22 Nov 2021
How does your accountancy firm differentiate itself from the competition? Most firms agree that accounting services fall into three main levels: compliance, performance and advisory.
Compliance sits at the foundation; it involves offering the necessary services to keep clients compliant with the law. The majority of accountancy firms still operate at this level, providing services like tax, financial reporting and bookkeeping.
The second level on the pyramid, performance, focuses on monitoring the health of clients’ businesses. It involves assessing profitability and providing the underlying narrative behind the business’ financials. It’s about looking at the “here and now” of the business, and in this sense performance can be seen as a stepping stone towards true advisory.
The top of the pyramid, advisory, relates to firms who offer strategic services to clients.
These firms don’t just provide performance analysis but advise on the best next steps in terms of financial strategy.
The shift within the accountancy sector from compliance towards an integrated advisory proposition is well documented and discussed.
A growing number of accountancy firms are adopting an advisory approach, providing business clients with access to value-added services like strategy and consulting.
Compliance-only firms, on the other hand, face revenue squeezes as the efficiencies of technology-enabled automation create an increasingly competitive marketplace.
Until the emergence of cloud computing, hundreds of hours were allocated to time intensive tasks like bank reconciliation and data cleanup.
Today, these tasks can be accomplished in just a few minutes by cloud accounting software.
As a forward thinking accountancy firm, you should aim to move away from being valued for your time to being valued for your expertise by becoming a trusted advisor to your clients.
Utilise the latest technology to eliminate time-consuming compliance tasks from your working day and use that time to help mould your clients’ strategic outlook, and create a framework for implementation so they can meet their goals.
The rollout of Making Tax Digital (MTD) by HMRC ensured that all firms had to use compatible software to manage their tax and their clients’ tax affairs.
MTD currently covers VAT submissions, however it will be rolled out for income tax and corporation tax in the years to come.
The degree to which firms have taken the opportunity to digitise beyond the regulations required varies.
As a minimum, all VAT records must be held digitally and accountants must hold digital software capable of transferring client’s financial records across to HMRC.
The days of piles of paperwork to sort through are past us; now, accountants have more time to focus on their role as an advisor to their clients.
MTD provided some accountancy practices with the impetus to innovate.
Instead of just meeting the minimum requirements, they’ve embedded their digital proposition at the heart of their firm.
These firms are utilising digital tools to the best of their ability to meet those compliance tasks that were traditionally manual, monotonous and time consuming.
For example, in preparation for MTD covering Corporation Tax, some firms have decided to stay ahead of the curve by implementing software that handles corporation tax returns and facilitates fast, efficient and accurate calculations and submissions direct to HMRC.
Cloud bookkeeping software allows accountants to access clients' financial information at the touch of a button, and use that information to automatically produce a client’s annual accounts to submit to Companies House.
Meanwhile, accountants are using cloud payroll software to automate payroll calculation and submission, as well as to automatically generate payslips and offer reporting capabilities.
Advisor working on securing funding for client
The benefit of using a full suite accountancy management software package, such as Capium, is that you only have to enter your data once, saving you hours on admin.
Let’s say you run payroll.
The data you input into Capium feeds through to bookkeeping, which then feeds through into accounts production, which also then feeds into corporate tax where applicable.
In other words, there’s no need to waste time entering the same data across different modules.
You can wave goodbye to spreadsheets too because Capium lets you compare reports such as P&L, Balance Sheet, Cashflow and Trial Balance easily across different time frames.
Another huge benefit is that everything is hosted in the Cloud, so you and your team can access important client data anywhere using secure two factor authentication.START YOUR CAPIUM FREE TRIAL TODAY
By outsourcing time consuming compliance tasks to technology, accountancy firms can reallocate the time they save to more strategic, value-added work for their clients.
Automating routine tasks like data entry and complex calculations lets you and your team do more of what your clients value most – providing insight and supporting their business ambitions to help them reach the next level.
Through offering your advice and expertise, you have the potential to become your clients’ trusted go-to advisor. Businesses naturally require additional services and advice as they continue to grow, and by offering these you’ll have the opportunity to grow alongside them.
When offering advisory services, it’s important to take a strategic approach that prioritises execution and implementation.
Like everything in life, we can find ourselves setting ambitious goals without giving proper thought to how we’re going to achieve them.
As an accountant, your value lies in your ability to sit down with a client - either virtually or in-person - and guide them through how they’ll reach their goal and how quickly, whether they want to open another cafe or expand their online business.
More often than not, companies require funding to fuel their growth plans. For example, let’s say your client is a hairdresser who wants to double their revenue. External funding can provide them with the capital that is required to expand from two salons to four. This will provide the capacity to generate that additional revenue.
Or, if your client is a manufacturing business who has taken on a large contract as part of their expansion plans, working capital products such as invoice finance or revolving credit facilities can help protect cashflow while production is ramped up.
Funding Options, work directly with businesses and their trusted advisors to secure vital business finance. Through an in-depth understanding of the business finance market mixed with technology, you will find financial solutions that fit your business needs.
From short-term cash flow loans to asset finance, joining an advisory platform like Funding Options’ Connect can help you find finance for growth on behalf of your clients.
As long as the amount your client requires finance is between £1000 up to £15M, Funding Options can help. Compare over 120 lenders specialising in different types of finance, including funding that is designed for specific sectors of the economy.APPLY FOR FUNDING TODAY
Sign up for the best of Funding Options sent straight to your inbox.