In this guest article, accountant & mentor Reza Hooda shares why compliance is thriving and how it can be used to manage your client’s full finance function & deliver real advisory services.

Compliance is dead…. Software and automation is taking over your role…. You need to do be doing ‘advisory’… Really?!  

Don’t believe everything the naysayers tell you! 

In an ever-changing landscape, our role as compliance champions is more important than ever. Compliance is thriving – in fact, software has brought us closer to our clients than ever before. 

This level of collaboration where we have real-time access to client’s numbers only benefits and strengthens the value in our relationship. 

Without an accurate and compliant finance function, advisory is meaningless. 

‘Advisory’ does not mean providing fancy consulting services like McKinsey et al. Providing support, help and advice off the back being able to maintain an accurate, real-time finance function is ‘advisory’

It’s about having those conversations to interpret numbers, generating meaningful reports and projections from which better decisions can be made and helping clients to chart out and work towards their goals- that is advisory  …which you’re probably doing already.

There is a huge opportunity for accountants at present. That opportunity is not necessarily in advisory per se but in effective management of compliance work. In other words, managing our client’s finance function.

The finance function

In my firm, our most profitable and highest paying clients are the ones where we do everything – from bookkeeping to VAT returns to payroll to accounts prep to FD support to tax planning. In other words, the full finance function. For some clients, we earn fees of over £60,000 per annum for providing this service.

Furthermore, our highest growth area is where we take on board the full finance function for a client.

When you are in daily control of the client’s numbers, you create dependency. You (or a member of your team) have reasons to be in regular, even daily, contact with the client. You are creating ‘touchpoints’ to give you an opportunity to wow your client with your customer service.

To put it crudely, until recently accountants considered bookkeeping to be ‘beneath them’. The client needs to do their own bookkeeping or engage a bookkeeper and then we as the ‘great’ accountant will do the lofty accounts prep work that really matters.

Those days are gone.

Nowadays, whoever owns the numbers, owns the relationship.

Your clients are not interested in their statutory accounts. Talking about history is not going to float their boat. The year-end accounts have little impact in your clients’ business today. They want you to have more involvement in their business. They want you to tap into your expertise as a business owner yourself – and your experience in dealing with so many other businesses – to help them grow and make their business successful.

So – do not shun an opportunity to take on board the client’s bookkeeping. Take it. We have had several big compliance fees come on board by stepping in when a client’s full-time finance staff has left. When the client is paying between £30,000 – £40,000 for a bookkeeper or financial controller if you can do the same job for less, then why wouldn’t they pay you instead? With technology, you can do the work a lot faster and know it will be correct.

The anchor for your price, in this case, should be the amount they would ordinarily have to pay for an in-house accountant, financial controller or finance director – all roles that you would provide to them on an outsourced basis.

However, I wouldn’t use the term ‘outsourced’ because of ‘cheap’ connotations. Use words like ‘Virtual Finance Office’, as we do, or ‘Real-Time Management Information’.

Another advantage of controlling the client’s numbers, or having access to them in real-time, is that you save yourself a lot of work when doing the year-end process.

We know as practitioners that even those clients who proclaim to have their books kept in pristine condition leave a lot to be desired. Think of the horrors you come across sometimes even when taking over cases from other professional accountants!

That should be reason enough to want in-house control of, or have sight of, the data in real-time, so you can check in regularly and intervene before the mess gets out of hand.

The big 4 accountancy firms are already moving in this direction. Deloitte with their Propel offering; KPMG tried with their Small Business offering but failed as they were unable to deliver it personally and effectively. 

What the big firms lack is the personal touch and service. That is where we win.

Going forward, it will be much more cost-effective for small businesses to have an accountant dealing with the vast majority of their finance function than hiring individuals to do the same. Seize the opportunity!

Reza trained with PwC before leaving in 2008 to buy into a small traditional firm near Southampton called Walji & Co. In the years since he has transformed the firm completely – trebling turnover and achieving profit margins of 50%. He has managed to systemise the firm so it can largely run without him and now dedicates his time to coaching and mentoring other accounting firm owners to do the same. To learn more about Reza visit his website