Differentiation Can Be Very Rewarding - Offering Research & Development Services Helps!

Accountant's Minute 265

“Research and development services can help an accounting firm to differentiate itself in a market that, from a business operator’s perspective, most accountants look very similar” said Mark Holton, Director, Smithink Pty Ltd.

Research and development can be just as important as:

  • board of advice strategies;
  • business review meetings; or
  • assistance with raising capital as a Crowd Sourced Funding Equity Raising Company or an Early Stage Innovation Company

in differentiating the accountancy firm from competitors in the marketplace.

“To offer research and development services, accountants need to improve their knowledge of how the Australian Research and Development System operates and to have a clear understanding of the legal requirements for a company to be able to claim the Research and Development Incentive Rebate”.

“ESS BIZTOOLS has developed a Research and Development Product Package which gives accountants training in this very important area for individuals and businesses that have commenced researching a particular product which they envisage could be developed into a business”, Mark Holton said.

“This type of work enables an accounting firm to grow with the client and should be part of the regular offerings that firms are making”.

Peter Towers, Managing Director, ESS BIZTOOLS indicated that research and development is the start of a trifecta of services that proactive accountants are offering to their clients from:

  • when someone has an “idea” and then needs advice to embark on the research and development journey; and
  • once that is concluded, the company could be eligible to apply for an Accelerating Commercialisation Grant of up to $1 million, on a 50% funding basis, to successfully “commercialise” the product prototype so that it is able to enter the marketplace; and
  • many of these companies will require capital to ensure that the “commercialisation process” is enabled and, for this reason, accountants could then be bringing to their client’s attention the possibility of raising capital as an Early Stage Innovation Company or a Crowd Sourced Funding Equity Raising Company.

In the ESS BIZTOOLS’ Business Advisory Services Webinars/Conversation on Wednesday, 24th March 2021 at 1.30pm AEST (2.30pm AEDT) Mark Holton and Peter Towers will discuss the benefits that accountants can create by proactively embracing the concept of offering advice on research and development to small and medium-sized enterprises.  To register for this free webinar please click here.

Converting Research and Development to Return on Investment

This was a very interesting conversation in the last ESS BIZTOOLS’ business Advisory Services Webinars/Conversation with Peter Milla, Director, Businesstree Pty Ltd.

“Board of Directors should not approve a research and development project unless the leadership team has included full details of the estimated cost of the research and development project, the estimated revenue to be generated from this new technology, the estimated costs associated with that revenue and the projected profitability to be earned from this particular research and development project so that the return on investment is able to be calculated and compared to the company’s hurdle rate for investments” Peter Milla said.

“A company should only invest in research and development if it is for the creation of new knowledge that the company can then exploit to earn a return on the investment for research activities” said Peter Milla.

There are a number of key matters to be considered in deciding to undertake a research and development project including:

  • What is the new knowledge that the company is seeking?
  • How can that new knowledge be commercially exploited to generate a profit for the company?
  • Will the company be able to undertake this project in accordance with the rules for the claiming of the “Research and Development Incentive Rebate”?
  • Has the leadership team conducted sufficient enquiries to satisfy the Board of Directors that there is no prior art/literature similar to what the company hopes to create? If there is prior art/literature, it potentially means that the company is wasting money by pursuing a research and development project that relates to a subject that has already been proven because someone is producing this type of product or service already.

You can listen to the recording of the conversation between Peter Towers, Managing Director, ESS BIZTOOLS and Peter Milla, Director, Businesstree Pty Ltd by clicking here.

Upcoming Webinars

ESS BIZTOOLS’ free research and development webinars for accountants, business advisors and bookkeepers are being presented on:

Date

Title

Registration

Wednesday 24th March 2021 at 1.30pm AEST (2.30pm AEDT) - Mark Holton, Director, Smithink Pty Ltd “Research & Development Can Assist Accountants To Differentiate Their Services” https://essbiztools-au.zoom.us/webinar/register/WN_Ba9vOl6ZRZiE2ONGOryKtA
Wednesday 31st March 2021 at 11.30am AEST (12.30pm AEDT) - Matthew Karakoulakis, Principal Solicitor, AMK Law “Legal Issues Relative to Research & Development” https://essbiztools-au.zoom.us/webinar/register/WN_i6TDxAE1Q7mmt5zvaX4GBQ

Research & Development Webinars

ESS BIZTOOLS is presenting a series of free webinars on research and development:

  • Thursday 25th March at 12-noon AEST (1.00pm AEDT). Title: “Introducing Research & Development Services To Your Clients/Prospects”.  To register click here.
  • Tuesday 13th April at 2.00pm AEST. Title: “Evaluating Research & Development Product Package”.  To register click here.
  • Thursday 22nd April 2021 at 12-noon AEST. Title: “Evaluating Research & Development Product Package”.  To register click here.

Challenges Ahead

You are most welcome to visit our websites – www.essbiztools.com.au or www.essbizgrants.com.au where you can obtain information on government grants that are available for an individual client.

If you are interested in obtaining a free, no obligation overview of the Business Advisory Services Product Packages developed by ESS BIZTOOLS to assist accountants to deliver a wide range of Business Advisory Services without you having to reinvent the wheel by spending hundreds of hours in writing the material, please “Book A Demo” on the ESS BIZTOOLS homepage – www.essbiztools.com.au or contact Peter Towers:

Stay safe!
Have a great day.

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