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Intuit 2006 Rates Survey

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Bookkeepers and accountants are always interested in knowing what their colleagues charge. Our exclusive national straw poll for 2006 gives you plenty to consider. We show real upward pressures on rates for general bookkeeping and other hourly services over the previous year. Among fixed fee services, the average cost of installation and setup went down; other fixed fee services went up.

Background

In November and the early weeks of December 2005, Intuit® ProConnection® conducted a survey of its readers to identify what rates are being charged for selected bookkeeping and bookkeeping-related services.

For this article we will look at the national perspective on both hourly rates and fixed fees in categories typically offered by practitioners.

Thanks for Your Response

First, thanks again to readers who responded to this survey. Over 350 of you responded, and we are contacting the three lucky winners of the 2G iPod nanos. (We will publish the names of the winners soon.) This number is significantly higher than last year, and almost as many as the year before. We are grateful for your response.

How to Use These Numbers

Our survey is an unscientific straw poll that relies upon the honesty of our readers. We believe the results are significant, and you can certainly use them to determine if you need to reconsider your rates structure.

Wide Range

For most hourly rates, the highest rate is 16 times higher than the lowest rate; in at least one fixed fee category, the high rate is 60 times higher than the low rate. Because of the wide range of markets in the United States, those extremes may be appropriate.

Who Replied

Seniority; Client Base Size. In a later story we will discuss geographical distribution of these results, but for now we can say that the practitioners and firms represented have significant history in the industry and a sizable client base. The average respondent has been offering services for 15 years. The average client count per firm is 244.

Hourly Rates vs. Fixed Fees. Most respondents-nine out of ten–tell us they charge all or some of their services by hourly rate. (We know that some charge both, and a third of the respondents charge at least some services by fixed fee.)

QuickBooks® Users

Not all respondents use QuickBooks Financial Software to support or prepare their client records, although a majority does. All but about two percent of respondents support at least a portion of their clients on QuickBooks, and on average the respondents are supporting three out of four of their clients on QuickBooks.

Hourly Rates – A National Picture

Again this year we asked practitioners what rates they charged in

• General Bookkeeping
• Training
• Software Installation and Setup
• Generating Reports
• Troubleshooting
• On-site Maintenance
• Telephone Consulting
• Non-software Business Consulting.

In last year's survey, $50 was the popular hourly rate to charge, both as average and median. This year the average is $60. Most all other categories were significantly higher. (The $50 average held in surveys in 2005 and 2004.)

General Bookkeeping

Note: Unless otherwise stated, at last 90% of the hourly respondents offered the services shown below, which we list in order of popularity.

General bookkeeping was the most common hourly activity of those identified, with all but one respondent who charged hourly rates offering this service.

Software Installation/Setup

Software installation and setup almost ties with general bookkeeping, representing 97% of the respondents who charge hourly rates.

Training

The next most common hourly activity is training, with 95% of the hourly respondents active.

Non-software Business Consulting

In another change from last year, the percentage of practitioners offering business consulting services increased significantly, from 76% last year to 94% this year.

Troubleshooting

Troubleshooting is next most popular, representing 92% of hourly respondents, also a big increase from last year (when the figure was 83%).

Generating Reports

Close on the heels of software installation and training is the generation of reports. About 92% of practitioners who charge by the hour are active in this category, compared to 89% last year.

On-site Maintenance

Tying with generating reports is maintenance, also at 92%.

Telephone Consulting

Fewer respondents charge for telephone consulting than any other category. From optional comments from some respondents, it appears that some practitioners don't charge for spending time on the telephone with clients, either because they want to maintain good will or because they have factored in the likely aggregate costs into their pricing for other categories. Obviously it is a tactical decision for the practitioner as to when to escalate a telephone call into a separate engagement.

Almost 80% of respondents charging hourly rates also charge for telephone consulting on an hourly basis. This is a big increase from about 69% last year.

Fixed Fees – A National Picture

How many practitioner charge fixed fees for selected services? At least a third of respondents had some charges based on fixed fees. Responding to categories provided by Intuit, practitioners shared their fees for the following services:

• Installation and Setup (New User)
• Quarterly Tune-Up
• Personal training (1–2 hrs.)
• Personal training (3–4 hrs.)
• Personal training (full day)

Of the nearly 100 respondents who qualified for this section of our survey, their distribution across these services is as follows:

These ratios are significantly higher from the ratios uncovered in 2005.

Installation and Setup for New Users

Installation and setup services are most popular of fixed fee services, with all of the practitioners who offer fixed fees offering services in this category.

Quarterly Tune-Up

About 88% of fixed fee practitioners offer quarterly tune-up services on a fixed-fee basis.

Personal Training (1-2 Hrs.)

Training services were the next most popular category, with minor variation based on the length of the training. The categories of 1–2 hours, 3–4 hours, or full-day training have been used by Intuit in its last two surveys, and as before, the shorter the period of training, the more likely it will be offered by the relevant category of practitioners.

Thus 86% offer personal training at one to two hours in duration.

Personal Training (3–4 Hrs.)

When it comes to the next longer category, 86% of fixed-fee practitioners offer such training.

Personal Training (Full Day)

Almost as many practitioners, at 83%, offer day-long training on a fixed-fee basis, as with the next closest category.

Bill Teague is Managing Editor of the Intuit ProConnection newsletter and Web site. For many years he was an Editor and Associate Publisher at Harcourt Professional Publishing, which published CPA Digest, Tax Accountants Weekly, and other publications for accountants.

Last Updated: 01/26/2006