Annual Audit. Am I Being Ripped Off ?

[mortenaa]

Hi!

I started a new company in June last year. A lot to learn and to discover. I setup everything through a company that provides business services, and also started out using their accounting.

They provided me with a price list. The annual audit starts at 13,000 Baht, and consists of providing the following documents to the government:

- Por Ngor Dor 50

- Sor Bor Chor 3

- Shareholder List

- Company documents.

I would typically end up around 13,000 Baht, because my transactions last year is not that many.

Then, last fall i changed my accountant. The monthly fee was a little bit higher, but they said the "Annual Financial Statement" was cheaper than the competitor. In this case 8,500 Baht.

The agreement consists of:

- Submit Annual Employee WHT (Por Ngor Dor 1A)

- Prepare yearly balance sheet, Statement of income and Changes in shareholders equity

- Preparing and submitting year ended Corporate Income Tax Return (Por Ngor Dor 50)

- Preparing and submitting year ended summary Financial statement to Ministry of Commerce (Sor Bor Chor 3)

- Preparing and submitting company shareholder list (Bor Or Jor 5)

Recently, when I got a draft of the annual statement, they also sent me a new service agreement for an Annual Audit Fee of 12,000 Baht!

Ofcourse i don't agree to this. I checked the the original service agreement, and its stated at the end of the page "*Not included annual audit fee"

Isn't the "Financial statement" i already agreed upon the "Annual Audit"?

So am i being ripped off? Isn't this "Annual audit" just someones signature on the actual statement ? Can the accountant sign off on this, or do someone else have to do it ?

Please advice what i should do..

Cheers!

[ray08]

Hi!

I started a new company in June last year. A lot to learn and to discover. I setup everything through a company that provides business services, and also started out using their accounting.

They provided me with a price list. The annual audit starts at 13,000 Baht, and consists of providing the following documents to the government:

- Por Ngor Dor 50

- Sor Bor Chor 3

- Shareholder List

- Company documents.

I would typically end up around 13,000 Baht, because my transactions last year is not that many.

Then, last fall i changed my accountant. The monthly fee was a little bit higher, but they said the "Annual Financial Statement" was cheaper than the competitor. In this case 8,500 Baht.

The agreement consists of:

- Submit Annual Employee WHT (Por Ngor Dor 1A)

- Prepare yearly balance sheet, Statement of income and Changes in shareholders equity

- Preparing and submitting year ended Corporate Income Tax Return (Por Ngor Dor 50)

- Preparing and submitting year ended summary Financial statement to Ministry of Commerce (Sor Bor Chor 3)

- Preparing and submitting company shareholder list (Bor Or Jor 5)

Recently, when I got a draft of the annual statement, they also sent me a new service agreement for an Annual Audit Fee of 12,000 Baht!

Ofcourse i don't agree to this. I checked the the original service agreement, and its stated at the end of the page "*Not included annual audit fee"

Isn't the "Financial statement" i already agreed upon the "Annual Audit"?

So am i being ripped off? Isn't this "Annual audit" just someones signature on the actual statement ? Can the accountant sign off on this, or do someone else have to do it ?

Please advice what i should do..

Cheers!

I cant see how you can get an Audit for thb 12,000 , Rememeber auditor will come to your office ,check statements, send letters to customers to esure invoice correct ,etc ,etc, and them give you a binded copy both in English and Thai, in my first year here when business was small i paid about THB 50,000 for Audit and accounts,

Also a bit of Advice , make sure you have a decent auditor who knows what they are doing , otherwise you may have all kinds of problems with revenue department ,

[mortenaa]

I cant see how you can get an Audit for thb 12,000 , Rememeber auditor will come to your office ,check statements, send letters to customers to esure invoice correct ,etc ,etc, and them give you a binded copy both in English and Thai, in my first year here when business was small i paid about THB 50,000 for Audit and accounts,

Also a bit of Advice , make sure you have a decent auditor who knows what they are doing , otherwise you may have all kinds of problems with revenue department ,

I pay an external accountant to do the financial statement. Does that mean they have to hire an external auditor to sign off ?

