I worry that some of the current conversations about accountants delivering advisory services are over complicating this and making it sound so much harder than it really is.
First let’s define what an advisory service is.
I believe an advisory service is anything that is not a compliance service.
A compliance services is any service that supports the client to meet obligations imposed by regulation or law. The typical examples of this for business are preparation and lodgement of Income Tax, FBT, Land and other tax returns, Business Activity Statements, preparation of statutory accounts and statutory audit.
I believe that the compliance services you provide to your clients provide a great platform for the delivery of advisory services and here are three to start with that you can easily deliver.
- Business Plans
I fundamentally believe that every business should have a plan for each financial or calendar year. There is an old saying that those who fail to plan, plan to fail and I think it is true. What I say to accountants is this. Use with your clients the same process you use for your own business planning. Not doing any planning for yourself? Oops! Best contact me now and we will get that sorted for you. Then you can help your clients do the same. It doesn’t take much work to get a planning structure in place that you can use time and time again with clients. I’ve got a structure I use for myself and with firms, that I have evolved over many years and perhaps you have something similar.
This is a natural flow on from the planning process and is in many ways integral to it. I am a big believer in each business having a three way budget – that is P&L, balance sheet and cash. Most businesses focus on the P&L but I don’t think that is enough. Cash and balance sheet budgeting is very powerful. Many accountants have a spreadsheet model they have developed for this and of that works for you then great. There are now some great tools to help you with this including Castaway, Fathom, Futrli and Spotlight Reporting, amongst others. They make the process much easier and guarantee it all balances!
I see both planning and budgeting as iterative processes but once complete should provide a succinct and clear articulation of where the business wants to go and how it is going to get there.
- Progress Reviews
There are lots of different terms for this but what I am talking about here is monthly or quarterly meetings with a client to review the results of their business and talk about what these mean for future actions. The reviews will compare actuals to budget and help the business owner understand reasons for variations and what that means for the business. In an age where things change so quickly the notion of an accountant only talking to a client about their business once per year is patently ridiculous.
A second component of this discussion can be helping the client set some goals to be achieved before you next meet with them. These will tie back into the business plan (or at least they should). This is how you can provide some accountability with your business clients that they will appreciate. (Talk to me if you would like me to do the same for you.)
Don’t be put off if you struggle a bit with the delivery of these services to start with. Push through and you will find that after you have done a few with clients you will be more comfortable. I really enjoy delivering these sorts of services to accounting firm owners and I hope you will enjoying delivering them to your clients.
No more excuses, just have a go. And yes you should have a fixed price agreed up front with each client for each of these services. And if you need help to implement I will be happy to assist.