Should you be the “Financial Storyteller” to help clients navigate the future?
Accountants Minute 331
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Should you be the “Financial Storyteller” to help clients navigate the future?
Ask yourself – what did your firm do this past financial year to help your SME clients navigate the future?
The answer could well determine the future of your business.
Many accountancy firms are conservative and like to work in the past – the past 12 months that is.
They churn out the same old compliance forms for their clients year after year, hoping things will never change and praying their little gold mine will last forever.
All many of them do is to review what has already happened in their client’s business for the previous year. It’s as though they’re observers of history, not innovators.
No wonder their staff get frustrated.
Accountants servicing SME markets need to become “financial storytellers.”
Why?
Because many SME clients are babes in the woods. They need a storyteller to show them what the long-term results could be of the decisions they’re making today.
The “storyteller role” is no different to what happens in larger businesses, which have a Chief Financial Officer (CFO) on staff.
CFOs are generally very experienced accountants, who are privy to just about everything that’s happening within the business,
Drawing on that experience, a CFO can analyse the business’ current performance and project what is most likely to happen in the future. A good CFO can accurately project a company’s likely position out to 5 years, but in some companies, they go even further.
Your SME clients need more than the standard package:
- An annual set of accounts with a “consolidated profit and loss account,” but no breakdown of individual business units so they can see where improvements need to be made.
- A balance sheet that satisfies professional bodies and regulatory authorities, but doesn’t give the client any real understanding of their financial position.
- Taxation return.
- Tax payment summary.
In all honesty, how does this type of reporting help your clients to adequately plan and run their business operations?
SME clients are making hundreds, and in some cases, thousands of decisions each year relating to how they’re operating their business. These are decisions that affect not just what happens today, but what will happen in the future.
These decisions are often taking into consideration:
- capital expenditure;
- expansion/acquisitions;
- R&D;
- team recruitment and training
- exporting
- technology upgrades; and
- level of investment in stock and debtors.
- Sometimes, they may have to look at raising capital and this immediately brings in question “what’s the value of the business?” It’s not something that a layman can easily work out. If a company is going to issue shares for capital-raising, they’ve got to know how much their shares are worth to determine how many they’ll need to allocate.
- If they’re seeking additional loan funds, they’ll also need to know if their business has spare assets that can be offered as security.
If your accounting firm fits in that “conservative” mould, you may never have given any thought to those issues that confront many of your SME clients throughout the year. It’s why some of them have trouble sleeping as they wrestle each night with these ongoing problems. Often, they’re filled with doubt. Some are led to wonder whether it’s all going to be worthwhile or are they making a massive mistake. For many of them, business problems are a gigantic black hole!
Your role as the “financial storyteller” will help your SME clients to understand the impact, risks and potential benefits of their decisions. They need to know what the decisions they make today may look like in 5 years time.
Wouldn’t you like to be able to sit down and talk to your SME clients and say to them that you could offer them a “financial storyteller” role by becoming their virtual CFO? Most small and medium-sized businesses can’t afford a full time CFO, but many would love to be able to rely on your experience as a sounding-board for their decision-making.
We all know that changes occur in business every day – some come right out of left field.
High inflation hits - interest rates take off – supply chain issues - business results fail to meet expectations. Despite all this, if your SME client has a plan that you have thoroughly researched and diligently prepared, they’ll be in a far better position to respond quickly and confidently, than they’d be able to do without your assistance as their “financial storyteller.”
The ESS BIZTOOLS’ Financial Forecasting Product Package will assist you to deliver “three-way financial model” projections that the Banks now require for:
- Budgets – key drivers and individual budget forecasts
- Cash Flow Forecasts
- Projected Balance Sheets
Interested in finding out how your firm could start the delivery of these types of “real accounting services” to your clients?
Why not visit www.essbiztools.com.au and review our material or call 1800 232 088 to make an appointment for a no-obligation Zoom meeting? As a highly-experienced accountant himself, our Managing Director Peter Towers will help you determine the best course for your firm to follow.
Would you like to win a holiday?
To go into a draw for a complimentary holiday package, click here to enter.
