The 85% Advisory Gap in Accounting Firms

Why 85% of Firms are Not Delivering Advisory Services – And What the Leading 15% Are Doing Differently

There is a significant shift happening in the accounting profession — and it is being driven by your clients.

According to the Intuit QuickBooks SMB Navigator Report 2025, only 15% of SMEs see their accountant as a Key Strategic Partner.

“They are a key partner in our business and our ‘go-to’ professional for advice, and they are extremely valuable to our business’s growth and success.”

That means 85% of SMEs do not see their accountant this way.

At the same time, research highlighted in Accountants Daily, based on interviews conducted by insolvency expert Eddie Senatore, revealed that:

75% of accountants believe they are already acting as trusted advisors

This is not a small gap.

It is a massive disconnect — and a massive opportunity.

The Real Question: Why Is This Happening?

It’s easy to assume the problem is:

❌ Lack of technical knowledge
❌ Lack of tools
❌ Lack of client demand

But the reality is very different.

❌ It’s NOT a knowledge problem

You already understand:

✅ Financial statements
✅ Cash flow
✅ Business performance

It’s NOT a tools problem

There are more tools available than ever before — including structured advisory systems like ESS BIZTOOLS.

It IS a decision problem

Many firms are waiting: “We’ll start advisory when we have time.”

But here’s the truth:

That time never arrives.

The Deeper Issue: You’re Not Hearing the Real Questions

Your SME clients already have advisory needs.

They are thinking:

❓ “Can you help me understand if this business idea will work?”
❓ “What happens to my cash flow if I hire more staff?”
❓ “How do I actually run this business — not just report on it?”
❓ “Can I call you when I need advice — not just at tax time?”

But many don’t ask.

Why?

Because they believe:

“My accountant handles tax… not business decisions.”

Meanwhile… SMEs Are Struggling

This is not theoretical.

Across Australia:

❗ Over 2 million SMEs are operating
❗ More than 50% are not profitable
❗ Many business owners earn less than an average wage

The reality is confronting.

Tax compliance alone does not help a business survive — let alone grow.

What Happens Inside a Business That Gets It Right?

Think about a business that employs a full-time accountant.

The owner (the “Boss”) doesn’t just ask for reports.

They ask:

❓ “What if we expand into a new market?”
❓ “What will this decision do to our cash flow?”
❓ “Can you model the financial impact before we commit?”

That accountant is not just reporting history.

They are:
✅ Interpreting
✅ Advising
✅Challenging
✅ Guiding decisions

That is advisory.

And today — with technology, cloud systems, and communication tools — you can deliver that same experience virtually to your SME clients.

The Opportunity: Become the “Go-To” Advisor

Your clients don’t need more compliance.

They need:

✅ Financial clarity
✅ Forward-looking insights
✅ Regular conversations about decisions
✅ Someone they can call when it matters

And the truth is — there is no one better positioned than you to deliver this.

So Why Aren’t More Firms Doing It?

Because many are trying to answer the wrong question: “How do I build a full advisory division?”

Instead of the right one: “How do I start one advisory conversation?”

The Turning Point: Start Small. Start Smart.

Advisory services don’t begin with a restructure.

They begin with:

✅ One client
✅ One conversation
✅ One insight
✅ One measurable outcome

From there:

✅ Confidence grows
✅ Capability develops
✅ Revenue follows

From Compliance Provider to Key Strategic Partner

To bridge the 85% gap, firms must shift from:

Preparation → Participation

From: Reporting the past

To: Shaping the future

From: Being a service provider

To: Becoming a Key Strategic Partner

How ESS BIZTOOLS Helps You Get There

This is exactly why ESS BIZTOOLS exists.

Not theory.
Not vague concepts.

But practical systems, tools, and training you can use immediately with your clients.

Inside the Starter Package and Advanced Package, you’ll find:

✅ Business advisory frameworks and workflows
✅ Budgeting, forecasting, and cash flow tools
✅ KPI analysis and monthly management reporting systems
✅ R&D and government grants guidance
✅ Charge-out rate calculators and pricing tools
✅ Business planning and valuation resources

These are designed to help you:

✅ Start advisory conversations with confidence
✅ Deliver real value to clients
✅ Build recurring advisory revenue

The Reality — And The Opportunity

Right now, most firms are still in compliance mode.

