• Register
Return to: Home > News > Tax > Fee pressure strikes firms in Spain

Fee pressure strikes firms in Spain

New tax and accounting rules in Spain have come at the worse possible moment, according to the International Accounting Bulletin’s Spain survey (see Spain survey:Firms prepare for challenges ahead).

Firms are experiencing increased workloads as clients comply with a new General Accounting Plan (Plan General Contable – PGC) introduced in January last year and new related party tax rules introduced in February this year. However, clients are in survival mode and resisting fee increases.

Fee income from UHY Fay & Co’s audit and consulting business remained static in the past year, while it should have grown.

“We have been trying to collect more fees thanks to [the PGC] because it requires a lot more advice to clients,” managing partner Bernard Fay said. “But the funny situation is that clients are not accepting increases in fees right now. They want to include everything in whatever has already been agreed.”

The PGC takes Spanish accounting standards for non-listed companies a step closer to IFRS and companies need to upgrade accounting processes and train staff.

Moore Stephens Hispania international liaison partner Jorge Blanquer said work is flowing from both the PGC and new related party tax rules, but the timing is unfortunate.

“If you are an entrepreneur/owner of a company, the main point now is to survive and accounting and bookkeeping stuff is secondary,” he said.

The implementation of new regulation is made more difficult because some accounting rules are still being developed by regulators. Many points are unclear and new interpretations are arriving from regulators almost daily, Blanquer said.

The benefits of the PGC on BDO Audiberia Auditores’s bottom line have also been tempered by fee pressure but the firm’s president, Alfonso Osorio Iturmendi, said fee pressure is good for BDO.

“Our cost structure, personal costs and general costs are lower than all the larger groups, so we are in a very good position to be more competitive than the rest of our competitors in the market,” he said. “In many cases we have to reduce our fees to be competitive in the market. But generally speaking I think it is a very good opportunity for a firm like BDO.”

Top Content

    MSI joins AGN and DFK in Global Connect

    A year after AGN International and DFK International launched Global Connect, multi-disciplinary association MSI has joined the group.

    read more

    Views from the Eurozone

    With Brexit looming, populist governments gaining footholds in a number of countries and movements such as the Yellow Jacket protests in France, 2018 was anything but a quite year for the eurozone. Here leaders report to the IAB on their markets.

    read more

    Eastern promise and how to find it

    With China rising as a global power, Jonathan Minter spoke with ShineWing’s Zhang Ke and Marco Carlei at the World Congress of Accountants 2018 in Sydney, to discuss the cultural challenges that occur when Chinese networks look beyond their border, and the dividends available for those who overcome them.

    read more

    The UK: uncertain waves rule Britannia

    The UK’s accountancy profession is currently in a period of much uncertainty. The Competition and Markets Authority (CMA) has released its review into the listed audit market which could cause the biggest shake-up the profession has seen in years, the Kingman Review has described the Financial Reporting Council (FRC) as not being fit for purpose and called for it to be replaced. All the while the country remains in a deadlock on Brexit negotiations.

    read more
Privacy Policy

We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.