Your outside firms got faster with AI and you are still paying for the old hours. · VANDAM

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# Your outside firms got faster with AI and you are still paying for the old hours. · VANDAM

> Your law firm, auditor and agencies got faster with AI while invoices stayed the same. A CFO playbook to reprice per deliverable and renegotiate software.

URL: https://vandam.ai/notes/reprice-your-outside-firms  
Contact: hendrik@vibelab.be

# Your outside firms got faster with AI and you are still paying for the old hours.

Law firms, auditors, agencies and outsourcers are putting AI into the work they bill you for, and most contracts still price the old hours. KPMG showed how to ask for the saving back, and I set out the questions a CFO should send each supplier before the next renewal.

Hendrik De Winne 26 October 2026 9 min read

In 2025, KPMG International went back to its own auditor, Grant Thornton UK, and asked for a cut. The argument, as the [Financial Times](https://www.ft.com/content/c891c47c-b21f-4e0f-84b3-b80c794eff3d) reported in February, was that Grant Thornton was rolling out AI across its audit work and should share the savings. KPMG reportedly said it might look for another auditor if it did not. According to UK filings cited by [TechSpot](https://www.techspot.com/news/111237-kpmg-asked-own-auditor-discount-citing-ai-efficiencies.html), the fee for auditing KPMG International’s 2025 accounts fell from **$416,000** to **$357,000**, about **14%**.

KPMG sells audits for a living. It knows better than almost any buyer what AI does to the hours inside one, and it used that knowledge as a client. A mid-sized company typically pays a law firm, an audit firm, a tax adviser, agencies and an outsourcer, and all of them are putting AI into the work they bill you for. Very few of those contracts have changed.

The part a CFO may not see from the invoice is who decides where that saving goes. Under hourly billing the supplier decides, quietly, matter by matter. A firm that does ten hours of work in five can bill five hours at a higher rate, bill eight, or move you to a “value-based” fee set by what the work is worth to you. Each of those keeps most of the saving at the supplier. You only get a share if you ask for one, and the best time to ask is the next renewal.

## Your suppliers’ costs fell before your invoices did

The legal market shows the gap most clearly. The [2026 Report on the State of the US Legal Market](https://www.thomsonreuters.com/en/institute/reports/state-of-the-us-legal-market-2026), from the Thomson Reuters Institute and Georgetown Law, found that the average US law firm grew profit **13%** in 2025 while worked rates rose a record **7.3%**. It also notes that “90% of legal dollars still flow through hourly billing arrangements that may no longer reflect the value delivered,” despite heavy AI investment.

The clients have noticed. In October 2025 the [Association of Corporate Counsel and Everlaw](https://www.acc.com/about/newsroom/news/acc-genai-report-corporate-law-departments-ai-use-everlaw) surveyed 657 in-house legal professionals in 30 countries. Nearly 60% reported “no noticeable savings yet” from their outside counsel using generative AI. Asked why, 58% said law firms have not adjusted pricing to reflect the efficiency. And 59% did not know whether their law firms used generative AI on their matters at all.

- **90%**
  Share of US legal dollars still billed by the hour, per the [Thomson Reuters Institute](https://www.thomsonreuters.com/en/institute/reports/state-of-the-us-legal-market-2026), January 2026.
- **58%**
  In-house lawyers who say firms have not adjusted pricing for AI, per [ACC and Everlaw](https://www.acc.com/about/newsroom/news/acc-genai-report-corporate-law-departments-ai-use-everlaw), October 2025.
- **59%**
  In-house teams that do not know whether their law firms use AI on their matters, same survey.
- **14%**
  Cut in KPMG International’s audit fee after it asked for AI savings, per the [FT](https://www.ft.com/content/c891c47c-b21f-4e0f-84b3-b80c794eff3d).

The size of the possible saving is still an estimate. Clio, which sells practice software to law firms, writes in its [Legal Trends research](https://www.clio.com/blog/death-of-the-billable-hour-legal-ai/) that as much as **74%** of billable work could be automated with AI. That is a vendor’s estimate of potential. Thomson Reuters’ [Future of Professionals](https://www.thomsonreuters.com/en/press-releases/2025/june/the-ai-adoption-reality-check-firms-with-ai-strategies-are-twice-as-likely-to-see-ai-driven-revenue-growth-those-without-risk-falling-behind) survey of 2,275 professionals in 2025 is more modest: respondents predicted that professionals using AI will save **5 hours** a week within a year. That is more than 10% of a working week, on work you pay for by the hour.

