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First lesson · Start here · Free
Is your firm really making money?
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Most CA offices are busy. July is a blur of returns, September is audits, and the rest of the year fills itself with GST, TDS, notices and "one small favour". Busy feels like success. But busy and profitable are not the same thing. Many owners work twelve-hour days and still cannot say which work pays for the office and which work quietly loses money. This free lesson gives you four plain numbers and a ten-minute check of your own firm.
A story you may know
Two offices on the same street
CA Meera and CA Rohit both run small offices with six people each. Both billed about Rs. 60 lakh last year. Meera took home far more. Why? Rohit did 900 small returns at low fees, with endless calls and chasing. Meera had 120 monthly GST and accounting clients on fixed fees, a few audits, and fewer, larger one-time jobs. Same revenue, very different profit. Rohit did not know this until he counted.
The four numbers, in plain words
You do not need accounting jargon to run a profitable firm. You need four numbers, and you need them for the firm as a whole, then for each service and each client.
| Number | What it means | Example in a CA office |
|---|---|---|
| Revenue | Fees you billed for your work in the year | ITR fees, GST retainers, audit fees, certificates, advisory |
| Direct cost | Cost that exists because of the work | Time of the people who did it, outsourced work, filing and processing charges you bear |
| Overheads | Cost of keeping the office open, whatever the work | Rent, electricity, internet, software, phones, admin staff, travel, CPE |
| Profit | What is left after all of the above, including a fair salary for each partner | Money the firm can save, reinvest or share |
One word about "a fair salary for each partner". If you leave out what the partner's own time is worth, the firm looks profitable while the partner is working for free. In this course we count the partner's time as a cost, at a salary you could pay someone to do that work. This is an internal management number only. It is not your statutory accounts and it is not your taxable profit.
Three traps that hide the truth
- Looking only at revenue. "We crossed Rs. 50 lakh" says nothing about what was left.
- Looking only at the bank balance. Cash in the bank includes GST you owe, advances for work not done yet, and money you have not yet paid out. Lesson 10 separates cash from profit.
- Averaging everything. A firm that makes a good profit overall can still lose money on two of its services and ten of its clients. The average hides them.
The ten-minute profit check
Answer yes or no for your own firm. Each "no" points to a lesson in this course.
- Do you know last year's revenue split by service (ITR, GST, audit, accounting, other)? (Lesson 1)
- Do you know your total yearly cost, including a fair salary for each partner? (Lesson 1)
- Do you know roughly what one hour of your office's time costs? (Lesson 2)
- Can you name your most profitable and least profitable service? (Lesson 3)
- Can you name five clients who cost more than they pay? (Lessons 4 and 5)
- Is more than half your revenue recurring (monthly, quarterly or yearly retainers)? (Lesson 6)
- Do you have a written revenue plan for this year, by month? (Lesson 8)
- Have you checked every software and subscription you pay for in the last six months? (Lesson 9)
- Do you know how many months of costs the firm could pay if no fee came in? (Lesson 10)
- Do you look at the same few numbers every month? (Lesson 12)
Seven or more "yes": you are ahead of most small practices, and the course will sharpen what you have. Four or fewer: start with lesson 1 this week. Most owners find at least one service or client that has been losing money for years.
What this course builds, step by step
| Part | Lessons | You will have |
|---|---|---|
| Know your numbers | 1, 2 | A one-page firm profit statement and your cost per hour |
| Where the profit is | 3, 4, 5 | Profit by service, profit by client, your 80/20 list |
| Grow the right income | 6, 7, 8 | A recurring-income target, an internal price policy, a yearly plan |
| Control and cash | 9, 10 | A cost and subscription audit, a cash calendar, a drawings rule |
| Decide and track | 11, 12 | Tests for hiring, saying no and buying tools, and a one-page dashboard |
This course looks at the whole firm. Pricing a single client, fee-revision letters and collection reminders are covered in the course Client Handling & Fee Collection. Spreadsheet formulas are in Excel for Tax Practice. We point to them where they fit, so you do not learn the same thing twice.
Within the rules
Running a firm for profit is fully within the rules. A few rules touch money directly: how fees may be based, minimum fees, sharing fees, and publicity of fees. Lessons 7, 10 and 11 cover them with sources. The Chartered Accountants Act and the ICAI Code of Ethics bind CA members and their firms. Staff follow the firm's policy. Tax practitioners who are not CAs are not bound by the Code, but this course follows it throughout. Nothing here is tax advice: for how the firm's profit or a partner's income is taxed, ask your own tax adviser.
Do this today (10 minutes)
- Answer the ten questions above and write down your score.
- Guess your most and least profitable service. Keep the guess; you will check it in lesson 3.
- Ask your accountant or bookkeeper for last year's profit and loss account of the firm, ready for lesson 1.
Know where your firm makes money: unlock the other 12 lessons
What an hour costs, profit by service and by client, recurring income, firm-level pricing within ICAI rules, a yearly plan, cost control, cash flow and a one-page dashboard. Rs. 999 + GST, one time · or the Office Subscription Plan from Rs. 1,499 / year for every course, for you and your staff.