Episode 71: Handling Past Due Books: Setting Expectations, Additional Pricing, and Client Communication

Jun 26

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Conquering Workflows & Systems for Bookkeepers & Accountants podcast with Alyssa Lang, founder of Workflow Queen and Magnetic Bookkeeping & Consulting. Episode topic: Handling Past Due Books: Setting Expectations, Additional Pricing, and Client Communication

In this solo episode, Alyssa Lang covers a question that was submitted by @vautourgroupllc_accounting on our Instagram account. The question they submitted was, “How do you handle the process to later catch up past months books once you do get the information? What are the expectations, additional pricing and do you resend the financial statements?”

In this episode you’ll hear:

How to evaluate the ways you request information from clients
What expectations to set in place with your clients on ensuring information gets to you in a timely manner
What additional pricing to layer into your services for past due information
What to do with the financial statements from the past that need to be fixed

Resources mentioned in this episode:

⚙️ Keeper

⚙️ Xenett

💻 Breakthrough for Bookkeepers & Accountants

👩🏼‍⚖️ Linsey Shae Consulting (lawyer I use and recommend) - use code WFQ10 for 10% off services and templates

📄 Bookkeeper Legal Template which provides 4 different services - use code WFQ10 for 10% off

📄 Bookkeeper Bundle Agreement which includes the Referral partnership agreement, Independent Contract Agreement, Website policies, and an NDA - use code WFQ10 for 10% off

⚙️ Content Snare

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In today’s post, we’re diving into a question from Vautour Group LLC Accounting (@vautourgroupllc_accounting) on our Instagram (@workflowqueen). They asked, "How do you handle catching up on past months' books once you get the information from clients? What are some expectations and additional pricing strategies?" Awesome question! Let's get into it.

Evaluating Your Information Request Process

First things first, let’s talk about how you’re asking your clients for information. Are your emails too long and overwhelming? Are you sending too many reminders? Consider tools like Content Snare or Keeper to streamline your requests. But don’t overdo it with weekly reminders; it might just annoy your clients into ignoring your emails. Find that sweet spot where your requests are clear, concise, and spaced out enough to be effective.

Here’s a personal story: We had a client who constantly ignored our information requests. It turned out our emails were too detailed and looked daunting. We switched to shorter, more focused requests using Content Snare, and their response rate improved dramatically. Sometimes, a small tweak can make a huge difference!

Setting Clear Expectations with Clients

Setting expectations is crucial. When onboarding a new client, make sure they understand the importance of timely information submission. Explain how delayed information can impact their financial reports, like scrambling for accurate financials when trying to secure a loan. Paint a picture of the potential consequences to drive the point home. Remember, it’s not just about you; it’s about their financial well-being.

In my firm, we set the tone during the initial consultation. I tell clients, “If you don’t get us the information we need, your financials won’t be accurate, and this could impact important decisions like buying a house or getting a loan.” It’s so important they understand the real-world implications.

Implementing Additional Pricing for Late Information

Now, let’s talk money. What do you do when clients don’t get you the info you need on time? In my firm, we charge an additional fee if a client is more than two months behind in providing necessary information. This is clearly outlined in our contract, drafted by a professional (shoutout to Linsey Shae Consulting - use code WFQ10 for 10% off services and templates!). If we have to go back and clean up old data, we bill an hourly rate. This not only compensates us for our time but also encourages clients to stay on top of their submissions.

Here’s how we do it:

Define the Threshold: Set a clear number of months after which additional fees kick in (e.g., two months).
Hourly Rate: Charge an hourly rate for any backlogged work. Our rate is between $90 and $110 per hour.
Contract Clarity: Make sure this is clearly stated in your contract and remind clients as needed.

For contracts and agreements, I highly recommend the Bookkeeper Legal Template (use code WFQ10 for 10% off) and the Bookkeeper Bundle Agreement which includes the Referral Partnership Agreement, Independent Contractor Agreement, Website Policies, and an NDA (use code WFQ10 for 10% off).

Handling Financial Statements from the Past

Lastly, should you resend financial statements once you receive the missing info? Short answer: no, unless the client specifically requests it. Here’s our process: at the end of each month, we close the books with whatever information we have. If something is missing, we note this in the financial statements and in our email to the client. We remind them that the reports aren’t fully accurate due to the missing data and inform them of the additional charges if the delay extends beyond two months.

Here’s how we handle it:

Issue Preliminary Statements: Close out the month with the information you have and issue preliminary statements.
Communicate Clearly: Inform the client that the statements are not fully accurate due to missing information.
Charge for Revisions: Only revise and resend statements if the client requests it and charge accordingly for the additional work.

Tools of the Trade

We couldn’t do our jobs without some trusty tools. Content Snare makes our information requests a breeze, and WhyHR helps us stay compliant with all the HR and payroll regulations. And, of course, we swear by Clockify for tracking our time accurately. These tools not only keep us organized but also makes sure we’re delivering top-notch service to our clients!

Conclusion

To wrap it up, handling backlogged books is all about setting clear expectations, streamlining your request process, implementing additional pricing for late submissions, and deciding when to resend financial statements. With these strategies, you can manage your workload more effectively and keep your clients on track!

Got more questions or need further advice? Hit us up on Instagram (@workflowqueen) or email us at support@workflowqueen.com. We love hearing from you and helping you tackle your bookkeeping challenges.

Happy accounting!

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