Conquering Workflows & Systems For Bookkeepers & Accountants | with Alyssa Lang (Workflow Queen)

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

• Alyssa Lang • Season 1 • Episode 71

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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

Thanks for listening. If this episode inspired you in some way, take a screenshot of you listening on your device and post it to your Instagram stories and tag me, @workflowqueen

For more information about the Conquering Workflows & Systems for Bookkeepers & Accountants Podcast or interest in our programs or mentoring visit our resources below:

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So in today's episode, I'm actually going to be sharing a question that was submitted on our Instagram, which is at workflow queen. And this was actually submitted from Via Tour Group LLC Accounting. Thank you so much for submitting this question. I really appreciate when you guys reach out and ask some juicy questions that become really great topics for me to really deep dive into on the podcast. So her question was, how do you handle the process to later catch up on past? Months books. Once you do get that information from the clients, what are some of those expectations, the additional pricing that you might layer in. And do you resend the financial statements once the client has sent you the information that you've been missing? So, this is such an incredible topic to talk about. And so I got really excited to record this episode today. And so I'm going to be deep diving into ways that you can reevaluate how you're trying to request information from your clients. We're gonna talk about what those expectations are that you need to set into stone with your clients to make sure that they know and others understand how important it is to get accurate information to you guys on time. We're also going to talk about what it looks like. And how we do additional pricing that we layer into our contract and into our services. When our client gets us a certain number of months behind information to us to finally adjust it in the books. And then I'm also going to be deep diving into whether we actually resend the financial statements or not. once we received the information. So without further ado, grab a pen and paper. There's a lot of great information here and today's episode. I can't wait for you to dive in and thank you to everyone. Who's been submitting questions on our Instagram. Or if you have something that you're dying for me to talk about, please go to support@workflowqueen.com and I am more than happy to read through what you guys want me to talk about and see if it's something that I can make happen for you guys. I'm stoked for today's episode because I did something a little different on picking the topic for today's episode. So what I did was I actually went to our Instagram, which is @workflowqueen on Instagram. And I pretty much just reached out to you guys and I asked you, what do you guys want to hear me talk about here on the podcast? And so I just want to kind of preface and start with whenever feeling like you don't know what content or what things to talk about, just ask your audience. You'd be really surprised how much your clients or your prospects or the people who are following you want to know or hear what you have to say about specific topics. So if you're like me and you get stumped, which even for myself, I get stumped all the time on what. Type of content or questions. People want me to answer. I just simply ask. So what I did was I posted on my Instagram and I just said, what topics do you guys want to hear? On the podcast and I've got a really good submission. And I am going to kind of butcher this username, but it's, I believe Via Tour Group LLC Accounting. Is the one who submitted this question. So thank you so much for somebody in this question, because it's such a great topic to kind of dive in today. And I'm just going to go all in. So the question that they had posted to our Instagram was how do you handle the process to later catch up past month's books? Once you do get the information from your clients, what are the expectations you set the additional pricing? And do you send the financial statements again? This is such an amazing question, because I feel like I hear this a lot. In the space of like, what do I do if they're not doing this? Like, and so to simply put this and I'm going to really deep dive into three core parts because I really want to break apart. The parts of the question. So I'm going to start off with what are the expectations. So I'm gonna talk about the expectations that you need to be setting with your clients when they're not getting the information. Talking about the additional pricing. So I'll talk about even what we have in place on my contracts. And then also do we resend those financial statements? I'm going to break it up into three different parts. But just to simplify this episode from the very beginning is like, if someone gets, doesn't get you something to get the job done, you just don't get the job done, or you get the job done up to the point where you can, and you can deliver on the resource that you said that you would so AKA financial statements. Up to the information that was given to you. So that's like the simplest way to just kind of pack in what I'm about to teach. In today's podcast episode. So let's kind of deep dive into one. Nobody likes when our clients don't get us information. But the reality is in our space. It happens pretty often that clients don't get us what we need and it's okay. Like, remember we're also really busy business owners. Can you imagine the business owners that