Why you should practice proactive accounting

1st June, 2015

If you go to a random selection of accountants’ websites, you will find that most tell the world they are proactive. It has become a bit of a motherhood statement because sadly, few accountants truly embrace proactivity in terms of the way in which they interact with their clients.

I think there are some trends in the accounting profession that demand that accountants become much more proactive with clients than they traditionally have been. These include:

  • Cloud accounting is becoming more and more prevalent. Suddenly, clients have access to real time information. They think they now have everything they need to make informed management decisions. Sadly, they don’t. It’s one thing having the information, but it’s another thing altogether to understand and interpret the numbers. A little information can be a dangerous thing. Accountants need to intervene and proactively help their clients understand what the numbers mean.
  • Price pressure will increase significantly as clients realise that cloud accounting reduces the time needed for the accountant to do what they need to do. As a result, to sustain fee levels, accountants need to add value. They can do this by being more proactive, having more face-to-face meetings with clients, understanding the client’s needs and offering additional services to help the client meet those needs.
  • Bookkeepers are facing the same issues from clients. As such, they are actively looking to do some of the things that accountants typically do (such as analysis, reporting, monitoring). They also have access to real-time information as the client’s bookkeeper. If the accountant does not proactively offer those services, they should not be surprised if someone else does.
  • Similarly, business coaches, armed with cloud accounting solutions and add-ons to help them explain the numbers to clients, are targeting this space as well.
  • In a changing economic environment, clients need their accountant more than ever. They just don’t know it — until you talk to them and find out what help they need.
  • Banks are demanding more and more information from businesses to provide comfort for loans and overdraft facilities. The accountant is perfectly positioned to help in this area, but you need to be on the front foot discussing cash flow issues with clients and offering to work together with the bank manager.

We recently undertook a survey of 428 Australian business owners* to determine the sort of relationship that business owners want from their accountants. Highlights from the survey are:

  • 93 percent said they would prefer a Real Time Accountant — someone who keeps an eye on their figures throughout the year and proactively alerts the client when something goes off track.
  • 61 percent said they wanted their accountant to focus more on the future than the past and to offer services to help them improve their business.
  • 65 percent said they would like their accountant to call them proactively at least twice a year just to see how things are going.

Clients want this, but few accountants offer it. Those who do stand out in what is a sea of sameness and are rewarded with stronger client relationships and more business advisory work as a result.

Here are some examples of what it means to be proactive:

  • Offering advice before something goes wrong, rather than waiting for things to happen
  • Offering business advisory services that help clients without worrying about whether the client will want them or not
  • Focusing on growing a very important key performance indicator year on year — the percentage of revenue coming from business advisory services
  • Visiting and calling clients systematically throughout the year
  • Informing clients of your client communication schedule and following through with it
  • Following up on every opportunity to help the client
  • Sending links to articles that you feel would benefit the client
  • Actively promoting cloud accounting where it is in the client’s best interests
  • Running educational seminars to help clients run better businesses
  • Systematically gaining input from clients as to how you can improve your service by running client advisory boards
  • Offering ad hoc access to clients and encouraging them to talk with you when they need a sounding board — no charge
  • Scheduling work for the year ahead and providing the client with a fixed price upfront so that there are no surprises
  • Marketing new services that would be of benefit to clients and not being afraid to talk to clients about how you have helped others in similar situations
  • Up-skilling your client-facing team in how to hold effective meetings with clients to identify needs and recommend solutions
  • Investing in leading edge technology that enables you to systematically add value to the compliance work and leverage into truly valuable conversations with clients

READ: How to run effective team meetings

So are you proactive or reactive? It’s time to take a step forward to position yourself firmly in the rare camp of the proactive accountant: someone who lives by the mantra that every day, you should be focused on creating value for a client or group of clients. Give it a go — you and your clients will be glad you did.

*Survey conducted via affiliations of Colin Dunn with Australian respondents, but learnings can apply Trans-Tasman for New Zealand audiences. For the full results, please see the detailed report.