But the firms that act now will:

✅ Strengthen client relationships
✅ Differentiate in a crowded market
✅ Create new revenue streams
✅ Be recognised as Key Strategic Partners

Don’t wait.

Don’t overthink.

Don’t aim for perfection.

Start now.

Because advisory services are not bought.

They are demonstrated — one conversation at a time.

Ready to Begin?

If you’re serious about becoming your clients’ Key Strategic Partner, we invite you to start the journey with ESS BIZTOOLS.

FIND OUT MORE AND SUBSCRIBE HERE

Visit our website – www.essbiztools.com.au – to discover the detailed overview of the services provided by ESS BIZTOOLS. You are also welcome to contact us on 0418 190 181 or email .

Unspoken SME Questions

These are the questions your SME clients are already thinking about—but rarely ask.

Not because they’re unimportant… but because they’re unsure whether your services extend beyond taxation.

And that’s where the opportunity lies.

These questions can help you open the door to meaningful conversations with clients who are ready for more—more clarity, more insight, and more guidance beyond compliance.

Please do not hesitate to send us your thoughts, questions or comments.

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Do you ask clients what additional services they would like to receive from you?

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I know there is terminology referred to as “markup percentage” and “gross profit percentage”. Can you explain the definitions and how the terminologies are used?

Could you prepare a short seminar with my team to explain how you use these terminologies? I suspect that someone was using the wrong one recently because our prices were very low.

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You sent me a note about “financial health”. I have enough problems with my own health – what do you mean by “financial health”?

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I have some calculations/data that a lady in my office prepares each day on visitors, customers, sales, gross profit percentage, yields, waste. Could you design a summary report so that I can quickly view this data every day and hopefully variations will stand out like the proverbial? I think this would help me.

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Could you prepare a Financial Position Report as if it was going to a Board of Directors meeting every 3 months? What information would you include in that report? What benefits do you think that I would obtain from that type of report and what benefits would my key people get from that information?

I got this idea from a discussion I had with a chap that I was playing golf with who is the CEO of a fairly large business. And he told me had to go back to his office as soon as we finished playing golf (no time for a beer after the game) to read the company’s Financial Position Report prepared by the company’s internal accountant. He has a Board of Directors meeting later in the week and he had to write a covering email to go with the Financial Position Report that afternoon, because directors have to receive board reports at least 3 days prior to the meeting. He seemed to take it very seriously. He told me that his company has a Board of Directors meeting every month. Would it be beneficial for me to receive the Financial Position Report each month?

Is it a legal requirement for companies to forward reports to directors 3 days prior to a meeting or would that just be his company’s policy?

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I don’t really understand the financial accounts that I currently receive from you every 3 months for the BAS returns. Could you meet with me and interpret what the figures are telling us?

When I think about it, I’m running a number of separate business activities and everything is in the one profit and loss account. One of my mates at golf said to me that he has 6 profit and loss accounts because he is operating 6 separate businesses and that this was suggested by his accountant.

Would it be better for me if had a profit loss account for each activity? What benefits would I get from this process?

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I’ve never told you before, but I was very helpful to our major supplier years ago when he had a very troublesome problem and he told me he would give me an ongoing discount of 25% on our purchases for as long as he ran the business.

This gentleman is not very well at present, and that made me start thinking about the advantage that we have in the marketplace because of this significant discount.

I don’t get on with his son and he will probably not continue with this arrangement, which I know from his body language he is not very happy about, but he doesn’t know the real reason that his father is been generous to me.

I’m worried about what will happen when he passes because the son does not like me, and probably will not continue with the special arrangement.

What effect will this have on my business? What strategies could we implement to try and soften the effect of not receiving that special discount?

Free Webinars by ESS BIZTOOLS

Why 85% of Firms are Not Delivering Advisory

📅 Friday 17 April | 11am AEST - REGISTER HERE

Why Firms are Struggling to Attract Accountants

📅 Friday 24 April | 11am AEST - REGISTER HERE

From Compliance Firm to Virtual CFO Firm

📅 Friday 1 May | 11am AEST - REGISTER HERE

Want to know more?

Visit www.essbiztools.com.au.

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 0418 190 181 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 and Bookkeeping firms to assist SME businesses to add value to their businesses and to assist accountants and bookkeepers 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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