we also work with? They're super busy, too. So sometimes when they see those monthly requests or though they get those emails from you. It just makes life so much harder for them because. We need this information. Like this is so imperative to get our job done, but at the same time, just give them grace and just know that it just might take them some time. But at the same time, identify what are those expectations that you need to. Have in place that the client knows about and that you know about. So before I really dive into the three key points that I want to cover, the one thing that just kind of came to my mind, as I was talking is I would love for you to take a step back and look at well, how are you requesting information from your clients? So before we dive into like the logistics, I think a lot of times people. Don't want to recognize that maybe you're your own system is flawed. And that's not to say that. And in any sort of mean way, it's just an opportunity, like to sit and question yourself. Is the way that I'm asking my clients for information hard for them to get it done. Let's just give an example. Let's just say that you send an email to your clients and say, I need this, this, this all in one email. And the email is like this really long list of things that they need to do. And so you expect them that as they check their email, that they can go ahead and respond to this thing. That might be overwhelming for the client. It might be a lot of questions in one email. It doesn't really hold people accountable. It may not have the ability to maybe check boxes off because I know for me, I like to do things where I get to check the box off. So that way, I know that I've actually done that they might be continuously building onto that email and putting it in their draft and never sending it because there's so much information you're requesting. Maybe another option is you're requesting it through maybe something like keeper. That's great keeper. The beauty of something like keeper and Xanax is keeper and Xanax can both send request to your clients, but let's just say that you have the keeper, like request or the Xenex requests. Let's just say that you have it set up to. I don't know, send a weekly email to your client to say, Hey, don't forget. These are the open action items that we need you to fill out and Xanax for keeper. That's great. But at the end of the day, this is why I don't do requests and Xanax or keeper. I used to use keeper, but now we use NX. But they do pretty much the same functions. And the reason why I don't use NX or keeper to request things from my clients is because I don't want to bombard by client every single week, reminding them of all these things I still need. I like when things get sent over and over and over again, it's so repetitive. That's the same subject line, the same questions, the same information that at the end of the day, like we're creatures of habit. So when we see that same email come in all the time, it's like, Oh, I know I'm going to have to give her information. I'll get it to it later. Right. And so like, you have to approach things in a different way. And not bombard someone with it. So for example, for us, the only time that we're ever bombarding, like our clients with like, Hey, we need info. Hey, we need info. More on the weekly basis is when we're onboarding, because onboarding for us is two weeks. That's our expectation. We don't want to be onboarding for longer than two weeks. Sometimes it does happen depending if the client gets this information or not. But at the end of the day, like I'm going to send a weekly request for that. Versus on a monthly, like bookkeeping maintenance basis. We're only going to send once a month. So if you are using something like keepers, and I said, does have the ability to like maybe send out a weekly reminder. I would just reconsider, like maybe not having to do once a week. And, or talk to the client, ask them like, how many reminders do you actually need? So at the end of the day, like we all kind of internalize what we think our clients need without asking what they want. So same thing. And like, I started off with this episode where I told you guys, I reached out to you guys to ask you guys what you want to hear, because what I think you guys want to hear on the podcast is wildly different than what you actually want to hear. So same thing for our clients. Sometimes what we think the client wants is not actually what the client wants. So. Reach out to them and say, how often do you want this? Do you like it in the format of an email? Do you prefer it? And like the system that we have, like, what do you need while at the same time sticking to your own process? Like, for me, I'm huge on like, it's my process. It's our way or the highway. Like, that's just how I operate and that's totally fine, but I also have really good systems. So like, I don't need to like test things out anymore. It's pretty solid. It's working really well. And it's really rare that we're like changing the full process. And so I'd really consider like first, before we dive into all these other things, how are you asking for. This information, is it making it really hard for the clients? Are you being very vague? One thing I do when I'm hiring new team members is I tell them all the time, like always send emails and information to people as if that they are going to come back and ask you a bunch of questions. So AKA is your email giving enough information? That they don't even have to ask questions. And so this is really important. So think things like, for example, if I'm sending an email to, I don't know, a client asking to set up a call with them, I'm not just going to say 10:00 AM.

