How Accountants Gain From Business Advisory Services

Let’s start today with a snap quiz!

Did you read last May’s Accounting Market Pulse report and seriously think “maybe our accounting firm should be offering those Business Advisory Services to our clients?”

Have you done anything about it?

Perhaps, you may still be thinking about how you’ll introduce those Business Advisory Services to your accounting team so they’ll be up to speed when you finally start talking to your clients.

If you’ve given it serious thought, then I’m sure there’ll be plenty of times when you’ve doubted whether the process of offering a broader range of commercial services to your SME clients was going to be worth the effort.

One thing you’ll have realised along the way is that it’s going to take a lot of time and a lot of work.  But, don’t give up, it’s not as hard as it looks because there are ways to work smarter, not harder.  I’ll tell you about that later.

So, let’s go back to the beginning.

The Accounting Market Pulse Report indicated that only 5% of the accounting firms they surveyed said that they “would not be diversifying their services” during 2021 or 2022.

That meant a massive 95% of accountancy firms from around Australia and of all shapes and sizes had come to the realisation that they needed to “diversify their client services”.

Clearly, providing Business Advisory Services to clients would feature strongly in the diversification plans of both large and small accountancy firms.

What can your firm gain by diversifying into Business Advisory Services?

Happier accounting team members

Last December’s Accountants Daily noted that “70% of employed accountants were evaluating their employment prospects elsewhere”.  In other words, they weren’t satisfied with the job they were in and were ready to jump ship!

Often, this is because most experienced accountants constantly are on the lookout for greater challenges to provide the job satisfaction they need.  They want more interesting work to tackle rather than the continual rollout of taxation compliance.  And, with close to full employment these days, experienced people know they’re always in demand.  Maintaining employee satisfaction and morale in your firm is critical, unless you want to be constantly recruiting.

In October 2021 the Australian Financial Review reported that 95% of companies that approached Crowd Sourced Funding Intermediaries for approval to raise capital were rejected. Why?  Because primarily, these companies did not have a detailed understanding of how Crowd Sourced Funding Equity Raising operated, nor did they have the required documents properly prepared.

We suspect that these companies’ accountants had not told them that they could supply the professional services needed to help small and medium sized businesses raise capital as a Crowd Sourced Funding Equity Raising Company.

If they had, these applications would have provided some employed accountants with very interesting and challenging work!

Firms, which are able to provide their accounting teams with a ready supply of high-level challenging assignments, will find that it’s far easier to hold current staff and to attract new recruits in the future.  People love to work for innovative companies with a great reputation.

According to benchmarking.com.au “accountancy fees” amounts to approximately 96% of the average accounting firm’s income.  Of the remainder, about 2% relates to financial planning and the balance refers to as “other income,” which presumably includes their current business advisory services.  Some firms have indicated that their aim is to achieve a 50-50 split between compliance and non-compliance work.  If this is to become an accounting industry target in the future, then for most firms, there’s certainly a long way to go.

Those practices that are prepared to diversify into Business Advisory Services will not only develop closer working relationships with their clients, but will begin to see premium streams of revenue flow from these enhanced services.

By undertaking these new activities, your firm will develop a reputation for being progressive and innovative.  You’ll be creating a group of very talented finance executives who can confidently “talk the talk” on a wide range of business activities.  This experience can be put to use developing value-added services that’ll benefit many of your SME clients.

Most small or medium-sized accounting firms could offer a range of diversified services that include:

Business Plans and Strategic Targets

• Predictive Accounting Reports comprised of Budgets, Cash Flow Forecasts and Projected Balance Sheets. Those projections could be prepared for one year or even looking ahead a number of years. Predictive accounting reports illustrate in financial terms what the strategies within the Business Plan are showing.
• Business review meetings with clients could be held on a monthly or quarterly basis, with you, their accountant, facilitating.
• Cash flow management reviews to show clients how they can reduce “Debtors Days Outstanding”. Safeguards can also be put in place for the business to reject reimbursement claims from liquidators or receivers under the Personal Property Securities Register Legislation.
• With the ESS BIZTOOLS Tradie’s Charge-out Rate Calculator key business components can be used to establish realistic charge out rates. These rates are based on the estimated productivity of individual team members, mark-ups on external purchases for the benefit of clients, and business overhead costs to ensure that the targeted profit is earned for the year.
• Retailers and wholesalers often need help in analysing their product mixes, some of which have a wide variety of mark-ups applicable to them. With your professional advice to help them find the right product mix/mark-up percentage approach, your client’s business will be on track to earn their targeted profit for the year

The Research and Development Tax Rebate is a great incentive for small and medium sized businesses.  But, that’s only if your clients’ business records comply with the legislation.  Company directors need to be ‘schooled’ in the Research and Development Legislation, so that if their company has undertaken Research and Development activities they’re able to claim the full tax benefit.  This information needs to come from someone they know and trust, and who better than their accountant?

