The movie Shallow Grave has a scene where one of the three primary characters has to decide on sticking with accounting or changing his career. The firm he works for has rows of desks in a silent wood panelled room with accountants and a dictator for a manager.
Admittedly this scene is for dramatic effect though it does fit a stereotype of what many people think accounting is all about.
Most of my career has been spent working for or with accountants and I’m happy to report that they are not a bunch of boring bean counters.
Working for and with Charted Accountants has enabled me to see what it is like on the “inside” and how useful good accountants can be for businesses and individuals.
Over the past 10 years or so there has been a lot of change in the accounting area and much of this has been bought about by changes in technology.
It is not enough for an accountant to just do “annual accounts” and tell people how much tax to pay (compliance in accounting speak) anymore. Important as compliance work is, accountants need to become what is called the “trusted advisory” to their customers. Incidentally, I prefer to use the word customer than client because I think it better describes the relationship between the two.
To be a trusted advisor, firstly requires the ability to advise and to do this successfully I believe requires up to date, relevant and accurate information for the customer combined with the experience and know how on using that information. For sure, the annual accounts will provide some of this information however only for the time soon after the accounts were produced.
This is OK for statutory or regulatory reasons (compliance as it is called in the industry) however 95% of this information is based on the past when 95% of businesses are focused on the future.
Accountants these days have planned, scheduled meetings throughout the year with their customers so the information can be used to help make business decisions and to spot changes and react accordingly.
It is much better to be in the situation where a decrease in revenue compared to last month or against budget for that month is being discussed the next month rather than six or 12 months down the track. Proactive steps can be taken to resolve issues causing dips in business performance before they get completely out of hand and opportunities can be quickly acted upon.
The information that accountants and their customers provide banks and other financiers is now much more up to date and can assist in the recovery of a business where in the past the bank may have removed support.
The technology behind this transformation in accounting has been in two areas:
- The accountant can import data from customer systems, or;
- The accountant and the customer use the same dataset.
Products in the cloud have changed the way accountants help and support their customers to such an extent that the accountant who does not embrace this technology will be left behind by their competition and more importantly, their own customers.
Furthermore, these cloud based products such as Xero offer value for money that in the recent past would have been compromised by a lack of features.
A good example of how this also helps the accountant get more business is when I had demonstrated Xero with the Spotlight reporting add-on. Immediately the prospect could see that in his words the conversation with his related parties would be in his words, “straight forward and non-confrontational”. He would be able to see graphically how the business is performing without having to delve too deeply into the figures.
Sample Spotlight Reporting Dashboard
It is also much easier for accountants to offer fixed price packages so their customers can choose what best suits them in terms of services and price.
There has been much change in the accounting industry since I first started working with accountants and from what I’ve seen it has been good for the accountants that embrace the change, and better for their customers.