"Accounting? I can handle that myself — why pay someone?" Most Hong Kong SME owners have thought it. Money is tight early on, and accounting fees are the first thing an owner looks to cut. But does doing your own books really save money, and is monthly accounting necessarily expensive?
This article does not stop at generalities about hidden costs. We work through real numbers for three common scenarios (micro, start-up and growing company), comparing three models: doing it yourself, year-end accounting, and monthly accounting — most comparisons leave out that middle option entirely. Find the scenario closest to yours and do the arithmetic.
In this article
- 1. Three models compared
- 2. Market rates
- 3. Costing your own time
- 4. Three worked scenarios
- 5. What errors really cost
- 6. Eight common DIY mistakes
- 7. The hidden cost at the handover
- 8. The hybrid model
- 9. Seven signals to outsource
- 10. What to ask a monthly accountant
- Four dimensions compared
- FAQ
1. First, the three models
Most comparisons only contrast "yourself" against "outsourced". There is an option in between that many people overlook.
| Model | How it works | Frequency | Indicative cost |
|---|---|---|---|
| Doing it yourself | The owner or a staff member sorts vouchers, classifies and posts entries, reconciles and prepares statements | Depends on your discipline | Nominally free; in reality time and error costs |
| Year-end accounting | A year of vouchers handed to an accountant, processed in one go at the year end | Once a year | From HK$900 (fewer than 20 transactions a month) |
| Monthly accounting | Vouchers submitted each month; the accountant posts, reconciles and produces management data | Monthly | From HK$200 a month (fewer than 20 transactions a month) |
Year-end accounting is the most underrated middle option. For a company with very few transactions — a dozen or so a month — HK$900 at the year end covers the whole compliance requirement, for less than buying software yourself. Yet many owners do not know the option exists and struggle on with a spreadsheet.
2. Market rates: know what is reasonable
| Service | Market range (HK$) | Stepcon reference |
|---|---|---|
| Monthly accounting (small company) | 500 – 1,000 per month | Plan A from 200 per month |
| Monthly accounting (SME) | 1,000 – 4,000 per month | Plans C–D from 800–1,100 per month |
| Bookkeeping (annual) | 3,000 – 15,000 | Year-end from 900–2,000 |
| Full-year accounting for start-ups and small businesses | 6,000 – 18,000 | — |
| Statutory audit | 5,000 – 30,000 (dormant companies from about 3,000) | From 2,000 (dormant, four years or more) |
| Average auditor quote | About 9,000 | — |
| Profits tax return | 800 – 5,000 | 270 |
Stepcon's accounting tiers (by monthly transaction items)
| Plan | Transaction items per month | Monthly | Quarterly | Annual |
|---|---|---|---|---|
| A | Under 20 | from $200 | from $500 | from $900 |
| B | 21–50 | from $500 | from $900 | from $1,400 |
| C | 51–80 | from $800 | from $1,200 | from $1,700 |
| D | 81–100 | from $1,100 | from $1,500 | from $2,000 |
| E | Over 100 | By negotiation | ||
*"Transaction items per month" counts the entries that need posting: sales, purchases, expenses, bank receipts and payments, platform settlements and adjusting entries. See our fee schedule.
3. Costing your own time
This is the most important calculation in the article, and the one fewest people actually do.
The method is simple
Work out your effective hourly rate: your annual income (or the annual value you want the company to generate for you) divided by hours worked in the year. At 40 hours a week for 52 weeks, that is about 2,080 hours.
| Owner's annual income (HK$) | Approx. hourly rate (HK$) | Cost of 4 hours' bookkeeping a month | Cost of 8 hours a month |
|---|---|---|---|
| 300,000 | about 144 | about 576 | about 1,152 |
| 600,000 | about 288 | about 1,152 | about 2,304 |
| 1,000,000 | about 481 | about 1,924 | about 3,848 |
| 1,500,000 | about 721 | about 2,884 | about 5,768 |
How long does bookkeeping actually take?
- Fewer than 20 transactions a month: sorting, posting and reconciling, about 2–4 hours
- 21–50 a month: about 4–8 hours
- 51–100 a month: about 8–16 hours
- Year end, additionally: closing adjustments, preparing statements, answering the auditor, about 16–40 hours — more if nothing was done during the year
The key finding: an owner earning HK$600,000 a year who spends 4 hours a month on the books incurs a time cost of about HK$1,152 a month — already more than the monthly fee for plans A, B and C. In other words, if your time has value, doing your own books almost never pays. Unless you treat it as free time filled in around the edges — which usually means it is not being done carefully, and the risk moves into the cost of errors instead.
