Your 3 options when clients need more help than you can provide yourself

Jul 21, 2020 | Client service, Professional Negligence

Imagine you’ve gone to buy a second hand car and, after checking it has all the features you want, you agree the price you’ll pay with the vendor. You are thrilled. They promise to give it a clean and bring it around to your house a couple of days later.  That’s all part of the service and covered by the fee you’ve agreed to pay.

When they bring the car round though, they tell you that they spotted something that might have been a problem so they arranged for the car to have an independent AA check. This confirmed there was no serious problem and should give you more confidence that all is well. The extra cost of this service was £1500 and you need to pay this on top of the amount you’ve previously agreed to pay for the car.

How good would you feel about the vendor’s care and concern for you and your new car? Would your reaction be:

  • “How thoughtful. I can see how that extra service gives me more peace of mind and shows how much the vendor wanted to go above and beyond just selling the car.” or
  • “How dare they? Even if I believe there is some value to me in that extra service I’m annoyed they didn’t talk to me about it first. And I’m not happy to pay it either. I didn’t agree to it when we discussed the price.”

Maybe you think the salesperson could have done the full check themselves. Indeed perhaps you would have expected them to be able to do this. Or maybe they always outsource this sort of thing as their customers don’t care who does the check, just so long as it is done properly. Or maybe they should have simply advised you to have the check done yourself.

Now let’s bring this back to the work you do for clients.

We all know that most clients don’t like surprise extra fees. Even if you’ve done some excellent additional work, clients want to know about this before you commit them to paying more.

Maybe some of your clients follow the ‘How thoughtful’ train of thought. But do not make the mistake of assuming this is the case, just because they’ve not said anything. They may just be marking time until they can find someone more reliable and trustworthy.

A similar point arises when a client presents a challenge, issue or problem that means you need outside help. When this happens you have 3 choices:

– Engage a specialist to help you and then tell the client;
– Advise the client that YOU will need to check things with a specialist; or
– Advise the client THEY will need to engage a specialist – and you can recommend one.

Over the years I have worked with accountants who have followed each of these paths. And they each have their pros and cons:

Engage a specialist to help you

Pros – Client may think you know more than you do. You may feel this makes it more likely they will stay a client and recommend you to other people.

Cons – Client may think you know more than you do! You risk being found out later. You will be primarily liable for the specialist’s fees and may have no way to recover them from your client. You will also need to have authority via your engagement letter to to share client data with third party contractors or to outsource the services you offer clients. It applies equally whether you use self employed bookkeepers, an outsourcing company or you are engaging specialist tax support.

Advise the client that you will need to refer to a specialist

Pros – Client will know they can trust you to admit what you don’t know. This can be a powerful way to build trust and to retain clients who recommend you to other people. You reduce the risk of doing work and incurring costs that you cannot recover from the client.

Cons – You have to explain the value the specialist will deliver and justify their fees. Client may prefer to source their own expert – at a lower cost.

Advise the client THEY will need to engage a specialist

Pros – You avoid any risk of doing work and incurring costs that you cannot recover from the client. You can get the specialist’s help to explain the value they deliver when justifying their fees. And client will know they can trust you to admit what you don’t know. This can be a powerful way to build trust and to retain clients who recommend you to other people. You avoid any risk of doing work and incurring costs that you cannot recover from the client.

Cons – Client may prefer to source their own expert – at a lower cost. [In practice, where clients trust their accountants they will rarely want to go and find their own specialist adviser – if the accountant is able to recommend one they already know].

I first encountered these 3 options when I ran the Tax Support for Professionals team at WJB Chiltern in 2001.

Accountants still have to make the same choices now when they want support from members of my Tax Advice Network. Some engage specialists to support their accountancy practice, across a range of clients, others engage specialists on one-off cases, and others refer their clients to a specific member as and when required. This is often the right choice for tax investigations related work and also when the fee is likely to be large – as it saves you having to negotiate this with your client.

There is a 4th option of course. That is to attempt to stumble along without external help and advice. When you do this though you risk giving your clients duff advice, breaching the terms of your PI policy and also the PCRT. This can put at risk your client relationships, your future and your career.

My advice here was always to imagine the person who needs your advice is a close family member or close friend. Would you be happy for them to act on the basis of your advice – without you or they checking it with an expert. If the answer is ‘no’ then you or they should check with an expert!

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