An attorney is often hired to represent clients in litigation or to provide legal advice and services related to acquisitions or mergers, or when they enter into contractual arrangements. CPAs are hired not only for the preparation of financial statements and tax returns but also for consulting as to mergers and acquisitions, strategic planning and succession planning. While hiring a professional for such services is often the best decision, Glenn Gelman, managing director of Glenn M. Gelman & Associates, says there are tips a client should keep in mind when working with such professionals.
Smart Business spoke to Gelman about how a client can reduce professional fees and get the most out of the professional’s expertise.
What should a client ask a professional before beginning services?
One should ask about billing policies including critical items such as hourly rates and support charges such as phone calls, e-mails, faxes and copying. Professionals such as attorneys often charge by the tenth of an hour. So if you send a professional an e-mail or you leave a one-minute phone message, you may be billed for that service.
Not all professionals subscribe to this type of billing process, but often a client doesn’t find out until it is too late. If a client asks the professional at the beginning, this type of billing can be avoided. All services and billing agreements should be put in writing to avoid unpleasant surprises that weaken the relationship.
What hidden charges should a client be aware of when using professional services?
Behind-the-scenes prices such as copies and faxes are often inflated. Out-of-pocket costs that are often not described clearly may become a financial burden to the client. In instances where a client is using the services of an attorney, law firms may place two attorneys on a case when only one is necessary.
The law firm may believe that two attorneys working on a case is beneficial, because while one is asking questions during a deposition or a trial, the other one is thinking of what to ask next. Depending upon the case and circumstances, this may be inefficient with no real benefit.
What can a client do to reduce professional fees?
The entire process should start with a detailed engagement letter. This letter should describe the nature of the services to be performed. It should include the responsibilities of the client, an estimate of the fees and an outline of the billing process. It should determine who is responsible for paying the fees.
A client should not sign or agree to anything until they receive such a letter. In the case of legal services, you can ask for a range of fees and negotiate those fees before agreeing to services. They may also be able to negotiate a flat rate for services.
The key is discussing fees before starting business, because once you have started and are obligated you cannot readily pull the plug.
How should a client select a professional and what are important attributes for a professional?
Most people use the same professionals that their friends do. The problem is that no two people and no two needs are the same. A better approach may be asking the professional for a list of references, plus four or five more names, so you will not only get people who have agreed to be references.
Depending on the professional, you can use different resources to check their professional history. One can use the Department of Consumer Affairs for attorneys and CPAs to see if there have been complaints. Lawyers.com also provides links such as martindalehubbel.com that can provide ratings services.
A client should look for someone who pledges to be responsive, who will return phone calls within a certain period of time and who has a great deal of expertise in the issue in which they are dealing.
What can a client do to get the best service possible from a professional?
One should schedule frequent meetings, talk about their expectations and discuss the progress of the situation. If a client gets an invoice they are upset about, it is important to call the attorney or CPA and ask them to stop work immediately until you can schedule a meeting to discuss the matter at hand.
One should be organized and well-prepared. A professional often will provide an organizer or questionnaire before the first meeting. Do not pay someone to organize your information.
Ask the professional before the first meeting what you can do to reduce fees and be prepared.
Glenn M. Gelman, CPA-MST, is managing director of Glenn M. Gelman & Associates. Reach him at (714) 667-2600 or email@example.com.