[ray08]

I cant see how you can get an Audit for thb 12,000 , Rememeber auditor will come to your office ,check statements, send letters to customers to esure invoice correct ,etc ,etc, and them give you a binded copy both in English and Thai, in my first year here when business was small i paid about THB 50,000 for Audit and accounts,

Also a bit of Advice , make sure you have a decent auditor who knows what they are doing , otherwise you may have all kinds of problems with revenue department ,

I pay an external accountant to do the financial statement. Does that mean they have to hire an external auditor to sign off ?

Some external accoutants are not qualified to Audit , so they either say they can do and just hire an Auditor and charge you direct or some will just refer you to an Audit Firm,But Audited accounts are pretty serious here and must be done correct , and again make sure whoever does it for you also provides an English Version for yourself ,

[Moonfruit]

Our Audit was 20,000THb.

Audit costs from licenced auditors depend on the number of transactions (invoices and more importantly receipts) that have to be verified etc etc.

(Im no expert! Just a guy working for a company here for the last 5 years!)

We turnover around 12 million a year gross, but only between 6 to 10 invoices/receipts per month.

My father's company (UK based) is part of the largest International network of accountants (MGI) and their Thailand office wanted 27,000THb for the audit. Methinks Ray needs to have a look at his audit costs, unless his accountant deemed it prudent to charge the company that amount to offset profits. 50,000THb is a big audit!

Additionally, i have found that it is not actually a particularly bad thing to have the revenue dept. visit your office. Dont be too scared of it. If everything is above board they can make good friends. Much better than the stand off enemies.

[mortenaa]

Our Audit was 20,000THb.

Audit costs from licenced auditors depend on the number of transactions (invoices and more importantly receipts) that have to be verified etc etc.

(Im no expert! Just a guy working for a company here for the last 5 years!)

We turnover around 12 million a year gross, but only between 6 to 10 invoices/receipts per month.

My father's company (UK based) is part of the largest International network of accountants (MGI) and their Thailand office wanted 27,000THb for the audit. Methinks Ray needs to have a look at his audit costs, unless his accountant deemed it prudent to charge the company that amount to offset profits. 50,000THb is a big audit!

Additionally, i have found that it is not actually a particularly bad thing to have the revenue dept. visit your office. Dont be too scared of it. If everything is above board they can make good friends. Much better than the stand off enemies.

Thanks for information. I think i will conclude with that i am not being ripped off. I just got an email from my accountant too. She said that she could not sign off as both accountant and auditor, and she hired an external company for that. So i guess its fair.

Other people with experience about the same subject, please share your knowledge. Thanks!

[Wekhin]

An accountant does the bookkeeping job, prepares transaction documents, analyses transactions and documents, records in the books, prepare financial statements, according to accounting principles and standards.

A licensed auditor examines and verifies if the above procedures adhere to principles and standards. Financial statements must be auditted by a licensed auditor.

A practice of crossing over between accounting and audit is unethical. It is like doing and verifying them all by the same person.

There are other people who wants to know about your company financial statements such as shareholders, government agencies, creditors, suppliers, customers, banks, etc.

[Moonfruit]

^ You are very correct Wekhin, correct indeed.

However, where do 90% of licenced auditors work? In the office next door to licenced accountants!

These guys have relationships, and the world over it is generally better to be audited by an auditor that has a good relationship with your accountant.

[Martin_F]

^ You are very correct Wekhin, correct indeed.

However, where do 90% of licensed auditors work? In the office next door to licenced accountants!

These guys have relationships, and the world over it is generally better to be audited by an auditor that has a good relationship with your accountant.

It really depends on what you are looking for from the audit.

If you see it as a third party verification of your outsourced finance function then get an auditor who does not work next door and his opinion can be used.

Otherwise if you merely need to comply with the law (registered accountant and separate auditor go for the package next door). But don't come crying back in five years time when the Revenue Department comes to audit and raises back tax demands (with 200% fines).