Time and Billing - Enlighten Your Team about Time Entry

Welcome to the AccountingWEB series "Possibilities for CPA Firm Management" by Rita Keller, CPA firm management consultant. You can see all of her articles here
 
If you're a value-pricing firm, disregard. Good for you, and I bet you have a lot of happy team members. I also imagine that you have well-trained managers who mentor and guide them through client engagements.
 
If you're not a value-pricing firm, like most of the firms I talk to and work with, I bet you get asked: "How do we enter our time for traveling to a client location? Is it chargeable or not?"
 
A question on the Association for Accounting Administration Discussion Forum (Q&AAA), addressed this issue, and there were a variety of replies to the question of how to handle travel time.
 
Just FYI, here's what I recommend:
  • Team members record time in excess of their normal commute if going to a client site directly from home.
  • The time code used is one-half of the normal billing rate. This allows the team member to have chargeable time.
  • Mileage is also charged to the client.
  • If leaving the office to go to a client site, the team member records his or her time and mileage from the office to the client site.
  • Tell your team members: Do not make a billing decision when recording your time  accurate time entry is a top priority.
  • All time related to a client should be recorded. Each team member should ask themselves, "Would I be doing this task if we DID NOT have this client?" If the answer is "no," then it's chargeable time.
DO NOT confuse chargeable time with billable time. All chargeable time should be recorded  it doesn't mean that it will all be billed.
 
Consider hosting a training session on time entry in early January, just to refresh the experienced people and to help enlighten new people. It's important to communicate the "FIRM way" and not leave it up the whims of individuals. First step, get all the partners on the same page.
 
About the author:
Rita Keller is a nationally known CPA firm management consultant, speaker, author, mentor, and blogger. She has over thirty years of hands-on experience in CPA firm management, marketing, technology, and administrative operations.
 

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