The winner will be drawn on Wednesday, 28th September 2022 via live broadcast on LinkedIn, Facebook or Youtube (look up “ESS BIZTOOLS”) Good luck!
Grand Final Promotion
For a limited time, ESS BIZTOOLS is offering you a complimentary holiday accommodation package to new subscribers.
You can enjoy a 4-day/3-night stay in a wide range of idyllic destinations throughout Australia. Simply subscribe to one of our packages (paid 12 months upfront or in 4 equal monthly installments) to claim.
Every new subscriber to one of our product packages receives a complimentary holiday accommodation package:
- Starter Package
- Advanced Package
- Financial Forecasting Package
Click here to find out more.
Accounting News
Will your accounting firm survive the downturn?
Could you handle more business this year?
Well, whether you could or couldn’t, chances are pretty high that you probably wouldn’t like the idea of handling less. Yet, for many businesses, “less” could be the reality over the next year.
It’s often hard to tell businesspeople, who have been operating successful businesses for many years, that they need to start keeping in touch with their client base.
That message doesn’t always sink in.
It’s especially true for accountants who expect their clients to just keep coming back automatically year after year.
With tough times ahead, you need to get talking to your clients before your competitors get in their ear.
Accountancy could soon become a price-based dog-eat-dog world, unless you can convince your clients that you have something special to offer them.
A simple way to start the conversation is with an e-newsletter – it’s basic, it can be personal and it’s inexpensive to produce.
There are many more sophisticated and expensive ways of communicating with your clients and potential clients …. but an e-newsletter is a good way to dip your toe in the water.
If you don’t believe that then you should take note of the 83% of American businesses that are already using e-newsletters rather than plain text.
Do yourself a favour. Click here to download the brochure now. It makes good reading and you may find that it could work for you.
Business Plus+
The ESS BIZTOOLS’ Business Plus+ newsletter, prepared monthly except January, helps our accounting subscribers communicate with their clients and prospects.
Want to know what’s included in the Business Plus+ newsletter? Let us give you a preview…
One of our recent article, “9 Steps to Create Financial Forecasts”, is available. You are most welcome to use this article to communicate with your clients and prospects. Click here to download the article.
Sole traders, partners and independent contractors are being left out in the cold when it comes to technology and training
They want to know why they’re being discriminated against in a new Bill affecting SMEs.
A revived federal government initiative now gives an SME company a 120 per cent tax deduction for the training of its employees and for introducing new technology.
The scheme has understandably been hailed by business as a great incentive for small business, but drafting of the legislation has excluded certain types of businesspeople from claiming the benefit.
IPA General Manager Tony Greco says there’s no reason sole traders, partners in a partnership or independent contractors should be ineligible for the tax deduction.
Mr Greco says these types of businesspeople often spend money upskilling themselves only to find out they can’t make a claim.
The IPA says the legislation needs to be changed to stop this discrimination and allow for a wider range of training providers.
Mr Greco believes that the legislation should make permanent the provision that businesses with a turnover of less than $2M a year can claim the deduction.
Your SME clients could be failing simply because they can’t find staff
The Federal Government is now coming under attack for sitting on its hands.
Small businesses pinned many of its hopes on the so-called Jobs Summit to solve the lack of workers available Australia-wide to keep the sector running, only to be disappointed.
SMEs are the largest employers in the country, but since the Summit the sector has seen a dramatic increase in job vacancies – far beyond what they expected.
The Council of Small Business Organisations says the problem has been ongoing for over six months and they can’t wait for the federal government to produce a White Paper before taking any action.
Many small businesses are now limiting their operating hours and reducing their output of products and services.
More than 170,000 workers are needed to fill the jobs in the food supply industry alone.
With labour shortages, supply chain issues, increased interest rates and costs of doing business, many SMEs are now facing the question of whether they can afford to continue operating.
The ATO is back on the warpath following its collection hiatus during COVID
Many of your SME client directors could be personally liable for outstanding debts.
For the past two years, the ATO is has been fairly restrained in the way it’s conducted its recovery actions leading to a noticeable shortfall in the public purse.
The impact of COVID on small and medium sized businesses triggered a decision by the Morrison Government for the ATO to drop its aggressive approach to collecting outstanding tax payments.
