Diversifying Accountancy Services – Why?
The survey undertaken by Accounting Market Pulse in May 2021 indicated that only 5% of the accounting firms that were surveyed reported that they “will not be diversifying services in the next few years”.
This is exciting news for supporters of the concept that professional accountants should be offering their broad range of expertise and training to assist SME clients in a variety of commercial applications, not just in compliance activities.
ESS BIZTOOLS has produced a white paper – Diversifying Accountancy Services – Why?
Our aim in producing the white paper was to explore the various issues that confront accountants, bookkeepers, business advisors and Chief Financial Officers that wish to offer a broader range of value adding services to assist SME clients to achieve their business aims.
In this article we are presenting a précis of the white paper.
1. What Are Your Firms Points of Difference?
One of the challenges confronting professional advisers is that, from an SME’s point of view, most accountancy firms look the same – the majority provide a service relating to the preparation of annual financial accounts and income tax returns for businesses, superannuation funds and individuals.
Some firms have ventured into diversification by creating industry specialities.
Within some of these industries some accountants have become “experts” because they have developed detailed knowledge of how these industries operate. They have “dug into the records and systems of those businesses” so that they are able to develop management accounting systems that contribute to the information that the management team receives to enable the leaders and all of the team members to better perform their role within the business.
2. Accounting Market Pulse
The CommBank report identified that a whopping 95% of the firms that participated in the survey will be diversifying services over the next 2 years and that the highest rating area for new products and services to be developed, as part of this diversification process, was “Business Advisory Services”.
3. Points Of Difference
What points of difference will the marketplace notice?
It could be from specialising within individual industries and examining the way that the key performance indicators could be better used within a business that an accountant becomes known as an “expert” in a particular industry.
4. Expert Status
To be seen as an “expert” an accountant needs to have developed a detailed understanding of how an individual business operates in a far greater depth than the knowledge that is normally accumulated from the preparation of annual financial accounts and preparing income tax returns.
Developing a reputation that a professional firm has an “expert” status, either for individuals within the firm – the “champions” or the firm as a whole, is a significant contribution to that professional firm developing a reputation that it offers a “diversified range of services to assist in adding value to their SME clients”, thus being a firm delivering “diversified accountancy services.”
5. Experience For Business Advisory Services
Accountants who wish to be involved in the delivery of “Business Advisory Services” need to develop an interest in various types of businesses so that they have a deeper understanding of those businesses.
6. Business Experience
From my experience of having been a Chief Financial Officer/Company Secretary of a stock exchange listed public company, I’m aware that many large companies organise themselves as a series of “small businesses” with a regional manager with an accountant or experienced office manager.
For each of these business units they prepare:
- Individual Business Unit Budgets
- Weekly Performance Reports
- Daily/Weekly Key Performance Indicators
- Monthly Financial Accounts
- Monthly Key Performance Indicators
- Monthly Comparison of Actual –v – Budget
- Hold a Monthly Business Review Meeting
I believe that these are the key services that should be provided each month.
Accountants need empathy for the problems that SME business owners and managers are facing. One of the biggest issues that CEOs have is normally articulated in a series of questions. I call these “what if” questions based on my experience of these from my public company career.
Most SME CEOs have the same type of issues confronting them – to whom do they ask their “what if” questions? The challenge facing accountants, servicing SMEs, is to have a clear understanding of the type of issues confronting their SME CEOs and to instigate a system so these questions are able to be answered every day. This is really supplying virtual Chief Financial Officer Services to your clients.
8. Communication Skills
Communication skills are very important for accountants who are wanting to deliver a range of diversified services to their SME clients.
9. Promotion/Marketing of Diversified Services
One of the challenges that accountants find is that there is not an instant recognition by clients and prospects that an accounting firm, which has primarily been involved in the preparation of annual accounts and income tax returns, is now able to supply diversified services, such as Business Advisory Services.
To overcome this problem, an accountancy firm, that has geared itself up by training the team to deliver Business Advisory Services, needs to undertake training relating to promotion and marketing of diversified services because many of your clients may not recognise that your firm is able to supply a broader range of services which have the potential of “adding value” to their businesses.
10. Promotion/Marketing Tools
The ESS BIZTOOLS’ package includes:
- The “Business Plus +” newsletter – a monthly newsletter that our subscribers badge and send to their clients and prospects – this is both a “marketing tool for accountants” and an “information resource for SMEs”.
- SME Needs’ Analysis assists accountants to have discussions by providing a list of questions to raise with your client to encourage them to have a better understanding of the commercial services that you can provide to them.
11. Diversified Services That Your Firm Could Communicate to Clients/Prospects
Some of the product packages that can be introduced shortly after commencing a subscription with ESS BIZTOOLS include:
- Tradies’ Charge out Rate Calculator
- Professional Service Firms’ Charge Out Rate Calculator
- Retailer/Wholesaler Analysis of Stock Mix and Markup Rates
- Delivery of “Virtual Chief Financial Officer Services”
- Assistance for clients who are keen to “Scale up their Businesses”
- Debtors’ Management Review System to assist in the reduction of debtors’ days outstanding
12. Assisting Clients on the “Innovation Journey”
One of the consequences of the COVID-19 lockdowns is that some of your clients could have been undertaking research activities and they may now be looking for guidance as to what they can do to enter the commercial marketplace with their new product, process or service. You could discuss:
- Formalising a research and development project so that your client can claim the Research and Development Tax Incentive Rebate.
- Applying for an Accelerating Commercialisation Grant to assist with the commercialisation process – a grant of up to $1,000,000.
- Considering the options to raise capital direct from the public either as an Early Stage Innovation Company or a Crowd Sourced Funding Equity Raising Company.
To undertake these items, your clients will need a Business Plan and Financial Forecast to be prepared.
If clients are looking to undertake capital raising, it also gives you an opportunity to discuss Virtual Chief Financial Officer Services with them.
13. Do You Want to Know More About Delivering Diversified Accounting Services?
We hope you said yes! You are welcome to visit www.essbiztools.com.au for a review of the product packages and for an overview of the “Special 50% Discount Packages” that we have available at present:
- Business Advisory Services Starter Package – 50% discount – your investment $999 (including GST) for 12 months access. (Click here to review)
- Advanced Package (previously known as Gold) (this package includes all of the ESS BIZTOOLS material, including access to ESS BIZGRANTS) – 50% discount – your investment $3,250 (including GST) for 12 months access. (Click here to review)
- Chief Financial Officer Service Package – 50% discount – your investment $1,375 (including GST) for 12 months access. (Click here to review)
- Innovation Package – 50% discount – includes Research and Development, Accelerating Commercialisation Grant, Early Stage Innovation Company Capital Raising Process and Business Advisory Services Training – $2,500 (including GST) for 12 months access. (Click here to review)
(Click here) to obtain a copy of the white paper.
For further information, please contact Peter Towers at ESS BIZTOOLS – 0418 190 181 or email firstname.lastname@example.org
“Business Advisory Services Implementation Training – Retail Pricing Calculator – Aligning Product Mixes and Mark Ups to Earn Targeted Profits” – Wednesday 25th August 2021 at 12-noon AEST. To register (click here).
“Business Advisory Services Implementation Training – Business Health Checks – Pharmacy and Supermarkets” – Tuesday 31st August 2021 at 12-noon AEST. To register (click here).