## The firms are already asking who keeps the saving

The accounting firms say this openly. In March, [Bloomberg Tax](https://news.bloombergtax.com/financial-accounting/ai-efficiency-gains-push-accounting-firms-to-reimagine-pricing) asked partners at KPMG, PwC and RSM how AI changes what they charge. RSM, which focuses on mid-sized companies, gave a concrete example: a tax advisory report that took a team 20 hours could take 10 with generative AI and a human check of the output. Sergio de la Fe, the RSM partner who leads its enterprise digital work, put the dilemma in one question.

Is that all margin for me or is that all price reduction for our client? (Sergio de la Fe, partner at RSM US, to [Bloomberg Tax](https://news.bloombergtax.com/financial-accounting/ai-efficiency-gains-push-accounting-firms-to-reimagine-pricing), March 2026)

His answer was that RSM can cut prices in some areas and not in others. PwC’s US tax leader, Krishnan Chandrasekhar, told the same reporter that “time’s becoming less and less of relevance,” and described pricing some work on the value the client ascribes to it. KPMG’s Rob Fisher called value-based pricing “incredibly important” and pointed out that AI tooling is a cost that is hard to attribute to individual projects. RSM announced a **$1 billion** AI investment over three years, so the firms have real costs of their own to recover.

Agencies are further along, and some founders say so in public. [Jake Ward](https://x.com/jakezward/status/2044762030758928467), who owns an SEO agency, described the shift in April: the old model was an “Army of humans” at “30% margins,” and the new one is “One person does the work of seven” at “75%+ margins.” Those are his own figures, posted to promote the model, so I read them as a claim. They still tell a buyer something useful. The agency on the other side of that post keeps selling “the outcome on a monthly retainer,” and the retainer was priced when the work took seven people.

## Value pricing set by the supplier keeps the saving there

Every one of these firms is moving away from the hour, which sounds like what the client wants. The detail that matters is the anchor. A value-based fee is set by what the work is worth to you, and that number did not fall when the hours did. If the firm proposes the new price, it will start from the old invoice.

The buyer’s version is a price per deliverable anchored to what the deliverable used to cost, with an agreed share of the saving coming back each year. A fixed fee for each NDA, each quarterly tax provision, each monthly paid-search report or each processed invoice. The supplier keeps the upside from getting faster, which gives it a reason to keep using AI. You get a lower unit price and a clear definition of done.

The rule we use: take the average cost of one deliverable over the last twelve months as the ceiling, ask for 20 to 40% of the estimated saving back in the first year, and write in a review of the price every twelve months. The exact share is negotiable, as long as the contract states one.

## Software renewals are the same negotiation

The same logic applies to the software line, from the other direction. Zylo, which sells SaaS management software, says in its [2026 SaaS Management Index](https://zylo.com/blog/saas-usage-numbers) that the average organization uses **54%** of the licenses it provisions. Its [report page](https://zylo.com/reports/2026-smi/) adds that 78% of IT leaders reported unexpected charges tied to AI features or consumption-based pricing. Those are figures from a vendor that profits when you worry about waste, so treat them as indicative.

What has changed is the buyer’s alternative. When [Greg Isenberg](https://x.com/gregisenberg/status/2105397216374403561) read Google’s September announcement that its agents were rewriting old C and C++ code, he wrote: “There are PLENTY of companies stay with outdated software vendors only because switching is painful, and once rewriting is cheap, that lock in starts to break!” A tool that 20 people use for a tenth of its features can now be rebuilt internally or swapped for something cheaper, and the vendor’s account manager knows it. I made the general build-or-buy case in [the note on Coase and the firm](https://vandam.ai/notes/coase-and-the-firm). At renewal, it becomes a specific number: what replacing this tool would cost you.