I'm going to say 10:

00 AM PST because they're going to come back and say what? What's the time zone, right? So like, you could see how, if we're missing key parts of our questions. So like, I dare you to go back into whatever way that you're actually formatting your questions. And ask yourself, is this easy? Is this fluid for the client? And if you can send out a survey, this is what we do for my, in my firm. I also teach us inside a breakthrough. I give this survey feedback form that our students can send out to their clients that essentially ask them for like certain feedback. And you could probably put something inside that feedback form or create one yourself. Like you can do this simply through Google forms, send it to all your clients. Most likely you'll get about 10% of your clients actually responding to it. But the 10% who do are going to give you a lot of insight on what's working and not working. And another way you could do this too, is when you get on the next call with your clients, you can just simply ask them, Hey, we're changing some things internally. I would love to ask you, like, You know, what are some things that we can improve as far as getting information from you? So let's kind of deep dive into the real meat and potatoes of this episode, but I really wanted to preface that. So my challenge for you is to reevaluate. The way that you're actually receiving that information. So let's go ahead and deep dive into what the expectations are that you need to have in set in stone. When the clients don't give you the information that you need. So first things first. It's always about setting the tone from the beginning. And I recognize that sometimes we already have clients that we had started our business with, and we didn't really have a structure in place. And that's okay. You can always go back on that, those expectations that you originally set and just say, Hey, there's new expectations that I have moving forward. Here's what they are. So my first thing is I would sit down and make sure that you have something super clear upfront. Maybe it's in your onboarding that says, this is what we expect of you or something that you cover in your sales process. So in your maybe your prospect call for us, I set the tone in that prospect call as well. That if you don't get us information, we're going to charge you extra for it. So set the expectations from the beginning, if you can. So reevaluate how you're setting the tone for your clients from the very beginning. And what I like to do. And what I like to encourage everybody to do is that when you're talking about the expectation of how important it is to get accurate information over to you guys on time, Is, I want them to know how it's going to impact them and how it's going to impact us. So I always start to lean into it's going to impact your financials. They're not going to be accurate. If you went to go to the bank today and you wanted to buy a house, you're going to literally have to scramble last minute to get it to all of this information, you're going to be stressed out, trying to get this loan for this house. And I like paint this picture for them of like, if you don't get us information, you can't do the things that you really want. And I'm usually tying it to the things that we maybe talked about during our consult call. Usually on those calls, I'll ask them like, what do you really want? Like, not just the business. I mean, like in life, right. That's a really deep question, but I do ask that. So maybe it's like, I really want to buy a house, but right now the cashflow is just really tight. Then I'm going to use that conversation to say, if you don't get us or our financials and time. I'm gonna use that same instance where you won't be able to get the loan that you want for the house, because you're going to need, financials that are accurate. Yet you haven't given us information. We can't, you know, just crank them out tomorrow. That's just not how it works. And so like, if you can just show them the impact of not getting you guys information, it does way better than saying, if you don't get us our stuff on time, we're just going to charge you. So like, what I would love for you to do is just take a step back and say, how can I put this in my expectations to say how it's going to impact them in a way that is going to be negative on their end, if they don't take action towards it. Another thing too. Is. At the end of the day, like, I like to make it very clear to the client, like. D the financials won't be accurate at all. Like, if you don't get us what we need, you can never just go tomorrow and just file your taxes.'cause like, that's just how it is, right? Because like we need accurate information and get the job done. And so what I like to do is set that tone as well. That like, if you guys don't get it to us, it's not going to be accurate for you to be able to make the right sound financial decisions. And then for me, what I like to recommend is. You can only care as much as your client does and that's in all areas of servicing your clients. I know that we all truly care about what we do and truly want to support our clients. But at the end of the day, if the client does not get you the information and the details that you need to fully service them in the way that you promised in your contract. It is a failure on their end and there's only so much that we can do. And if your client doesn't care as much as you do. That's their, that's their issue. And I know that sounds really harsh, but at the end of the