Rachel Willcox 8 May 2017 10:30am

Master of all trades

Today’s business owners are looking for a new range of services beyond basic finance from their accountants. Fortunately the ACA qualification will stand you in good stead. Rachel Willcox reports

Caption: Illustration: Jack Hudson

Chartered accountant Carl Reader is a successful entrepreneur who took the helm at accountancy firm Dennis and Turnbull (D&T) thanks to a management buy-out in 2014. He has since shifted D&T’s focus to a package of services allowing clients to access and input their accounts online with a central manager overseeing the process for a set fee and a 100%-satisfaction-or-your-money-back guarantee. Reader prides himself on offering straightforward advice to businesses looking to start, grow or franchise.

“It’s no longer about how quickly you can add up a row of numbers with a calculator,” Reader explains. “It’s about translating tax jargon into English and empathising with your clients. I think the profession needs to evolve so that accountants and accountancy students understand the wider needs a business has now.”

Reader’s approach to servicing clients underlines a growing recognition that today’s business owners are looking for something different from their accountants. In particular, commoditisation of compliance services and the automation of much accountancy grunt work has paved the way for new opportunities to offer broader business advice underpinned by technology.

The popularity of online accounting services from companies including Xero, Freeagent and Kashflow has already succeeded in shifting client expectations about the kinds of services they could expect to receive from their accountant and the role that technology plays in the delivery of that service. And that was before the prospect of digital tax accounts reared its head.

“Accountancy is a window to the rest of the business rather than the end result,” says Ed Niman, a director of accountancy firm NWN Blue Squared, which has tied its colours to the Xero mast. “Clients need a much more rounded vision, service when they want it from people who understand their business and their aspirations.”

Firms such as haysmacintyre, which offers outsourced accountancy services to a range of owner-managed businesses, SMEs and subsidiaries of overseas entities, are already reaping the rewards of that shift, as automation helps to streamline much of the bookkeeping process and scanning technology, making it easier to send invoices and claim expenses.

But more than a foundation to produce management accounts, the analytical capabilities offered by the technology also pave the way for accountants to play a more value-added and proactive role for clients, whether it’s forecasting and budgeting, variance analysis or similar, explains Kathryn Moran, a partner at haysmacintyre brought in to head up the firm’s outsourcing solutions team.
In the three and a half years since Moran took on the outsourcing challenge, it has become the fastest growing division, having more than tripled in size, and now employs 14 staff directly. Demand for outsourced accounting processes supplemented by advisory services aimed at helping clients to grow and manage risk has never been stronger, says Moran.

As part of a drive to become more of a one-stop-shop for business advice, ICAEW has granted 255 licences for firms since 2014 to provide probate services after the Legal Services Act 2007 opened up the provision of regulated legal services to appropriately qualified individuals who are not solicitors. In particular, being able to offer other legal services alongside payroll, booming since the introduction of RTI, is a compelling add-on proposition to clients and often a natural extension to private client tax work, given firms’ privileged insight into their investments and tax affairs.

In addition to compliance and broader assurance services, Grant Thornton is hoping the establishment of a growth club for “ambitious” businesses will help to future proof its own operation. Launched 18 months ago, Growth 365 targets businesses turning over between £20m and 250m who will receive access to mentors and support services including insights and analytics, overseas market introductions and networking opportunities with like-minded individuals.

“We recognise that the relationship with clients and trust is hard won and easily lost,” explains Stephen Peacock, a partner in Grant Thornton’s business growth services team. “If you live up to the brand promise and understand how to add value and grow with your clients you’re in a privileged place.” That requires judgement, tact and for highly-credible people at relatively early stages of their careers to deal with senior clients in challenging circumstances, Peacock says.

In many respects this isn’t just about developing new revenue-generating service lines; it’s also about forging a different kind of relationship with clients. Lorraine Twist, a director of recruiter Michael Page finance, says the emphasis on value-add services and the ability to understand clients’ needs applies to all levels of the practice market, from the Big Four down to smaller practices servicing the SME and micro-business market.

Deloitte partner Daniel Keeble is working on a project to identify opportunities for growing the assurance services within the UK firm’s advisory business. “It’s about making better use of the skills auditors have. If you’ve spent, say, 10 years auditing a bank, you know a lot about how that business operates. Only using that to audit the business is a missed opportunity. At the same time, clients want well-rounded people.” But finding the right people to do a mix of audit and advisory work isn’t easy, he admits.

Philip Shohet, a senior consultant at Foulger Underwood, a specialist consultancy firm for the professional services sector, says the need for accountants to relate to their clients – rather than hide behind a wall of jargon – has never been greater. “This is about using terminology that your clients understand. It has to be a business relationship not an accountancy relationship. That’s a much more compelling proposition.”

Shohet accepts that the cultural change involved with embracing these softer elements is not to be sniffed at. “Accountants need to start having proper conversations with clients, but most partners are engaged for the strength of their technical ability. Realistically, would you go to an audit partner for more generic business advice? Firms need to start engaging on a multi-partner basis with clients so they know your corporate finance, audit and tax experts in the business,” adds Shohet.

The fact that accountants are consistently cited as the most trusted source of business advice means that, on paper at least, they are well-placed to capitalise on burgeoning demand for advisory services. But although the ACA badge gives potential clients reassurance about your technical capabilities, Moran admits that finding people with the right mix of technical and soft skills to step up to these consultative roles remains a challenge. “If you’re interested in understanding a client’s business and interested in technology, it can be a great career move, but it can take a bit of time to find people.”

At the same time, the transition from manual to automated processes has significant implications for firms, warns Moran. “Technology is branching out into all service lines and working practices will change as automation takes away some of the more routine data processes. Firms have to be agile enough to work out how they generate fees from clients. The key thing is to retain service levels and think ahead the whole time about adding value and sitting alongside them as an adviser.”

The ICAEW Academy

As a combination of deregulation and automation lead to a changing landscape for accountancy services, the profession has a huge opportunity wto better position itself as the first stop for business advice and help address high business failure rates and the low proportion of start-ups that evolve into scale-ups.

But Stephen Ibbotson, ICAEW director of business, admits that companies may be put off by misperceptions of the cost and the breadth of services that accountants can provide. Accountants need to do a better job of communicating what they have to offer, he says.

The ICAEW Academy is a one-stop-shop for facilitated learning – interactive training in small groups, complementary to the ACA qualification – that aims to arm practices with the kinds of skills needed to thrive. The portfolio of courses on offer is designed to help firms be more proactive in the way they position themselves to clients, including networking influencing and practice development skills alongside training to develop broader business advisory aptitudes.

ICAEW plans to update the range of courses on offer every six months in response to market requirements, with development of commercial skills content including courses on marketing, pitching and pricing already under way. “It’s the combination of the ACA with softer skills that gives candidates the upper hand,” Ibbotson says.

To find out more about ICAEW Academy and to download a brochure of available courses, go to icaew.com/en/learning-and-development