Simon Madder, CEO & Managing Director co-authored an industry White Paper with Tim Bennett, Head of Corporate Development, stating that accounting firms of the future need to demonstrate greater client value by diversifying their services and taking on more advisory work.
The White Paper titled “The Power of Insight” outlines how accounting firms can adapt to a changing environment and expand their services to increase future value.
Simon said the accountants role of ‘trusted adviser’ is up for discussion and accountants currently face a choice – do nothing, or grow and deliver a more comprehensive range of advisory services.
“Compliance work has traditionally been the backbone for most accountants, making up to 70-80 per cent of revenue but it is starting to progressively become a smaller portion of their overall revenue base. “
“Progressive firms are now aware that to avoid losing revenue you need to provide more advisory services in order to grow your client base and help those clients achieve their financial goals.”
Prime believes the changing environment is a golden opportunity for those accountants who already hold a trusted position to take on more advisory work.
Simon added that financial advisers are setting up accounting divisions and those same financial advisers are delivering lending solutions. Similarly, the lines between bookkeeping and the traditional accounting space are blurring.
The White Paper, which was contributed to by research house Bstar, also tackles legislative changes to SMSF’s, technology, outsourcing and succession planning for accountants.
Bstar founder and CEO Grant Bloxham said the absence of formal succession planning has left many partners questioning how they are going to fund their retirement.
“Succession planning has moved from a strategic concern, to a high need to act operational concern.”
“65 per cent of accountants believe the proceeds from the sale of their practice or practice interest won’t be enough to fund their next business venture or desired retirement,” Mr Bloxham said.*
Simon added that “with fewer practitioner buyers, if you don’t get the culture, vision and alignment right for the next group of buyers – they may not come along for the ride if they don’t believe in the future you’re painting.”
Prime’s White Paper states that opportunities for accounting firms “have never been greater“, and new challenges will emerge as firms actively address the range of services they offer and develop formal succession plans.
“The best firms will meet these challenges head on, developing a strategy to prepare their teams for the future and continue to grow and drive sustainable client and firm value,” Simon said.
To DOWNLOAD The Power of Insight WHITE PAPER: