Question

(i) Prepare a Professional Fee (What is professional fee?)

Prepare a professional fee to submit to Bike Galaxy Pty Ltd. The professional fee should include a description of each task undertaken in this case study (being Parts 2 to 4) as well as the number of hours taken to complete each task.

Please use a charge-out rate of $200 per hour (exclusive of GST). Please ensure that the professional fee is placed on your group’s letterhead. Please use your firm’s letterhead to draft your professional fee on. You do not need to design a new letterhead.

You can assume that your firm is registered for the GST. The ABN of your firm is 14 901 044 418. Please date your professional fee 16 September 2020.

(4 marks)

(ii) Strategies to Communicate Complex Technical Issues to a Client

A professional advisor will often advise their clients on a range of technical accounting and tax matters. However, in many instances clients do not possess the necessary financial expertise or technical accounting or tax knowledge to completely understand the information/advice provided by the accountant.

Throughout your degree, you have acquired a range of technical and disciplinary skills that will serve you well when advising clients. These clients will come from a variety of backgrounds and, in some cases, will not understand the ‘language and terminology’ that you would ordinarily use to explain (at times) complex technical accounting and taxation concepts.

Required:

Identify and explain three (3) strategies that you would adopt to simplify the content being delivered to clients.

In other words, what strategies could you implement to simplify the financial advice provided to a client (like David and Jake) where they readily admit that they lack the necessary financial acumen to understand what you are saying?

(6 marks)

Answer 1

(i) Professional fees :

Professional fees are prices charged by individuals specially trained in specific fields of arts and sciences, such as doctors, architects, lawyers, and accountants.

Professional fees is a revenue account. It is presented in the first part of the income statement under revenues.

Professional fees includes consideration for :

a) managerial

b) consultancy

c) technical ( if there )

d) Provision of service

(ii) Strategies that could simply the financial advice for clients:

1) Keep it simple , use 'common sense ' financials : Use less jargon ( jargon are special words or expressions used by a profession or group that are difficult for others to understand ) incorporating in user friendly approach and easy terms will help them understand financials.

2) Bring your financials to life : Using images and words instead of numbers where possible. Try to communicate in an interesting and understandable manner.

3) make the data directly assessible for clients : Prepare / present the summay of financials in a way which is easily and directly assessible for clients.