Keep the systems of record out of this. The ERP, the general ledger, the CRM and the HR system are what your agents will read from and write to, and they get more valuable as agents arrive. The candidates are the seat-priced tools on top.

## The questions to ask each type of supplier

These are the questions I would send before each renewal, in writing, with a request for written answers.

**Law firms.** Which tasks on our matters do you now do with AI, and with which tools? How has the time per task changed for contract review, first drafts, research and discovery since 2024? Will you quote a fixed fee per standard contract, per NDA and per routine filing, based on last year’s average? What is your policy on billing hours an AI tool did not need? Who reviews AI output before it reaches us?

**Audit and accounting firms.** Which audit procedures now test the full population with automation, and which still sample? How many hours did last year’s engagement take, by phase, and what do you expect this year? What share of the efficiency is reflected in the fee? For tax and advisory work, will you price per return, per provision and per memo? Auditors have to stay independent and the quality bar is set by regulators, so frame this as a fee conversation and leave the audit scope to them.

**Agencies.** Which deliverables are now produced mainly by AI with a person checking them? How many people work on our account today compared with when the retainer was set? Will you price per deliverable or per result we can count, such as qualified leads, published pages or campaigns live? Who owns the prompts, templates and tools built on our account if we leave?

**Outsourcers and managed services.** For BPO, IT support or managed finance: what share of tickets, invoices or transactions is now handled without a person? Will you move from per-FTE pricing to a price per resolved ticket or processed document, with a quality floor? What service levels change, and what happens to the price when automation rises next year?

**Software vendors.** How many of our seats were active in the last 90 days? Can we drop to the active count at renewal? What AI features are now bundled into the price, and can we decline them? What would it cost to leave, including data export?

## Where this can go wrong

Pushing price without watching quality is the obvious risk. In October 2025, [the Associated Press](https://www.news4jax.com/business/2025/10/07/deloitte-to-partially-refund-australian-government-for-report-with-apparent-ai-generated-errors/) reported that Deloitte would partially refund the Australian government for a A$440,000 report with incorrect references and a fabricated quote. The revised version disclosed that Azure OpenAI was used in writing it. A price per deliverable needs a definition of an acceptable one, a right to reject, and a clause requiring the supplier to disclose AI use on your work. ACC’s 59% figure suggests most contracts have none of these.

The second risk is squeezing a supplier you depend on. The firms are spending heavily on AI, and Grant Thornton told the FT, as TechSpot quoted it, that its fees “reflect both the cost of our people and the cost of the technology that supports them.” That is fair. A share of the saving is a different request from all of it, and a supplier that keeps some of the gain will keep investing in getting faster.

The third is doing this before you know your own numbers. If you cannot say what one contract review or one monthly report cost you last year, the supplier sets the anchor. The unit-cost discipline from [the note on pricing AI per finished task](https://vandam.ai/notes/cost-of-the-i) applies to outside firms as much as to your own AI budget.

## What a CFO can do this quarter

Pull the last twelve months of spend with outside firms and software vendors, and rank the suppliers by total. Put every contract over $50,000 on one renewal calendar with its notice date. For the top ten, count the deliverables you received and divide to get a cost per deliverable. Send each of them the questions above, adapted to the supplier type, at least 90 days before renewal. Then choose three contracts, one firm, one agency or outsourcer and one software tool, and convert them to a price per deliverable with a stated share of the saving and an annual review. The quarter after that, you will know which suppliers are sharing the gain and which are keeping it.

## More notes

29 October 2026 6 min read

## Who owns what your AI learns.

Y Combinator now asks for startups that help companies own their intelligence. Before a mid-sized company owns a model, it can own the four things every model works with: context, evals, rules and connections.

26 October 2026 9 min read

## Delete the step first and give the agent whatever survives.

Musk’s five-step method puts automation last, and most AI programs start there because an agent is the one step a vendor can sell. I walk accounts payable through the steps in his order and show why an agent that clears exceptions fast hides the steps that should go.

## Your agents need a critic and so does the plan they carry out.

Models grade their own work too kindly, and the labs now separate the agent that makes from the agent that checks, the way finance separates maker and checker. I set out a four-layer review design with a minutes budget, and why the brief itself needs a critic with no stake in it.