Posts

Are you a trusted accountant?

I was doing research on a book project the other day and came across a most interesting article on the web. Although it was originally published in April last year – its lessons are still pertinent. It talks about the position of trust that accountants have in the business community as well as some other professions. The full article appeared in Brisbane Business News – see http://www.brisbanebusinessnews.com.au/process/myviews/bbn_article.html?articleId=1685

A SURVEY of more than 600 Australian and 240 New Zealand business owners conducted by an accountancy, financial planning and law association has discovered that accountants are the most trusted advisers when it comes to business advice. The MSI Global Alliance March 2011 survey scanned a range of business and personal financial advice areas, where participants were able to select their lawyer, accountant, bank, business coach or financial planner.

While much has been written about the lack of professionalism of financial planners, participants rated them as the most trusted source of retirement planning advice (40 per cent) with accountants following closely behind on 37 per cent. This rated accountants highly despite the fact individual accountants are not allowed to offer investment advice to clients.

The banks, on the other hand, were harshly rated with only 10 per cent of participants agreeing that they are the most trusted source of advice when it comes to business finance and retirement planning. It also asked participants to comment on how each category of adviser could improve.

ACCOUNTANTS

Common perceptions

• In advice terms, too focused on past performance, not the future
• Do not like to leave their offices
• Partners in firms can be inaccessible

Suggested improvements

• Don’t charge for face-to-face meetings. It stops clients going to their accountant for advice and disables a proactive client-adviser relationship
• Visit clients in their offices. The fees will flow.
• Focus on assisting with forward planning and business strategy rather than being retrospective

LAWYERS

Common perceptions

• Fees always end up being higher than quoted
• ‘Legalese’ is difficult to understand and lawyers do not compensate their language for clients

Suggested improvements

• Estimate the work to be done and associated fees more clearly upfront
• Communicate immediately with clients if additional fees will need to be charged
• Breakdown fees charged more clearly
• Talk in a language that is easy to understand
• Be more proactive and instigate client meetings on matters such as estate planning

BUSINESS COACHES

Common perceptions

• Lack of formal qualification/credibility
• Rely on self-help books more than genuine experience with business

Suggested improvements

• An ‘institute’ is required that can regulate and accredit business coaches
• Focus more on coaching budgeting/savings planning

FINANCIAL PLANNERS 

Common perceptions

• Still charge commission, dressed up as a ‘percentage of funds under advice’
• There is no uniform qualification for financial planners, reducing their credibility
• Push clients into funds from which they receive the highest commission

Suggested improvements

• Charge a dollar based fee-for-service
• Clearer analysis and distribution of super fund performance compared with other funds
• Clients would consider performance fees when performance is better than market averages
• Be transparent and offer more individualised recommendations than managed portfolios from other financial institutions

Don’t show me the money!

I was in a meeting recently with a couple of senior partners with a big accounting firm (think top 10).

We were discussing with a marketing consultant I introduced to the firm what do people operating their own businesses really need and want from their advisers – in this case accountants.

The conversation went the usual way regarding client compliance needs, opportunity to value add, be proactive and the like. I’ve been in lots of discussions like this over the years and I’m sure you have too. Too often these conversations revert to motherhood statements, platitudes and the bleeding obvious.

However, towards the end of the meeting, something interesting happened. One of the senior partners, leaned forward and said the following (paraphrased):

We have to be upfront and completely honest with people that we meet who may or may not become a client. If we can help them improve their business and grow then we need to show them how we can do that. If we can’t help them then we need to tell them and step away.

I really like that statement. So often accounting professionals have so much pressure on them to meet their budgets, keep their write offs to a minimum and use everything in their power to make sure productivity is kept at a high level. Rightly or wrongly their is a (over) focus on fees.

The sad fact is that if you, as an accounting professional, are preoccupied with fees and the paraphernalia that comes with that, then clients will feel, see and smell it. No amount of soothing words, gifts, seminars/workshops, and invitations to the corporate box at the Rugby or Cricket will or can change a clients view that you and your firm is only interested in the money.

Wouldn’t clients prefer and want advisers (be they accountants, lawyers, management consultants etc…) to focus on them and their business, personal wealth and wellbeing and view their fees as a byproduct of a committed and strong relationship?

This is the sole reason I have stayed with my own accountant for more than 10 years now. He takes care of me and he knows the fees will take care of themselves.

What do you think.

All my best,

James E.

How to get clients (3 of 4)

Last post I introduced the idea that one great way to get clients is to start to think like a client.

Clients want their accountants not just to help they make more money, but to SAVE MONEY. Now this just isn’t my opinion, but the CFOs & CEOs I’ve interviewed for the book I authored last year “What do Accounting Clients Really Want?” also share this view … although they are much more colourful in the way they express their desire for their external accountants to save them money.

As mentioned in Friday’s post, accountants tend to have an intimate knowledge of how their client’s businesses work.

Here is one example one of the CFOs I met with gave me about how their accountant saved their business money. Granted it is a story of an accountant doing better with a current client (rather than getting a client) but it is still a great example!