Now the pandemic is all but over, it’s “game on” again.
The ATO is back issuing up to 120 Director’s Penalty Notices (DPN) each day.
DPNs allow the ATO to collect outstanding PAYG, GST and super payments from company directors personally.
The options for directors under these notices are limited.
They can pay the bill, if they can afford it, or liquidate the company.
Failure to do either could result in the ATO personally bankrupting them.
CSIRO’s Innovate to Grow: Defence Victoria/Tasmania
Is your SME client located in Victoria or Tasmania and working on innovations in the defence sector?
Do they have an innovative idea they want to turn into a research and development (R&D) opportunity? If so, you should encourage them to apply for Innovate to Grow: Defence Victoria/Tasmania.
This free 10-week virtual self-paced program, coordinated by CSIRO, will help them harness the power of R&D to turn an idea into reality. The program will assist your clients to refine their idea to make key contacts with CSIRO researchers, universities, domain experts, funding professionals and other SMEs.
Applications for this intake are open until Monday 3rd October 2022. The program commences on 17th October 2022.
To find out more and to apply, click here.
You’re also welcome to download a paper prepared by ESS BIZTOOLS, Paper 060-508 - CSIRO - Innovate to Grow - Defence - Victoria & Tasmania. Click here to obtain this paper.
Contractors surge at Defence amid workforce pressures
The number of external contractors working at the Department of Defence has grown by 55 per cent since the start of the pandemic, as the ongoing skills shortage takes a bite out of its internal workforce.
To read the full article from Innovation Australia, click here.
ESS BIZTOOLS has a paper, describing Defence Department Grants available for contractors, which our subscribers can access at any time.
WA maps ecosystem with startup database
Western Australia’s Minister of Innovation and ICT Stephen Dawson has launched an online platform documenting the state’s early-stage innovation ecosystem.
To read the full article from Innovation Australia, click here.
Research and Development Product Package
Let us help you help your SME clients!
ESS BIZTOOLS has developed a complete research and development product package to assist accountants to advise SMEs on research and development, including:
- 12 flowcharts to assist in explaining to clients how the R&D system operates.
- 12 papers explaining the R&D system.
- 52 forms to assist with processing the records required for the R&D journey.
To give you an idea on how you could utilise this package to assist your SME clients, we welcome you to click here to download some of the material that we’re offering, free of charge, which contains the following:
FC050 Planning a Research and Development Project
012-009 Research and Development Tax Incentive
BAS5514 Planning the Systematic Progression of Work
ESS BIZTOOLS – Podcast
Peter Towers, Managing Director of ESS BIZTOOLS, has presented a couple of podcasts. Click on your preferred podcast to listen:
Introduction to Virtual CFO Delivery
Why Research and Development is very important for SMEs
Latest Social Media Posts
ESS BIZTOOLS has presented a series of posts over the last week. Click on your preferred topic to access:
Research and Development - very important for SMEs
Cash flow forecasts are important!
Are you the financial storyteller?
Free Education Events
You are invited to participate in the following education events, free of charge. Click on your preferred event to register your attendance.
Financial Forecasting – Package of Services: Wednesday 28th September 2022 at 11.30am AEST
Offering Virtual CFO Services: Wednesday 5th October 2022 at 11.30am AEST (12.30pm AEDT)
Previous Education Event
Introduction to Virtual CFO Delivery was presented on 15th September 2022. You can access the webinar recording by clicking here.
Want to know more?
Visit www.essbiztools.com.au. You are also welcome to visit www.essbizgrants.com.au, a website that can assist in the identification of government grant(s) suitable for your clients.
If you would like to have a discussion about how this concept of virtual CFO services can be supplied by Australian accounting firms please ring our Managing Director, Peter Towers, on 1800 232 088 and we will arrange a complimentary 45 minute Zoom meeting to discuss your firm’s position and to give you our advice.
We believe that this is the blueprint for the delivery of an enhanced range of services by Australian accounting firms to assist SME businesses to add value to their businesses and to assist accountants not only to attract but to retain outstanding talent who want to be involved in the delivery of “real accounting services”.
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