day, like, These are their financials. You're here to do the job, and I know that you want to do the job accurately and you want to do it correctly. I understand that. But you can only care as much as your clients do, but I will say that this is how you set the tone for the type of clients that you work with. We only work with clients who care. Who only work. We only work with them. If they care to have the accurate information, to get us over the details. And so you could set the tone to say, I decide as a business owner that this client doesn't care about, their financials are constantly behind on getting information. I actually no longer want to work with this type of client and that's okay. So I just encourage you, like, as you're setting those expectations, like, what do you want as well with the type of people you work with? So the next kind of topic here is in the question that they had, uh, submitted on Instagram is what additional pricing will you layer into like your contract? That's kind of like the high level question I had gotten from the original question. And I could tell you that for us, we do charge an additional fee. If the client is X number of months behind. So you could determine that number of months, you don't have to do this. You can do it. It's really up to you. This is just an opportunity for me to share with you, something that I've been doing that's been working really well. So we had a drafted into our contract. So I use a lawyer. Her name is Lindsay Shay consulting. And I'll go ahead and drop her information below. could buy, like she has these, um, custom contracts that I actually talked to her and I was like, Hey, like the accounting space really needs solid contracts. So she actually drafted them where you can like buy them in bulk. And I'll give you guys, I think I have a 10% off code. Which I'll drop it in the show notes for you guys, but you can also hire her. One-on-one. To adjust that contract to add in new layers, because like, not everybody. You know, charges additional pricing when someone doesn't give them information for so many months. And so you might want to have that drafted by your current lawyer or reach out to someone like that. Do not use something like chat TTP, do not go. Just Google it online. These things are so important because if the client comes back and fights you on it. You are legally like, like solid. That's like my number one thing I will not mess with, I will not use like automation, AI, or anything to ever draft anything. That's illegal because I want to protect myself. So for the additional pricing, what we do is I believe it's anywhere to two to three months. I should apply. Pulled it up before this. Two to three months of behind information and we define very clearly inside of our contract. What does it mean to be behind with information? So I'll give you a great example of this. Maybe the client just hasn't sent you, like, I don't know their S-corp election documentation. I don't really care to see it. Like if you don't send it to us, it's fine. Like, we know that you took the election, we're going to trust that you did right. But there is some information that we actually do need, so maybe answers on some travel stuff or this, right. So like define very clearly in your contract, what it is that will constitute the additional fee as like doing back work when you receive that information. And so what we did was we drafted the contract that I believe it's two or three months of behind information. That we have to go back, essentially, you're doing a cleanup. Like you're literally going back in time and having to clean it up when you finally receive it. So when those two to three month threshold hits, we then start to charge and you can do this. Like, we don't usually do hourly fees, but this is an instance that we will actually do an hourly fee. It's very, very rare that this ever happens. But if it does, it's just an hourly charge. So we'll charge them an hourly rate and build them separate. To have us go back once they give us the information, that's anything beyond two to three months. And so like, you just have to define it. Like I said, I would not put two to three months. It would literally be either two months or three months. I just can't remember what we put in our contract. Probably should have looked. So I just kind of want to make that super clear as like put the expectations. And then how you're gonna actually roll this out because a lot of people don't read your contracts and they'll forget this stuff. That's why onboarding calls are really helpful because during the onboarding call, you could set that tone. If you don't do onboarding calls, that's totally okay. But maybe it's in like your welcome email. As a reminder, please send information by X date. And then when you're actually maintaining the client and you're actually sending out, let's just say monthly requests, maybe through something like content snare, which is my favorite monthly requester, which is where we send all of our requests to our client of all the things that we need. Let's just say that you send out the request. In your notes on that, you know, request whatever you're sending it. Maybe it's through keeper, content, snare, or even like email. You could put a note that says, as a reminder, please make sure to always submit information needed because anything that's Past two months of information past due, we will charge you an hourly fee to go back to clean it up. And so like, you can remind them in different ways. And then for