I have recently passed my ICB Level II in Manual Book Keeping and have begun the process of setting up from home. Got insurance, practice licence and seeing HMRC next week to deal with my MLR and any other tax issues.
I have begun writing a business plan so I have an idea what I want from the business and myself. As with all business plans they ask for estimated turnovers, products and services. I still thinking on the services I will offer but I was wondering how you calculate your hourly/monthly pay from clients. The handbook I got from the ICB say charger £15-20 an hour to start with and with experience and establishment charge £25.
Pricing can be a real pain in the bum. I'm planning on starting out as part-time then slowly work into a full-time schedule, get to know the ropes rather than jumping in the deep end. I am currently working 10 hours with a cleaning company, so I will still have some wages for my mortgage so I won't be taking much from the business in the first 6-months to a year. Want to get it established and get some realistic money into it.
you say that you've got your practice licence. I assume from the ICB.
Note that this means that you are covered for MLR via ICB membership and you do not have to register for it directly with HMRC (so there's £170 you've just saved!).
The ICB lie through there teeth to get people to join up. In reality expect to be making around £7 to £12 per hour and don't expect people to be beating your door down to give you work.
Its really good that your holding onto your other job. With time you will build up a client base but it does take time.
You need to be thinking about networking to gather clients. Have a read of some of Robs threads as he does give some excellent advice re networking events.
I'm sure that your not going to believe what I'm telling you after what you've been fed by the ICB and your training provider but it is true non the less.
Good luck with your new business venture and I really hope that it works out for you. There are some good rates to be had out there but clients tend to expect a cheap accountant rather than a bookkeeper in order to achieve them and at ICB level II your not going to be in a position to offer the full range of services yet.
Any specific help you need just post on here and we'll do our best to help out,
good luck,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
welcome to the forum. You will find several threads on here re: pricing and it seems to vary a lot, not necessarily due to location so you should have a good read of them, they will hopefully help you a lot.
You will be restricted on what services you are allowed to offer at level II, I think you can only do bookkeeping up to trial balance and sadly this is probably the lower end of the price range.
You will probably need to get some experience if you haven't already? Doing some voluntary bookkeeping work for local community ventures may help there and also may aid in networking. I am finding this is helping me to get my name out there and it hasn't cost me a penny. Advertising does not seem to work so well in this line of business but some people will beg to differ.
Quite a few of us on here like to charge on a fixed monthly amount. I generally find this helps with the hourly rate and also will help with your cashflow budgeting. I tend to start at £50 per month for vat registered traders. Of course if you get a non vat trader giving you a bag of receipts etc for the full 12 months you will struggle to charge £600 for the bookkeeping, so you will need to charge realistically, and to be honest it is probably less than a days work for something like that so if you managed to charged £100 you are still on a reasonable hourly rate. Are you competent at doing tax returns? If you are (and you have to be confident that you can do this for a smaller trader), then you can obviously add a bit on the top!
as Shaun says there are quite a few threads on here about networking and ways to bring in clients and also a fair few on pricing, or at least they start that way until the Amigos and the Amiga go off track!
I believe things are looking up at the moment so hopefully you will be able to bring a few clients in but you do have to get out and about and get known!
Thanks all for the advice. I had a feeling the ICB price was not 100% correct, even in this recession and thanks for the information on MLR. I have purchased the practice license from the ICB so as you say £170 saved. I will be a regular on here as I will need all the help.
The items I can do are VAT Returns (which is pretty easy if you have the information in front of you; well I found it easy in my assignments) I love doing reconciliations as well as double entry of course. Trial Balance too, which I find fairly easy unless I hit a problem and my already balding head loses more hair. Now credit control can be a bit more tough for me, but I think with enough practice I can master it.
I assume as a level II ICB I can do Trading, Profit & Loss and Balance Sheets? I know I can only deal with sole-traders so the big boys will have to wait until I graduate to level III, whenever that will be.
-- Edited by Adam Westwood on Thursday 25th of March 2010 08:26:10 PM
You may find VAT returns not quite so simple as in assignments. For a start the VAT rules themselves are quite complex, just take a look at some of the posts on here about various aspects.
Do you do have experience of accounting software? You may find even the smallest customers these days use it and it saves an awful lot of time.
some of the debates where yourself, Bill, Phillip and I have become embroiled in the technicalities of VAT would make excellent reading for Adam.
Adams right, with his ICB lvl II he's allowed to do P&L and B/S's. Can't believe that I'm still only allowed to go to trial balance!
Well, if I keep studying hard I'm sure that I'll get there eventually.
Have a good one and talk soon,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Now to the off-topic. The people haven't responded to my solicitor yet so things are moving slowly. Leg is much better but scab not yet come off. She wants another photo when it does of the scar - I'll need my son's sooper dooper camera to do that rather than my 5 megapixel!!!
Adam's enthusiasm in his responses is a breath of fresh air and is almost infectious.
Really wish him all the best but I just know that he's in for a bit of a shock!
Hows life with you Matey? When is your next exam now? When are you coming over to the dark side to study ACCA / CIMA???
Actually, truth be told, the time it takes and the restrictions that are slapped on you I really wouldn't bother. If I knew six years ago what I know now I would have gone down the AAT path.
Love the ACCA syllabus (well, except group cash flow statements and hedging) and really enjoy the challenge of the exams. But the restrictions on what you can do are draconian in the extreme.
Anyway, I've got study fatigue. Keep reading but nothing is going in. Must be that all of the little grey cells are full and I just don't have the number that I need for this next one.... Actually, thats probably not true. It does all go in there but my brains indexing system is just shot to shreds. (As evidenced by the way that it doesn't seem to group jokes and punchlines together).
I took on board what you said about bullet points. In the examiners report for the advanced papers they state that they don't like to see bullet points then in the examiners answers to the last sitting what do we see... Yep, you guessed it. Bullet points!
Anyway, have a good one matey and talk later,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Thanks again all. Advice accepted. As Shamus said "I'm in for a bit of a shock" but then that's how they all sucker us in the world - tell you one thing and do another. I have looked at accountancy software and I quite like Solar Accounts; it's simple. But as I'm only a Manual Book Keeper the finals have to be in ink. It will be hard to start with but I think once I've got the hang of it I'll be okay.
. Maybe I should specialise 
.
