Advisory Services Continue to Grow in Accounting Firms
Globally, more firms are have created or are interested in creating a more diversified selection of services, looking beyond the tax season to offering a variety of advisor services such as forecasting, budgeting, and strategy for their clients.
Mar. 21, 2022
Spotlight Reporting recently surveyed accounting professionals from the U.S., New Zealand, Australia, Asia, the UK, Canada, and South Africa to get a better idea about firm operations and upcoming priorities.
One of the key takeaways in the survey highlighted the continued need for advisory services. The survey also highlighted how valuable a trusted advisor is. And while many firms have added advisory services to their menu of services, other firms are still struggling to create a business model that likely looks very different from their current one.
This is not just a regional issue. Globally, more firms are have created or are interested in creating a more diversified selection of services, looking beyond the tax season to offering a variety of advisor services such as forecasting, budgeting, and strategy for their clients.
Though expansion is on the rise, firms are continuing to struggle with staffing issues, a key factor when deciding whether to offer additional services. Because of the ongoing talent shortage, more firms are beginning to provide additional benefits to potential employees such as a better work-life balance, which can help retain current staff and attract higher-caliber employees in the future.
Other survey results include:
- Nearly 80% of respondents plan on offering or expanding advisory services in the future
- 70% of respondents stated that they already perform mentoring, forecasting, or other advisory services
- Nearly 60% of respondents identified themselves as a hybrid firm; offering both advisor and compliance services
- Only 25% of firm respondents identified themselves as a traditional firm offering only tax and compliance
- 10% of firm respondents indicated that there are roadblocks that are preventing them from offering advisor services
Though a small percentage, the roadblocks these firms face can be significant. Roadblocks cited by firms include:
- Lack of time
- Not knowing how to start
- Not sure what to offer
- Unsure about pricing and competition
While these roadblocks may seem insurmountable, they can be overcome. Many experts believe that the best way to overcome these roadblocks is to just get started and work out any of the kinks during the process.
What areas do you want to grow in your firm?
If your firm mainly concentrates on tax and compliance, you may want to consider adding additional services. These are the top five areas that respondents indicated that they would like to grow in the next 1-2 years.
- Cash flow forecasting – 68.7%
- Strategic planning and coaching – 65.1%
- Virtual CFO and advisory services – 62.5%
- Ongoing accounting and assistance – 58.3%
- Budget creation – 55.3%
Of course, these aren’t your only options. You can offer payroll services, focus on cash flow management, or even assist clients with raising capital. You may also want to consider focusing on a certain sector, such as small business, nonprofit organizations, or franchising.
The options are limitless for firms willing to look past the traditional role that the CPA firm has played in the past. It’s up to you to change the future.
The full survey is available at Spotlight Reporting.
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