example, like, let's just say a month has passed and the client. Like fail to get you the information that's when you can be sending out reminders, you can send a reminder to the client and say, Hey, I just want to let you know, like, as a reminder, I know that life gets busy businesses busy. But as a reminder, per our contract, anything that's over two months of past due data and information not submitted to us will be charged at X hourly fee. I would hate to have to do that for you. So can you please just get us over the information like by next month, that would be super awesome. And it's as simple as that. So it's just building into the contracts, setting up those reminders and setting the expectations of how many months behind will you guys start to charge and then pick that pricing. So for us, I believe our hourly fee is anywhere from like 90 to 110, I think, dollars an hour. And. That's only whenever we're doing the back. Cleanup fee. Other than that, we value price to like we'll our base fee is 400 a month. And then everything after that is like, beyond that, like none of our clients are at 400. They're all above that. So that's kind of how I would tackle the additional pricing, because like you could decide that it doesn't make sense to additionally price. When someone's got back do information, like I said, just be really clear and define what information is the type that's crucial that you will charge them. The last thing that I wanted to cover before we kind of end this off is do we resend the financial statements when the, when the client finally gives us the information and we finally adjust the books. This short answer. No. The only time that we ever do, as it fits requested by the client, after we have completed or back cowed up whatever information they finally gave to us. And we finally updated the reports. We will only upon requests like. We're going to do our due diligence. So like what we're going to do on a monthly basis, like, I'll just walk you through our process. It's the month we're starting to close out the client. We send out a request to the client, client fails to get us information. It's been, we're waiting till the end of the month. We're finally hitting our deadline to say, okay, like our rule of thumb is by the 14th of the month. If the client does not answer everything, we are going to finish closing them out. And we're going to do as much as we possibly can to just get them financial statements. What we do is on that financial statement, we will put a note. At the bottom that essentially says this information is not going to be accurate because a failure of information not provided by X client. It doesn't say that specifically, make sure that you guys get legal jargon for that 100% to. so it says at the very bottom, and then it literally lists out the things that the client still hasn't gotten for us. And then what we do as well is that when we send the financial reports to the client, we're also saying that in the email as well to say. Hey, here's your financial reports for the month. And just as a reminder we actually, the financials are not accurate because of you failed to give us X, Y, Z as a reminder. It's a great time again, once again, remind them as a reminder, we're one month behind on this information, but if it becomes past two months of missing this information, we will have to charge you X number of dollars per hour to go back and clean it up when you finally give it to us. So please make sure to do it by next month. And so it's just a great way to remind the clients again, here's the financial statements they're inaccurate. This is why they're inaccurate, inaccurate. And please remember that we're going to charge you once you get us. If it's past this date. And so for us, like I said, we only do the reproduction of the statements only if it's requested after they've given us information. And after we've made changes, it's really where that the client needs those past documents, especially if like it's been two months. Like, why would you want to go back two months and like, look at the data unless you're like doing cashflow projections or. Forecasting there's many different reasons why you might need to go back. There could be also getting alone or like they're trying to sell the business. There's so many different reasons why that might be, need to be reproduced. But it's up to the client and this is all goes back to, you can only care as much as your clients do. Like if your clients. Can't expect us to like drop everything with a hat. Just as soon as they get us information, that's past due. You set the tone, you run the show, they fit into your process. And just rework how you're doing things, how you're setting the expectations, what that additional pricing layer is, and also your expectations on resetting financial statements. And you're good to go. So hopefully via tour group, LLC. Accounting. Thank you for submitting this on Instagram. I really appreciate you. If you have any further questions or if you want to deep dive into this, or you're someone. listening to this has been taking some notes. Or have any queues, please feel free to reach out to us. On Instagram, that's at workflow queen, or you could go email us@supportatworkflowqueen.com. We talk about a lot of these different things too, as well inside my group coaching program, breakthrough. And yeah. If you guys have any questions, I hope you enjoy today's episode and don't forget to always tell me, what do you guys want to hear on this podcast? That way I can help you guys directly.