Setting up an Accountancy Practice

MarGar

Hi everyone,

I am giving serious though to setting up my own accountnacy practice. Could anyone who has set one up in the past couple of years let me know the pitfalls, advantages/disadvntages. The main piece of advise I would be grateful for is how people got their clients especially the first couple.

Looking forward to hearing from everyone
Thanks

capefear

http://www.askaboutmoney.com/threads/accountant-practice-set-up-from-zero.196881/

Have a look at the attached link for some good info

Gard1

MarGar wrote: »

Hi everyone,

I am giving serious though to setting up my own accountnacy practice. Could anyone who has set one up in the past couple of years let me know the pitfalls, advantages/disadvntages. The main piece of advise I would be grateful for is how people got their clients especially the first couple.

Looking forward to hearing from everyone
Thanks

Setting up as a sole practitioner isn't an easy task unless you already have a reasonable client base to start with. If you intend to open without a couple of good regular clients who pay you monthly you will go hungry. Best option is to buy a block of fees (which can be hard to find ) or find an existing practice who's principle is considering retiring. Either of these can be expensive options but you won't be sitting down waiting for people to come to you! Then you have the great task of collecting money for your services. Some of them will keep you waiting. There are advantages to having your own practice but there will be long hours and at times little reward. Best of luck whatever you decide!

MarGar

Thanks guys,

Good advice. Would love to hear from people who set up an accountancy practice without any client starting. How long did it take to build it up? What was the best way of getting new clients? Advertising? Website? Networking?

Thanks

kennyb3

What's your current role and previous experience in practice? I think that's essential for anyone looking to give you advice.

MarGar

I am currently working in a small practice. There's five people working there and I'm the senior accountant. I have ten years experience working in practice and four post qualification.

kennyb3

MarGar wrote: »

I am currently working in a small practice. There's five people working there and I'm the senior accountant. I have ten years experience working in practice and four post qualification.

That's good so you basically know what's involved. What are your main questions?

I'm not sure if you are chartered but their 'Going into practice' course is very useful. There are also practice management courses run by omni pro. They will give you a flavour of it.

As to how/whether it will be a success ; Either your going to be taking a portfolio of clients with you or you'll need to start from scratch. If starting from scratch you're probably looking at combining your current role and building a portfolio at nights/weekends.

If you just leave your current role and have no clients so to speak your probably looking at 12-18months+ to get anywhere and then you've WIP + money to chase.

I'd say you know the main advantages and pitfalls - either it goes really well and you're your own boss with unlimited earning potential or you struggle and wish you had a salaried job instead and plenty in between.

A lot will depend on your personality, your networking skills and how much you really understand about the practice you are in (stuff like CARB monitoring vists (assuming you intend to audit) and how to deal with them etc.)

MarGar

Thanks guys, gerat help. I'm not going to take on the audit certifictae yet just the practice certificate. Maybe down the road I might consider audit.

Just one other question, if applying for a start-up loan what institute is best? Does anyone have any experience of this?

gabbytheking

Hi Kennyb,

I'm starting out in January. I was wondering with hard work advertising and some investment in Marketing and networking how long did it take you to build up a 50k fee base which I view as a milestone to be self sufficient and will cover direct costs and a reasonable amount of drawings. Would I build 50k up in 12 months do you think? I have an approximate Working capital to keep us going for 6 months or so in savings. My location is a town within an hour of Port Laois, Nenagh, Roscrea, Limerick, Birr Tullamore etc

I'm also left with a situation where I have to apply for an auditing certificate straight away as they review your last 4 years exp and require 2 years of good quality exp. I worked at a high level in Audit but that is just over 2 years ago. P.S. I think this is unfair but the way ICAI work to get in fees IMO. I think if you don't have an auditing certificate in future years you will have to turn down good jobs such as solicitors etc and be left without it.

I would be interested in talking with you if you wouldn't mind. I think if it goes wrong I've always been in practice and might struggle to get jobs in Practice after going out. Any feedback in this regard?

Gard1

gabbytheking wrote: »

Hi Kennyb,

I'm starting out in January. I was wondering with hard work advertising and some investment in Marketing and networking how long did it take you to build up a 50k fee base which I view as a milestone to be self sufficient and will cover direct costs and a reasonable amount of drawings. Would I build 50k up in 12 months do you think? I have an approximate Working capital to keep us going for 6 months or so in savings. My location is a town within an hour of Port Laois, Nenagh, Roscrea, Limerick, Birr Tullamore etc

I'm also left with a situation where I have to apply for an auditing certificate straight away as they review your last 4 years exp and require 2 years of good quality exp. I worked at a high level in Audit but that is just over 2 years ago. P.S. I think this is unfair but the way ICAI work to get in fees IMO. I think if you don't have an auditing certificate in future years you will have to turn down good jobs such as solicitors etc and be left without it.

I would be interested in talking with you if you wouldn't mind. I think if it goes wrong I've always been in practice and might struggle to get jobs in Practice after going out. Any feedback in this regard?

iCAI recommend having 18 months to 2 years office and living expenses in working capital prior to venturing out. I started out part time and built my client list slowly until I had enough to go full time. I invested 6k the first year I went full time in radio and newspaper advertising - I got no return - not one client. Admittedly I've grown my business through a recession so growth has been slow. You also have to think of the client you may be attracting. Most people have a relationship with their accountant and the most thing that causes this to sour is fees. Either price is considered too high or they are slow to pay. This is one reason people move. Do you want someone else's bad debt or have to undercut fees and end up working for nothing?
Word of mouth is the cheapest and best form of advertising. Your reputation will bring you in business.
As regards the auditing cert, it's going to cost you 5k to get it with extra pii etc. A lot of companies needing an audit will go to the big guns -
Unless you are bringing 20k of fees with you from your current job I would look to take a slightly different approach. Maybe get a fc role part time which you can live on while waiting for the clients to increase
Best of luck in your endeavours

exaisle

MarGar wrote: »

The main piece of advise I would be grateful for is how people got their clients especially the first couple.

They poach them from their employer!

exaisle

Gard1 wrote: »

Word of mouth is the cheapest and best form of advertising. Your reputation will bring you in business.

Absolutely spot on, sir!