The accountant in question was undertaking a review of the client’s business and discovered that there were some tax concessions which could be obtained through a closer look at their research & development activities. To cut a long story short, the accountant (off his own bat) undertook a project around the R & D treatment, which wasn’t his area of expertise, investigated how the business was placed, liaised with the ATO and produced all the necessary documentation which was not a straightforward task. After a few months of concerted effort the end result was a tax saving of several hundred thousand dollars and a very happy CFO. In fact the CFO was so happy, they paid the accountant a big fat success fee.

Not a bad way to save money.

Now, of course, you may be thinking to yourself, well that’s great if you have a big client and can find big savings. The above client had a revenue of around $100m – so it was fairly big. However, there are dozens of ways to help your client save money. Here are just a few:

  • Don’t use recruitment agents to find staff
  • Convert offline advertising to online activity
  • Ask suppliers for a better deal (believe me … you’d be surprised at some of the responses)
  • Tender out non-essential business processes
  • Survey your client’s staff and run a context to help identify cost savings

See you next post for another way to get clients.

All my best,

James

How to get clients (2 of 4)

Let me say right up front – I’m not an accountant. My professional training is in the areas of economics, education & management. That being said I’ve been a keen observer of individual professional accountants, accounting firms (big and small) and their clients for many, many years.

The best way to get more clients is to think like a client. If I put on my “client hat” then I want 3 “things” from my accountant. Today’s post will talk about 1 of these, the next 2 posts will talk about the remaining things not just that I want, but the majority of business clients and owners out there want and need.

Leaving to one side the legal/regulatory need for businesses to comply – e.g. tax returns, audits and the like clients want their accountants to help them MAKE MONEY.

It is well understood that accountants, throughout the developed world, (usually) enjoy having a strong & trusted relationship with their business clients. Consequently, it will be safe to assume that the accountant has an intimate knowledge of the internal workings of their clients. In fact I have friends in the accounting profession that know their client’s businesses better than the owners of the business!

What a wonderful opportunity then to come up with ideas that can help your business clients identify new markets, explore different product or service development, uncover ways to more efficiently deliver outcomes to their customers or any one of dozens of ways to come up with avenues to help your client make more money.

Who better to help businesses come up with ways to make more money than you?

See you next post,

James E.

 

 

 

 

Trusted Business Adviser

The term “trusted business adviser” is often used to describe the pinnacle of the accountant–client relationship. Everyone seems to want to be a trusted business adviser. The key element of this exalted title is trust.

However, like most pedestals or sort after titles, through their overuse the term quickly becomes cheapened. It seems these days that anyone with a business card, website and is wearing a suit becomes a trusted business adviser. This, fortunately, is not the case. Becoming a real trusted business adviser takes commitment, passion, patience and lots of hard work.

One definition of trust is the strong belief or confidence in the honesty, integrity and reliability of another person. Such a belief cannot be fostered in a quick coffee meeting or drinks at the cricket. Trust is built through a series of interactions that show you are honest and consistent, and have the best interests of the client in mind. Trust is something that is easy to lose but difficult to earn. Here are some characteristics of a trusted business adviser:

  • They invest time and effort in initiating and building a relationship
  • Often they give out to the client before receiving anything in return.
  • The focus of their activity is not fees.
  • They consistently look for ways to help the client.
  • They are patient and long-term in their thinking.
  • They are flexible in the ways they do business to suit the client, not simply themselves.

If you were to were to use the above six points as a gauge for your professional activities with your clients how would you rate? Are YOU a trusted business adviser?

Keep smiling and bye for now,

James E

The danger of overselling ( 2 of 2)

Last post we left the story with the question: ” How could a senior partner who is highly skilled & experienced in the art of relationships & business development get it so wrong in what one would think is a simple and straightforward pitch?”

Unfortunately, the answer is amazingly simple. Don lost sight of the relationship and was focused on the fees. The prospective client wanted a specific project done – A. Don not only presented and impressed the client that he and his team can do A and do it very well, he went on to “sell” the client B, then C, D, E and F. That was his mistake. Don, under pressure to generate more fees simply oversold what the firm could do for the client. It was clear to the client, obviously not Don, that  the relationship with him and his organisation was not the focus of the meeting but rather he was being groomed as a “cash cow” of sorts. Understandably the client was unimpressed and things went downhill quick from there.

Clients aren’t stupid. The CFO in this example saw right through the facade and he didn’t like it one little bit.

What could Don have done differently? With the benefit of hindsight – Don should have focused on doing A and impressing the socks off the client and invest in the relationship. After respect and trust has started to develop Don could have easily mentioned about service offering B and maybe even C. I dare say the reception from the CFO would have been different after he saw that Don and his team were in it for the long haul and wanted to start and build a relationship and add “goodness” to their client 🙂

Until next time.

All my best,

James

Why do accountants exist? (3 of 3)

By way of recap, in the last couple of posts, I’ve been writing about what I think are the reasons why accountants exist (leaving to one side the compliance,legal & regulatory requirements) . Reason 1 = make money, reason 2 = save money. To my mind reason 3 is to SAVE TIME.