*Illustrative, assuming 2,080 hours a year. An owner's real opportunity cost may be higher (bookkeeping tends to occupy evenings and weekends rather than revenue-generating hours) or lower (in a quiet season).
4. Three worked scenarios
These figures cover bookkeeping only. Audit, tax filing and company secretarial fees are payable under all three models and are excluded from the comparison.
Scenario 1: micro company (about 15 transactions a month, owner earning HK$300,000)
| Item | DIY | Year-end accounting | Monthly accounting |
|---|---|---|---|
| Service fee | — | from $900 | from $2,400 ($200 × 12) |
| Software / tools | $0–3,600 | — | — |
| Time cost (3 hours a month + 20 hours at year end) | about $8,064 | about $2,300 (still sorting vouchers) | about $1,730 (submitting monthly) |
| Error risk | Medium to high | Low | Low |
| Estimated total | about $8,000–11,700 | about $3,200 | about $4,130 |
Conclusion: for a micro company, year-end accounting is the best value — cheaper than doing it yourself, with professional oversight included.
Scenario 2: start-up (about 40 transactions a month, owner earning HK$600,000)
| Item | DIY | Year-end accounting | Monthly accounting |
|---|---|---|---|
| Service fee | — | from $1,400 | from $6,000 ($500 × 12) |
| Software / tools | $1,200–6,000 | — | — |
| Time cost (6 hours a month + 30 hours at year end) | about $29,376 | about $8,640 (sorting plus year-end follow-up) | about $3,456 (submitting monthly) |
| Effect on audit fee | May rise 20–30% | Normal | Normal or lower |
| Estimated total | about $30,600–35,400 | about $10,040 | about $9,456 |
Conclusion: for a start-up the monthly and year-end costs are close, but monthly adds live visibility of cash flow. Monthly or quarterly is the sensible choice.
Scenario 3: growing company (about 70 transactions a month, with inventory and 2 employees, owner earning HK$1,000,000)
| Item | DIY | Year-end accounting | Monthly accounting |
|---|---|---|---|
| Service fee | — | from $1,700 | from $9,600 ($800 × 12) |
| Software / tools | $3,600–9,600 | — | — |
| Time cost (12 hours a month + 40 hours at year end) | about $88,504 | about $23,088 | about $5,772 |
| Effect on audit | High risk, possible qualified opinion | Year-end pile-up, information often incomplete | Normal, audit runs smoothly |
| Estimated total | about $92,100–98,100 | about $24,800 | about $15,372 |
Conclusion: for a growing company monthly accounting is clearly the best value — the lowest total cost, and the only one of the three that supports inventory and receivables/payables management.
The assumptions, stated plainly: the time costs above are the owner's opportunity cost — an economic cost, not a cash outflow. If your business is in a quiet season and you genuinely have spare hours, doing the books yourself does put less pressure on cash flow in the short term. But note that a time cost you do not pay out shows up instead as the deals you did not close. We would rather set the assumptions out and let you judge.
5. What errors really cost
| Consequence | Basis | Cost |
|---|---|---|
| Failing to file on time, or filing an incorrect return | Inland Revenue Ordinance s.80(2) | Fine up to HK$10,000 plus three times the tax undercharged |
| Additional tax | s.82A | Up to three times the tax undercharged |
| Failing to keep business records for 7 years | s.51C | Fine up to HK$100,000 |
| Late payment of tax | — | 5% surcharge, with a further 10% after six months |
| Estimated assessment issued | — | Often higher than the tax actually due; to overturn it you must object within one month with the return and accounts |
| Qualified audit opinion | — | Affects bank financing, investor assessment and customer due diligence |
| Higher audit fee | — | Scattered vouchers and inconsistent classification add auditor hours; quotes can be 20–30% higher |
For comparison: a single filing penalty (from HK$10,000) would pay for four years of year-end accounting for a small company.
6. Eight common DIY mistakes
- Mixing company and personal money — personal spending on the company card, with no explanation for large drawings at the year end
- Treating capital expenditure as a current expense — computers and fit-out lumped into "sundry", missing the depreciation allowance (prescribed fixed assets can qualify for 100% immediate deduction)
- Recording only the net platform payout — most common in e-commerce; gross sales, commission, advertising, payment fees and refunds should be recorded separately from the platform settlement report, or turnover is badly understated
- Missing closing adjustments — depreciation, accruals, prepayments and bad debt provisions all left out
- One exchange rate for the whole year — no year-end translation, no exchange differences
- Receivables and payables carried indefinitely — amounts that will never be collected are not written off, overstating assets
- No year-end stock count — the law requires a year-end stock statement and count records; estimates are one of the commonest reasons for a qualified opinion
- Putting unreconciled differences into sundry — forcing bank differences into a sundry account until the whole ledger is distorted
For a fuller list see the top 10 accounting mistakes; for organising vouchers see managing accounting vouchers and documents.
