Accounting Services (www.superaccounting.com.au).  My contact there was Edmond Ong.  I found Edmond to be very helpful, competent, and professional.  My SMSF was run as purely SPA3 + hEdge.  My fee was $1,100.

Hope this helps.


Best regards,

John

[Tito]

Hi Annabella
I asked my accountant for a quote if I were to switch from esuperfund to his practice to do the accounts for my SMSF which is just SPA3 unhedged with around 250 transactions per year. I was also to prepare a spreadsheet with all the buy and sell transactions plus one with all the dividends for him. His quote came back at $2000. I have however decided to stay with esuper as they handle SPA3 trades without a problem and have been very professional and complete with my accounts for the 2 years they have prepared them. I don't have to prepare the spreadsheets and it only costs $600 per year. Unless those few warrant trades were very complicated, it seems there is something wrong with your bill.

[Annabella]

Thanks very much for the reality check guys - the replys are in line with what I suspected - my accountant can't understand this and is quite indignant with me for suggesting the fees are too high!
Cheers
Annabella

[Shane]

Hi again Annabella

I wonder if he would be open to giving you an itemised bill to view. This bill would include an itemised account of the amount of time spent on your return.

Then take all of that to another accountant to ask for a rough quote, or at least some kind of an idea of time.

I suspect he does not really understand trading and is spending far too long getting his head around things. Unfortunately, you are ending up paying for his time to get up to speed, which is unacceptable.

Maybe if he could get you a $20k return you might not be so quick to doubt.

Good luck with it

Shane

[Marc]

We use the practice for our SMSF too. Bill was under $2k. Time for you to change.