We are all familiar with the cliche time is money. As I’m sure I’ve said before in earlier posts, cliches are often cliches because they are true. So it follows that if you can save your client time you in effect help them make money or save money. For the most part, if your client can spend less time on a business process that you identified can be streamlined then you give your client “more” time to focus on other areas that can help the business grow.

As one of the key advisors to your client’s business, you are in a wonderful position to identify ways and methods on how you can save your client time.

To wrap up this 3 post series … if you can’t either make money, save money and/or save time for your client you are little more than a commodity provider of compliance services. Unfortunately when a service becomes a commodity you are locked into a cycle of high volume/low margin service provision – since there are literally thousands of providers in Australia and offshore that can produce tax returns, accounts and the like for rock bottom prices. I wouldn’t have thought this is the path to growing your practice into a team of trusted advisors making a difference for your clients.

Until next time,

James E

Why do accountants exist? (2 of 3)

Last post I shared with you the 1st reason why accountants exist – to make money for their clients. We now move onto the 2nd reason why accountants exist.

Accountants exist to also SAVE MONEY for their business clients. Now this just isn’t my opinion, but the CFOs & CEOs I’ve interviewed for the book
“What do Accounting Clients Really Want?” also share this view … although they are much more colourful in the way they express their desire for their external accountants to save them money.

As mentioned in Monday’s post (https://whatdoclientsreallywant.com/why-do-accountants-exist-1-of-3/) , accountants tend to have an intimate knowledge of how their client’s businesses work.

Here is one example one of the CFOs I met with gave me about how their accountant saved their business money.

The accountant in question was undertaking a review of the client’s business and discovered that there were some tax concessions which could be obtained through a closer look at their research & development activities. To cut a long story short, the accountant (off his own bat) undertook a project around the R & D treatment, which wasn’t his area of expertise, investigated how the business was placed, liaised with the ATO and produced all the necessary documentation which was not a straightforward task. After a few months of concerted effort the end result was a tax saving of several hundred thousand dollars and a very happy CFO. In fact the CFO was so happy, they paid the accountant a big fat success fee.

Not a bad way to save money.

Now, of course, you may be thinking to yourself, well that’s great if you have a big client and can find big savings. The above client had a revenue of around $100m – so it was fairly big. However, there are dozens of ways to help your client save money. Here are just a few:

  • Don’t use recruitment agents to find staff
  • Convert offline advertising to online activity
  • Ask suppliers for a better deal (believe me … you’d be surprised at some of the responses)
  • Tender out non-essential business processes
  • Survey your client’s staff and run a context to help identify cost savings

See you next post for the 3rd and final reason why accountants exist.

All my best,

James

Why do accountants exist? (1 of 3)

Let me say right up front – I’m not an accountant. My professional training is in the areas of economics, education & management. That being said I’ve been a keen observer of individual professional accountants, accounting firms (big and small) and their clients for many, many years.

If I put on my “client hat” then I want 3 “things” from my accountant. Today’s post will talk about 1 of these, the next 2 posts will talk about the remaining things not just that I want, but the majority of business clients out there.

Leaving to one side the legal/regulatory need for businesses to comply – e.g. tax returns, audits and the like clients want their accountants to help them MAKE MONEY.

It is well understood that accountants, throughout the developed world, (usually) enjoy having a strong & trusted relationship with their business clients. Consequently, it will be safe to assume that the accountant has an intimate knowledge of the internal workings of their clients. In fact I have friends in the accounting profession that know their client’s businesses better than the owners of the business!

What a wonderful opportunity then to come up with ideas that can help your business clients identify new markets, explore different product or service development, uncover ways to more efficiently deliver outcomes to their customers or any one of dozens of ways to come up with avenues to help your client make more money.

Who better to help businesses come up with ways to make more money?

So the first reason why accountants exist, is to help their business clients make more money.

Tune in this Wednesday & Friday to find out reasons two & three!

All my best,

James

My lunch with Liam Neeson

Last week I was having lunch with a CFO of a company that I had interviewed last month for the “What do Accounting Clients Really Want?” book. As always to protect the innocent lets call this CFO Liam as in Liam Neeson one of my favourite film actors.

In my humble opinion the best way to get to know someone better is to “break bread” with them – be it lunch or morning tea it doesn’t matter. There is something quite special when you sit down with someone and simply talk over food and drink.

In the example of my lunch with Liam a simple meal allowed us both the time and space to get to know each other better. It was a good & enjoyable exchange: I told Liam about my family and he told about his; he told me about his work; I told him about mine and on it went. The conversation went in all different kinds of directions and at the end of the lunch I can say with complete certainty that we both got to know each other better and trust & respect began to build.

Following the lunch, we went back to his office and Liam gave me a tour of the business operation. I lost count of how many staff he introduced to me during our walk around the facility but it was great to have a first-hand look at how their business operated.

After the tour, Liam reminded me of an item we had spoken about over lunch involving me introducing to Liam a chap I know who may be able to help with them with some new ideas for their marketing offering. In my line of work I’m often looking for opportunities to put people together in some mutually beneficial way. And here was the opportunity.

If you are genuine and sincere and want to get to know people better two things will follow. 1. You have a relationship with a new friend. 2. Business opportunities will just flow.

Lunch is good for business!

All my best,

James E