7. The handover: a cost multiplier people miss
Bookkeeping is not a standalone task; it is one link in a chain. The order is bookkeeping → audit → tax filing.
A Hong Kong limited company must appoint an accountant holding a practising certificate to audit its financial statements for every financial year (Companies Ordinance ss.394 and 405). Since 1 October 2022, registration, licensing and discipline of practising accountants have moved from the HKICPA to the Accounting and Financial Reporting Council (AFRC).
The DIY handover problem
Owners who keep their own books usually have to find an auditor for the audit separately, and someone else again to help with the return. An auditor receiving an unfamiliar set of accounts spends extra hours understanding them, asking questions and requesting more documents — and audit fees are charged by the hour. Audit fees for a typical trading SME run about HK$8,000–30,000, averaging around HK$9,000; the quality of the books usually decides which end of that range you land at.
What a joined-up service actually saves
With accounting, audit coordination and filing handled by one team, the bookkeeping feeds straight into the audit and the audited statements straight into the return, cutting repeat requests and repeated explanations. Note that a statutory audit must be performed independently by the auditor; a service provider supplies arrangement and coordination, and the opinion is the auditor's independent professional judgement. See audit and tax filing, end to end.
8. The hybrid model: a fourth path
If you want to keep the monthly fee down without carrying the judgement risk, consider a hybrid:
| You do | The accounting team does |
|---|---|
|
Sort and scan vouchers monthly Export transactions from banks and platforms Complete an income and expenditure sheet in the agreed format Note the purpose of each transaction |
Review the classifications Reconcile the bank Closing adjustments (depreciation, accruals, prepayments) Prepare the trial balance and financial statements Hand over to audit and filing |
Suits: owners with basic accounting knowledge, willing to organise their own vouchers but not to carry professional judgement. Benefit: a lower monthly fee with professional oversight retained. Condition: you must genuinely do it monthly and not slip back to the year end.
9. Seven signals it is time to outsource
- More than 30–50 transactions a month and posting them yourself is a struggle
- You now carry inventory and need to track purchases, sales and stock levels
- You have hired staff, so payroll and MPF need posting monthly
- You have several bank accounts or receive in multiple currencies
- Last year's audit produced a lot of adjusting entries, or a qualified opinion
- You have filed late or received an estimated assessment
- Bookkeeping already takes more than 8 hours a month
If any one applies, redo the arithmetic. A sensible progression: DIY → year-end → quarterly → monthly → hybrid or fully outsourced.
10. Eight questions to ask a monthly accountant
- Does the monthly fee include bank reconciliation, closing adjustments and financial statements?
- How is it charged once transaction volume exceeds the tier?
- Do you provide management reports (gross margin, receivables ageing)?
- Can you catch up prior years, and at what cost?
- Will you coordinate the audit? Is the audit fee paid directly to the auditor or collected by you — and with a mark-up?
- What is your response time for queries?
- Do you know my industry — platform settlements, stock counts and so on?
- If I change accountant later, will the ledgers and documents be handed over cleanly?
One red flag question: if a provider says "we do the bookkeeping and sign the audit report ourselves", be alert immediately. A statutory audit must be performed by an independent accountant holding a practising certificate, and the same party should not both prepare and audit the same statements.
Four dimensions compared
| Dimension | DIY | Year-end accounting | Monthly accounting |
|---|---|---|---|
| Cash outlay | Lowest (software) | Low (from $900) | Moderate (from $200 a month) |
| Time cost | Highest | Moderate (still sorting vouchers) | Lowest |
| Total cost | Depends on your hourly rate; usually highest | Best for micro companies | Best for trading companies |
| Cash flow visibility | Depends on discipline | A year behind | Live |
| Error risk | High | Moderate (everything at the year end) | Low |
| Effect on audit fee | May raise it 20–30% | Neutral | Helps keep it down |
| Tax deductible | Software fees, yes | Service fees, yes | Service fees, yes |
| Suits | Near-zero transactions with an owner who knows accounting | Micro and dormant companies | Trading start-ups and SMEs |
FAQ
What does monthly accounting cost?
