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Do you know what fees your auditing firm is charging you for?

audit firm feesEvery year our company holds a major golf tournament to raise money for the local branch of a national charity. We ask all of our vendors, including our auditing firm (Big 4), to participate in the tournament and to make a contribution. They are always happy to, and we are always appreciative. This year, we are conducting an exhaustive review of all of our expenses, with a key focus on our professional fees- especially the accounting firm's fees. Upon review of a detailed listing of all the charges billed back to my company, I found that the accounting firm has charged us back for the sizeable donation they made to the charity. Honestly, I know they charge for EVERYTHING, but am I naïve to think that the contribution should be their expense? Does anyone have experience with this? I can sure use some guidance before I grieve this charge. Thanks.

Answers

Anonymous
(Director of Finance and Corporate Controller, Assistant Treasurer) |

This sounds unethical to me. Does anyone else share that opinion?

Len Green
Title: Performance Improvement Consultant and E..
Company: Haygarth Consulting LLC
LinkedIn Profile
(Performance Improvement Consultant and ERP Strategist, Haygarth Consulting LLC) |

Anon
Check your letter of appointment/terms of engagement with them to see how explicit it is in terms of reimbursement of expenses.
Then ask the firm to explain how they decided to charge you back for the donation and listen to their response.
Then wait to see if they agree to get involved this year in the charity event.
Then decide what your company should do regarding your choice of auditors. You don't indicate if you are a public company, so whether an Audit Committee of the board should get involved is something else to determine.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

A "Charity Donation" is not (or definitely should not be) a reimbursable expense for a professional organization. I'd say most consider it advertising/marketing.

I'd have a conversation with the Partner in Charge of the office your account is located at; and then find another firm.

Chris Shumate
Title: Accounting Manager
Company: Dominion Development Group, LLC
LinkedIn Profile
(Accounting Manager, Dominion Development Group, LLC) |

Anonymous - It's been a couple of months since your question. Did you get some sort of resolution on this? The problem with Big 4 firms is you pay Big 4 prices, so they will charge you back for ever little thing.

I am with Len and Wayne on this one in how you should resolve it. For tax purposes, since the firm charged the company back for its donation, I think it's worth a shot to ask the tax accountants for your firm it that charge back could be used as a deduction.

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