This is a question I hear quite often in the field. "Shouldn't we be using a firm like KPMG?"

When companies first come in for consultation, this is a question that executives often bring up.

Every time I hear it, I can't help but smile internally. This is because the conversation that follows is almost always the same.

If you use a Big Four firm like KPMG, the basic audit fees start at around $50,000 and can go up to $300,000. Additionally, typical tax consulting fees can range from tens of thousands to hundreds of thousands of dollars.

At that point, I see their expressions change.

It becomes a situation where accounting costs consume all of the net profit.

"It's more expensive than I thought..."

No, it's not just more expensive than you thought; that's how it is.

Let's be frank. The Big Four are not just upgraded versions of local accountants.

They operate in a completely different market.

They cater to publicly traded companies, large firms seeking investment, global structures, and companies that already have internal accounting teams.

So, it's not about "entrusting the books" but rather about "conducting audits, managing risks, and designing structures."

However, if a company with a few million dollars in revenue decides to go with them, it's not just a metaphor; it truly becomes a case of the tail wagging the dog.

Let me share a real case.

It was a company with about $7 million in revenue.

The executive was very enthusiastic. "We need to be systematic. We should go with a big firm."

So, they reached out to a Big Four firm. What was the number they received? Audit and tax combined came to around $80,000.

At that point, the game is already over. With a net profit of $300,000, spending $80,000 on accounting? That's not management; that's self-harm.

The problem is that the working methods are also different. The Big Four generally have long and detailed processes. A list of requested documents floods your email.

A company without a finance team can lose a week just trying to respond to that.

The executive ends up digging through Excel, employees are searching for receipts, and eventually, the moment comes when they think, "Why did we start this?"

From that point on, it becomes a stress management project rather than accounting.

On the other hand, from the perspective of a regional firm like ours, the picture looks a bit different.

We understand the situation of the executives. Revenue is increasing, but the organization is still small, there's no internal accounting team, and costs need to be minimized. So, we design just what is necessary, nothing more. If an audit isn't needed, we don't push for it. If the tax structure isn't complex, we keep it simple.

Interestingly, once a company surpasses a certain size, they eventually return to the Big Four.

This is a natural progression. Once revenue exceeds $50 million, investments come in, and overseas subsidiaries are established, we honestly tell them, "Now is the time for that." We don't hold them back unnecessarily. Instead, until that point, it's more important to grow efficiently.

Sometimes, there are those who say, "But doesn't using a well-known firm make investors happy?" That's true.

However, there is a timing to that. It's something you do right before entering the investment stage, when you're organizing your structure, not when you're still at a few million in revenue, as the cost-benefit ratio is too low. Investors are not fools. They look at the numbers, growth potential, and margins. They don't just look at the name of the accounting firm.

Ultimately, this is not a matter of choice but a matter of stages.

Companies have growth stages, and accounting needs to align with those stages. A small company trying to wear a big suit will be uncomfortable. Trying to look good can just slow you down. Speed is crucial in business, and if accounting costs hold you back, that's when the direction changes.

In summary, it's simple. Considering the Big Four for revenues between $10 million and $20 million is mostly excessive.

Once revenue exceeds around $30 million and things get complicated, then it's time to reconsider. Until then, efficiency, speed, and flexibility are more important.

Accounting is not about looking impressive. It's about making money.

The moment the tail wags the dog, that's already a wrong choice.

And many companies make such choices more often than you think. That's why we stay busy.