Industry
Accountants for professional services firms
Consultancies, agencies and practices — utilisation, work in progress, partner drawings and extraction.
Overview
Your sector, in practice
In a professional services firm the product is time, and the accounting question is always the same: how much of the available time was chargeable, at what rate, and how much of it actually got billed and collected.
We work with consultants, agencies, surveyors, solicitors, healthcare practices and other advisory businesses in the Scunthorpe area, whether trading as companies, partnerships or LLPs.
Challenges
What makes this sector different
Utilisation and recovery
Chargeable hours delivered are one number; hours actually billed and paid are another, and the gap is where the profit goes.
Work in progress
Unbilled time is an asset at year end, and valuing it affects both reported profit and the tax payable.
Partner and director drawings
Drawings taken monthly against profit that has not yet been earned or collected create real cash strain.
Fee pressure
Rates set years ago rarely track salary inflation, and reviewing them is repeatedly deferred.
Tax and accounting
Key considerations
Structure
Company, partnership or LLP each affects tax, liability, profit sharing and the ease of bringing in new partners.
Revenue recognition
Fixed fee, retainer and time-based work are recognised differently and need a consistent policy.
Professional indemnity and provisions
Insurance and any known claims should be reflected correctly in the accounts.
Reserving for partner tax
A tax reserve account prevents January from being a recurring crisis.
How we help
Our work for these businesses
- Management accounts with utilisation and recovery reporting
- WIP and revenue recognition policies at year end
- Partnership and LLP accounts with profit allocation
- Partner and director Self Assessment returns
- Drawings and tax reserve planning
- Fee structure and pricing reviews
Watch out
Common mistakes we see
- Billing in arrears with no interim invoicing on long assignments
- Writing off unbilled time without ever analysing why
- Drawing profit that has been earned but not yet collected
- Recognising fixed-fee income before the work is delivered
- Leaving charge-out rates unchanged while salaries rise
FAQs
Professional Services questions
At the value of the service delivered where the outcome can be measured reliably, having deducted anything unlikely to be recovered. A consistent, evidenced policy matters more than the precise method.
Enquire
Tell us about your business
A short conversation is usually enough for us to tell you whether we can improve on what you have now.
Related services
Services that work alongside this
- AccountingA complete accounting relationship: statutory compliance, regular reporting and someone to ring before you make a decision.
- Management AccountsMonthly or quarterly reporting that shows margin, cash and tax exposure while you can still do something about them.
- Self Assessment Tax ReturnsReturns prepared and filed for sole traders, directors, landlords and higher earners — early, accurate and with the reliefs claimed.
- Business AdvisoryPractical commercial support: forecasting, funding, pricing, growth planning and preparing a business for sale or succession.
Related industries
Businesses we work with
- LandlordsRental accounts, the finance cost restriction, allowable expenses and disposal planning for property investors.
- Limited CompaniesEverything a Scunthorpe limited company needs — accounts, tax, payroll, VAT and director planning in one place.
- Sole TradersSimple, affordable support for the self employed — accounts, tax returns and honest advice on going limited.
- EcommerceMarketplace reconciliation, VAT on online sales, stock valuation and true profit by channel.