Business is changing and faster than ever before. And accountants are no longer immune to these changes.
What are the 3 major things that are changing?
- The demystifying of accounting
Accountants have been relying on double entry bookkeeping for over 400 years and although the basic principles have not changed they rely on baffling business clients with so much jargon that those clients just give up trying to understand their own numbers. Could it be deliberate that accountants have made financial statements so difficult to understand that business owners feel they have no choice but to use their accountant as a translator?
Technology is demystifying bookkeeping to a huge extent with cloud based accounting systems written in plain English with simple terminology and no jargon. Add-ons to these cloud accounts such as the ability to photograph expense receipts using a smart phone and after a little bit of simple analysis that receipt appears in your accounts.
Automatic bank feeds pushing data from your bank into your system coupled with so few business owners writing cheques any more means that you cannot miss a receipt or payment and is effectively doing away with the bank reconciliation.
So, the keeping of accurate records of financial transactions is becoming simple and business owners no longer need a bookkeeper who is just an inputter of invoices because that process is almost just an automatic by-product of trading.
So, a bookkeeper, in the traditional sense, will inevitably disappear and so too will old fashioned accountants who currently just offer a simple compliance service with no advice.
- The rise of the “Real Time Accountant”
However, the benefits to the business owner of using this technology and “the cloud” can only do so much for them. Yes of course the accuracy of their day to day accounting information is likely to be more accurate but what can they do with it? The real benefit needed by clients is from the ongoing support from a trusted business adviser to help them reduce risk and increase profits.
Traditionally the business advice has come from reviewing historical information perhaps over a three to five-year period and analysing the trend in those numbers to generalise what the future may look like. But this is still based on history and the danger of waiting so long for this information is that the business may have already gone too far in the wrong direction to be saved. But if accountants can have access to clients’ data in real time, which is possible using cloud accounting technology, we can give them timely support based upon accurate information.
To find out what the difference between the Redundant Historical Accountant and the Real Time Accountant are click here.
- Fees based upon time spent encourages inefficiency so are being replaced with fixed fees.
Historically accountants have charged for their time, but clients don’t want to be told after the event that the accountant has spent 20 hours doing something because the immediate suspicion is that the more inefficient he is the longer he will take anyway. How can it make sense that the slower and least efficient accountants earn the most?
Fixed fees in advance are now becoming the norm for accountancy practices and will give clients peace of mind knowing how much it will cost. No one would go into a restaurant and eat a meal without knowing what it will cost them. This will also give benefits to the accountant in the longer term as it will drive the need for efficiencies leading to better use of technology and systems. The job needs to be done within a budget and this is all the time that can be spent on it so don’t waste time on anything that doesn’t add value to the client.
So, in effect clients no longer want to pay for the time spent by their accountants. They want to pay for time “saved” by themselves. The move from accountants being just a cost to being of tangible value
So, if your accountant is ignoring these changes and continuing doing exactly what they have always done, in the same way, then perhaps now is the time to consider an accountant who will give you greater value…
Then, look no further…let Broadwing Accountancy help you step out from the dark into the light. Contact Brian Munjanja on 01604 328328 or email you questions to [email protected] to see how we could benefit you and your company.
