Friday, 26 June 2009

Mark Lee on timesheets

Mark Lee's latest blog post talks about how accountants often do more networking with new and potential new clients than with existing clients - because time spent with existing clients has to go down on the timesheet and therefore has to go down on the bill. Networking meetings, on the other hand, can't be billed.

I've encountered that accountant mentality before now. I knew one accountant who billed his client for time spent at a social lunch. Yuk (that's the accountant's attitude, not the food).

David Winch
comments to Mark's post;

What else could you do to reduce the downsides of your timesheet procedures?

Bin them!

I agree with David! My new practice has no timesheets (though when I do subcontract work for other accountants, I do a mixture of hourly rates and fixed fees).

If I were a client, I wouldn't want to wait a whole year before I knew what my accountant was going to charge me, and have no option to say "No thank you, that's too expensive" before (s)he did the work.

When you take your car in to be serviced, don't you like the garage owner to tell you upfront how much a standard service will cost?

If you send your children to private school (OK, I know that's a red rag issue for some people), how would you like it if the school charged more the longer it took to explain a problem to your child?

Filling in a timesheet is a job I always hated, and now I get to choose, I do as little of it as I can!

To quote Hugh Williams:
When accountants and solicitors charge by the hour
Clients moan about fees and relationships sour
So throw away timesheets - Fix Price all you do
Bill 'em upfront and clients will love you!


  1. I fully agree. Since I left my job in practice I vowed never to use timesheets again and haven't!

    I quote a fixed price upfront and the risk (and reward) is all mine.

    Scrap the timesheets!

  2. Thanks for the mention M

    Another convert! I'm hoping to convert more people on July 7th

    Hourly billing is really just providing day-care for grown-ups!

  3. I've worked in a practice which ran without timesheets and one which made heavy use of them.

    On balance, I'm in favour. They are a hassle to maintain but they make you work more efficiently. They focus your attention on turning down unprofitable jobs. They put the onus on practice management to avoid giving you non-chargeable assignments like IT support, admin and training.

    The analogy with a standard car service doesn't hold since with a lot of new work you can't tell how much surgery is needed until you get right into it. In subsequent years you essentially offer a fixed fee even if you're ostensibly billing on the basis of time.

    If it takes you longer than expected to deliver the work next year due to your own inefficiency, you take the hit. The client would only get billed extra if they've screwed things up at their end or they want extra work done.

    I haven't seen many examples of timesheets discouraging you from networking with existing clients. Most client communications tend to relate to ongoing assignments and you naturally find out about extra work opportunities in the course of this. If clients trust you, they will will bring referrals around without you having to do much legwork.

    Timesheets might discourage networking with potential clients since the time isn't chargeable but I haven't met a partner dumb enough to think meeting new contacts is a waste of practice resources.

  4. Thanks all for your comments.

    @David: I really like the option you give your workshop customers of paying what they think the workshop is worth! Wow!

    @Ali: Fair points - but could I ask how accurately the timesheets were completed? Unless they were done minute by minute, there would surely be a certain amount of "fudging" going on? And if they're done minute by minute, how do you record "timesheet time"?


  5. I wouldn't think the fudging would have a significant impact on results. Getting minute-by-minute detail would be counter-productive if you're trying to foster efficient working habits.

  6. New post:


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