By monthly transaction items: Plan A (under 20) from $200 a month or $900 at the year end; B (21–50) from $500 or $1,400; C (51–80) from $800 or $1,700; D (81–100) from $1,100 or $2,000; E (over 100) by negotiation. In the market in 2026, monthly accounting runs about HK$500–1,000 for a small company and HK$1,000–4,000 for an SME.
Is doing my own books always cheaper?
Not necessarily. Count three hidden costs. First, time opportunity cost — about 4 to 10 hours a month; at an hourly rate of about HK$288 (HK$600,000 a year over 2,080 hours), that is HK$1,152–2,880 a month, more than most monthly plans. Second, software and tool subscriptions. Third, the cost of errors — misclassification raises the audit fee, and a filing error carries up to HK$10,000 plus three times the tax undercharged under section 80(2).
What is the difference between year-end and monthly accounting?
Year-end is done once a year, costs least (from $900), but leaves you blind to cash flow all year, concentrates the work at the year end and risks vouchers being lost. Monthly costs more but surfaces problems in the month they arise and makes the year end far easier. The test: more than 30–50 transactions a month, inventory or receivables to track, or a bank or investor wanting regular figures — any one of these and year-end is no longer suitable.
Does monthly accounting include audit and tax filing?
Monthly accounting generally covers bookkeeping and statement preparation. Audit and filing are usually separate — Stepcon's audit arrangement from $2,000 (dormant companies, four years or more, per year) and profits tax return filing at $270. Note that a statutory audit must be performed independently by an accountant holding a practising certificate; the provider supplies arrangement and coordination.
Are outsourced accounting fees tax deductible?
Yes. Accounting, audit and tax filing fees are operating expenses incurred in the production of assessable profits and are generally deductible for profits tax, which lowers the effective cost further.
What are the commonest DIY mistakes?
Eight: mixing company and personal money; treating capital expenditure as a current expense; recording only the net platform payout (common in e-commerce); missing closing adjustments; using one exchange rate all year; carrying receivables and payables indefinitely; no year-end stock count; and forcing unreconciled differences into a sundry account.
Is there a half-and-half option?
Yes — the hybrid model: you handle day-to-day entry, scanning vouchers and exporting bank data, while the accounting team reviews, makes closing adjustments and prepares the statements. It lowers the monthly fee while keeping professional oversight, and suits owners with basic accounting knowledge who do not want to carry the judgement risk.
When should I switch from DIY to outsourcing?
Seven signals: more than 30–50 transactions a month; you now hold inventory; you have hired staff; you have several bank accounts or currencies; last year's audit produced many adjusting entries or a qualified opinion; you have filed late or received an estimated assessment; bookkeeping already takes more than 8 hours a month.
How much more does a poorly kept set of books cost at audit?
Audit fees follow the auditor's hours. Scattered vouchers, inconsistent classification, unreconciled bank accounts and receivables and payables without detail all add hours of sorting and questioning, and quotes can be 20–30% higher and take longer — and insufficient evidence may bring a qualified opinion. Audit fees for a typical trading SME run about HK$8,000–30,000, averaging around HK$9,000.
What size of company suits monthly accounting?
Other than micro or dormant companies with very few transactions, most trading start-ups and SMEs — particularly where the owner's time is valuable, transactions are increasing, or there is inventory or staff. Companies with very few transactions can start with the year-end plan (from $900) and move up to quarterly or monthly as volume rises.
A reasonable fee for expertise, accuracy and one less thing to worry about
DIY or monthly accounting is not simply a question of saving money. Put the three scenarios side by side and the picture is clear:
- Micro company (a dozen or so transactions a month): year-end accounting is the best value (about $3,200 against $8,000–11,700 doing it yourself)
- Start-up (about 40 a month): monthly and year-end are close, but monthly adds live cash flow visibility
- Growing company (about 70 a month, with inventory and staff): monthly accounting is clearly best (about $15,372 against $92,100–98,100 doing it yourself)
And in almost every scenario, doing it yourself has the highest total cost — because an owner's time was never free.
Stepcon Business Services works on the principle of lowering our clients' running costs, offering affordable, professional support across monthly accounting, SME bookkeeping, audit arrangement, tax filing and company secretarial work. Monthly accounting from HK$200, year-end from HK$900 — saving you money, time and compliance risk.
Want to know which plan fits your company? Get in touch: call 3687-1127 or message us on WhatsApp / WeChat at 9700-6312. Tell us roughly how many transactions you have each month and we will work the numbers with you, with a free consultation and an accurate quote.
