When you’re new to running an accounting firm, you may start out with the idea that there’s no such thing as a bad client. As long as they pay on time, you tell yourself, you can put up with anything. But sometimes there’s no putting up with a client’s actions, or things change as you work with them and it’s difficult to carry on. Still, it is true that paying clients are generally worth saving.
Alternatives to Ending Your Relationship
Assign a contact person. Sometimes you get a client who seems normal during the contract negotiation phase, but who then begins to monopolize your time with too much contact and overly complex demands. Their account may also grow too complicated for uninitiated people at your firm to handle without a background briefing, and that makes helping them almost impossible to do in a timely fashion. You can solve this problem fairly easily by assigning one person at your firm to be their go-to contact. This employee can get to know the client and anticipate their needs, vastly cutting back on the work that has to be done and making this high-demand client worth keeping.
Schedule a meeting. Many of the problems that arise between accountants and their clients are the result of simple misunderstandings. Projects can go astray, needs can change, and sometimes new details emerge that threaten your relationship. Say, for example, you’re under contract to audit a firm’s books on a semi-regular basis and you find out they have brought in a second auditor to double-check your work. On the surface, there’s nothing wrong with verification, but unexpectedly sharing a contract with a competitor may have you thinking about firing this uncommunicative client. Instead, consider scheduling a meeting with their representative (or, better, the firm’s owner) to express the problem. Whatever the final outcome, at least you’ve expressed your concerns and allowed the client to explain their perspective. Even if you end by separating from this client, the clear explanation of your reasons may lessen the shock and leave you both on good terms.
Renegotiate the contract. New events can render old agreements problematic. Imagine you’re in charge of tax filing for an Alberta-based oil company. They probably have a lot of equipment to depreciate, and it takes a lot of work to get it right. If the Canada Revenue Agency changes the rules for depreciating equipment, the job may take twice as long as it used to and you may have no choice but to charge this client more. Renegotiation is also a valid path if the client starts up a new business on the side or if they want to alter the schedule on which they pay you.
Sometimes It’s Best to Cut the Cord
When those options don’t work, sometimes you just have to let go. The most obvious reason to “fire” a client is to avoid an ethics violation. If, for instance, you discover that a client is embezzling money from a charity, there really isn’t an alternative to reporting your findings to the authorities and terminating your relationship. Less ominously, sometimes a client just gets too big for your firm to handle, and the best thing is to refer them to a more suitable firm and part on good terms all around.
Firing a client is rarely easy. Ideally, you should have a few practices that you can work through when a client becomes difficult. By acting decisively early on, you may be able to save your relationship and preserve a profitable contract. That said, if the relationship truly isn’t working for you, don’t be afraid to terminate it.