Are You Actually Charging What Your Firm Is Worth?
Why focusing on charge rates alone can hide a much bigger pricing problem
For a long time, pricing conversations in accounting firms have revolved around charge rates.
What’s the hourly rate? Is it competitive? Has it increased this year?
But that focus is increasingly misleading.
Because charge rates don’t tell you what the firm actually earns — and in many cases, they mask a pricing problem that only becomes visible once margins tighten, capacity disappears, or owners start thinking about their exit.
What matters is not the rate on the page. It’s what’s left after the work is done.
Charge Rates Can Hide the Real Problem
Until now, Australia’s AML/CTF regime has focused largely on banks, casinos, remittance providers and similar institutions. But regulators globally have long recognised that financial crime frequently passes through trusted professional advisers before funds ever reach a bank.
AUSTRAC has already begun directly contacting businesses in newly regulated sectors to alert them to the upcoming changes. This outreach is designed to help practices understand their obligations early — and signals that these reforms are moving from policy into active implementation.
Property transactions, trust and company structures, business sales and complex wealth arrangements can all create risk if left unchecked.
These reforms follow AUSTRAC’s long-signalled Tranche 2 expansion of the AML/CTF Act, aligning Australia with international standards set by the Financial Action Task Force (FATF). In truth, Australia is one of the last comparable jurisdictions to extend AML regulation to professions such as accounting, law and real estate.
The approach is not a blanket one. It is deliberately risk-based — but it will still capture a very large number of businesses.
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Typical Fees for Common Services Report
Price range: $198 through $396 incl. GST This product has multiple variants. The options may be chosen on the product page
Today’s Cost Base Is Not Yesterday’s Pricing Model
The profession has changed materially, but in many firms, pricing hasn’t kept pace.
Firms are now carrying higher regulatory and risk obligations, increased staffing costs, heavier technology investment, and more demanding client expectations. The introduction of additional compliance requirements, including AML/CTF, adds another layer of responsibility that must be managed, documented, and maintained.
These are not theoretical costs. They require time, systems, training, and oversight.
If those costs aren’t being deliberately recovered through pricing, they are being absorbed by the firm — eroding profitability one decision at a time.
Ignoring this isn’t conservative. It’s a commercial choice, and often an expensive one.
Price Sensitivity Doesn’t Mean Price Is All That Matters
There is no question that the market is price conscious. Clients are asking more questions, comparing options, and paying closer attention to fees.
But price sensitivity doesn’t mean clients only value the lowest number.
What it does mean is that firms must be able to explain their fees with confidence — not defensively, and not apologetically.
Clients are prepared to pay for clarity, reliability, and quality advice. What they resist is uncertainty, inconsistency, and poorly explained increases. Firms that position themselves purely on being cheaper often find themselves negotiating constantly, absorbing scope creep, and struggling to reset expectations later.
Being the cheapest is rarely a long-term advantage in professional services.
Many Owners Don’t Realise How Far Below Market They Are
One of the most common reactions we hear from firm owners is surprise.
Surprise that their fees sit well below market. Surprise that “normal” clients are paying significantly less than comparable firms charge. Surprise that this has been happening for years without being obvious.
Often, this only becomes clear when profitability stalls or when succession discussions begin. In some cases, it comes as a blunt message:
“I can’t sell your firm — you’re charging half the market rate.”
This isn’t a judgement on capability or service quality. It’s a reflection of how pricing decisions compound over time and shape how a firm is perceived.
Pricing Directly Affects Saleability
Fees are one of the first things buyers examine.
Consistently below-market pricing raises immediate concerns:
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How difficult will it be to increase fees?
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How will clients respond when pricing is corrected?
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What risk sits in the client base?
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Are margins sustainable under new ownership?
Even if you’re not planning to sell in the near term, these questions matter. Pricing decisions made today influence flexibility, valuation, and optionality later.
Firms that understand and maintain appropriate fee levels tend to have stronger margins, more resilient client relationships, and far fewer issues when ownership transitions are considered.
Knowing the Market Changes How You Lead
The most challenging part of pricing is rarely the calculation. It’s the confidence to act.
Confidence to have clear conversations with clients. Confidence to adjust fees where they no longer make sense. Confidence to stop relying on instinct and start relying on data.
Understanding how your fees compare in the market provides that grounding. It turns pricing from a reactive exercise into a strategic one and gives firm owners the ability to make decisions that support both performance and longevity.
Pricing Is a Strategic, Not Administrative, Decision
Fees are not just an output of charge rates or tradition. They are a deliberate leadership choice.
They reflect how a firm values its expertise, protects its people, and positions itself for the future.
As the profession continues to evolve, firms that thrive will be those that understand what they earn, price accordingly, and communicate their value without hesitation.
And that starts with seeing the market clearly.
Useful Products for Your Practice
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Typical Fees for Common Services Report
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December 2026 Charge Rates & Salaries Report
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Written by Michelle Knights
Michelle advises professional services firms across Australia on practice risk, governance and regulatory readiness, working closely with accounting, legal and financial services businesses navigating structural and compliance change.
Want to know more? Book a 15-minute call with Michelle Knights and discover how she can help your practice.
What practices are selling for, and what is moving the numbers
Michelle’s monthly note on practice valuations, buyer activity and the conditions we are seeing across accounting, financial planning and legal firms.
