Discussion:Client need audited financial statements
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Discussion Forum Index --> Tax Questions --> Client need audited financial statements
| 8 March 2008 | |
| One of my new client need his financial statements to be audited because of some FHA requirements..I have done his F/S on regular basis for last few months and now he wants last year F/S audited...what should I tell him...How do I get these audited by a CPA...Should I look for yellow pages for CPA auditors or what...help | |
| 8 March 2008 | |
| tell him that as a sole practitioner, you affiliate with others who can round out your skills. and then refer the work on. maybe someone here can help you. | |
| 8 March 2008 | |
| So I can have some other CPA audit these F/S? that sounds great but how much it would cost?? I need to give him an estimate...Does the CPA has to be in Missouri as the business is based in MO?? thanks a lot for your help... | |
| 8 March 2008 | |
| Call some CPAs, get some fee quotes, and add 50% to thier fee quote. This gives you wiggle room if their actual charges end up being higher. If they manage to keep to thier quote, you can give the client a 20% discount and keep the remaining 30% profit for yourself. | |
RoyDaleOne (talk|edits) said: | 8 March 2008 |
| In Florida, there are some restriction on CPA's paying referral fee, don't know about MO. In addition, our liability on an audited financial statement is so great most CPA's will not do what we call brokered work. | |
Southparkcpa (talk|edits) said: | 8 March 2008 |
| In my practice, I no longer do audits. I was an audit manager at a big firm so it is notbecause of fear. I have 2 or 3 clients that I refer to a CPA firm that I have a relationship with. It works out well. I keep the tax work.
I explain the following to my client. An audit is a product that I do not want to sell, you do not want to buy, is used by a 3rd party and I can be sued. | |
| 8 March 2008 | |
| So the bottom line is the risk of getting sued is high so no need to take the risk...refer him to one of the CPA that do audits and let him get that audit done by himself and I just keep doing his accounting/payroll/tax work...correct? | |
| 8 March 2008 | |
| Last question: How do I look for a CPA who can audit F/S...any website... | |
Outwesttax (talk|edits) said: | 8 March 2008 |
| The board of accountancy in your state could probably help you. Calling a couple firms out of the phone book will either get you some proposals or referrals to firms that do. | |
RoyDaleOne (talk|edits) said: | 8 March 2008 |
| For what it is worth not all CPA that do audits will do FHA mortgage broker audits. The auditing standards are governmental standards. I have done a few of this type of audit, however, a local guy start doing so cheap that the profit I could make on the two audits I did was not enough to pay for the additional cost to stay current with CPE in that area. | |
Bottom Line (talk|edits) said: | 8 March 2008 |
| I do sub-work for a CPA and it's a wonderful relationship. He gives me bookkeeping, QB training and periodic F/S "look-see" work to do. I go to some of his clients offices and some I just pick up work at his office. I bring the work to the CPA and he writes me a check. When I have clients that need a CPA, I refer them to him. He charges the clients directly and I am not involved in his pricing in any way. I've referred contractors for bonds, mortgage brokers for audits, and tax returns that are over my head. When clients ask what he charges, I simply say "I have no idea" because I don't. It works because we each know that the other would not steal clients. | |
Southparkcpa (talk|edits) said: | 8 March 2008 |
| KC
How you find a CPA firm can be difficult. I would make a few calls/E mails. The problem is that an audit is EXPENSIVE and this is not your issue. I warn my clients that it is expensive and they are NOT there to really help. It in fact makes them appreciate me even more. 2 of the clients I can in fact see leaving me in a year or two. They are getting too big, too many states etc... | |
Bottom Line (talk|edits) said: | 8 March 2008 |
| Your client's problem is his choice of who he does loans for. FHA requires full audits. State of FL also requires for all mortgage brokers. I've got a guy wants to start business as a mortgage broker and FL is requiring an audit for start up business with a minimum of $25,000 cash in the bank. The CPA will make good money "auditing" a deposit of $25,000 into a new checking account. I told the client that it was EXPENSIVE and would cost thousands of dollars but he says he wants to go ahead. This is one of those that I will tell the CPA to get all his money up front and wait until the check clears before doing any work! | |
| 8 March 2008 | |
| Just recently had someone pay $800 for an audit of a new corp for a building contractors license in NC. Records existed of one initial capital deposit of $17,000. No other business done.
$800.00 dollars for nothing. | |
RoyDaleOne (talk|edits) said: | 8 March 2008 |
| Well $800.00 for nothing.
I would like it if you keep your comments about other people fees and what work they do for the fees to your self. | |
Southparkcpa (talk|edits) said: | 9 March 2008 |
| I agree with Roy, in fact any audit report even if balance sheet only should be at least $2,000. I won't do the tax return for $800.
The firm I use to refer audits , that will do an audit for a new GC, if NO P and L activity still charges $2,000 and I defend their price to my client. An audit of even a small company, if priced under $4,000 in my view is too cheap. My large client, a 12mil GC paid 24K for their audit withhout tax work. | |
Ksnoopytax (talk|edits) said: | 9 March 2008 |
| We do governmental audits at our firm and let me tell you, audits are not cheap, especially FHA audits. Look for a CPA that does some non-profit/governmental audits in your area. Put together a request for bid. You may ask around which would be your best way to find out who does them around your area. | |
Bottom Line (talk|edits) said: | 9 March 2008 |
| I agree that $800 seems VERY low. Sounds like a favor was done. | |
| 9 March 2008 | |
| Gosix has a right to his opinion, and he said it nicely enough. Take it easy, Roy. | |
| 10 March 2008 | |
| Thanks for all your comments...I will start looking for MO auditors..Google will be helpful..thanks again.. | |