So far, we’ve highlighted the benefits for your in-house team who’ll be tackling new and meaningful work, and for your clients who’ll see improved business operations and efficiencies.

The third group to consider is your accountancy firm.

How will you benefit from offering Business Advisory Services?

Your practice will benefit significantly from the renewed enthusiasm and boosted morale of your accounting team when you tell them that they’ll be involved in building an entirely new phase of the business.

Many of them will embrace the idea of becoming “Product Champions,” specialising in targeted areas of these Business Advisory Services.

Most of your clients too will appreciate that you’ve invested in “allied skill areas” and are able to offer services which will help them operate more efficiently and add value to their businesses.

Of course, there’ll be the financial rewards for your practice as well, as new revenue streams arise from providing these enhanced professional services.

If you’d like to know more about how you can help to steer your clients to greater success by providing Business Advisory Services visit www.essbiztools.com.au where you can review the services that we, at ESS BIZTOOLS, provide to accountants all over Australia.

You could also join us for our free webinar – “How Accountants gain from Business Advisory Services” that we, at ESS BIZTOOLS, are presenting on 13 April 2022 at 12.00pm AEST. To register please go to www.essbiztools.com.au/webinar registration.

If you would like to receive a complimentary copy of “Why Your Accounting Firm Must Begin to Offer Strategic Business Advisory Services to Clients” Click Here

ESS BIZTOOLS new SME offering includes our “Innovative Product Packages” which have been developed to support accountants as they start diversifying their operations into more interesting and lucrative “Business Advisory Services”.

You can view the details of the components of the “PREPARATION PACKAGE” or the “STARTER PACKAGE” by going to our website www.essbiztools.com.au

Please note: We’ve recently changed the way we charge offering easy monthly subscriptions and no locked-in contracts.

If you’d like to join many other accountants preparing to diversify, please complete our subscription form.  You will find it on our website under “Subscribe – Sign Up Here”.

Then in “Grouped Product Packages” you will have two choices:

• BUSINESS ADVISORY SERVICES STARTER PACKAGE

   $197 per month including GST

Or

• BUSINESS ADVISORY SERVICES PREPARATION PACKAGE

$129 per month including GST

INTERESTED IN OUR SOCIAL MEDIA POSTS/VIDEOS?

• SME News Analysis – A New Way to Provide Enhanced Business Services – click here to read the article or click here to watch the video.
• SME Needs Analysis is a Reference Tools – click here to read the article or click here to watch the video.
• Helping SMEs in Difficult Times – click here to read the article or click here to watch the video.
• Backing your Professional Advice – click here to read the article or click here to watch the video.
• Achieving Business Advisory Services Expert Status – click here to read or click here to watch the video.

WEBINAR PROGRAM FOR THE NEXT 3 WEEKS

We are presenting a series of FREE webinars – if you wish to attend please register.

• How Accountants Gain From Business Advisory Services
  Wednesday, 13 April 2022 at 12.00pm AEST.  Please click here to register.
• Services that Small/Medium Accountants Could Provide
  Wednesday, 20 April 2022 at 12.00pm AEST.  Please click here to register.
• Predictive Accounting – Your Clients Need These Services!
  Wednesday, 27 April 2022 at 12.00pm AEST.  Please click here to register.

Perhaps you missed out last webinar “Getting Ready to Deliver Business Advisory Services”.  To view the recording, please click here.

If you would like to see how your accountancy firm can introduce Business Advisory Services and start generating additional revenue, go to our homepage and click on “Free Strategy and Demonstration Session”.

Alternatively, if you’d like to discuss your options, that’s fine too.

Please call us on 1800 232 088 so we can arrange a no obligation Zoom meeting to talk over the strategies and benefits for your firm.

Stay safe!  Have a great week.