By Ibi Ojo, EA.
The rapid evolution of accounting technology has automated traditional compliance work. Small businesses and accounting professionals benefit from artificial intelligence built into accounting software and apps.
As lower-level compliance work continues to be automated, tax and accounting professionals need to find meaningful ways to keep their services valuable to their clients, hence the evolution of advisory services to clients.
We need to show and help customers understand that automating compliance tasks is just a tool to get to the heart of the matter. Automation helps capture data efficiently, which frees us up to perform tasks that will add value to our customers’ businesses. Data becomes a report, with the ability to read, understand, analyze, interpret and communicate the information.
Reports provide valuable information
The report’s message is the primary goal of capturing the data in the first place, and that’s where the true value of the professional lies. We have the ability to turn the report into a powerful tool to help a business achieve its goals, including greater efficiency in operations and cash flow management. This is done by identifying shortages in advance and making adequate arrangements for capital profitability, expansion, growth and other areas.
Advisory work is future-oriented, while compliance work is historical. The consultancy work consists of knowing how to use the results of the compliance work to ensure a better future for the client. This is what is valuable to the customer: “wanting a better future” – an assurance that their business can survive in the future and has the potential to withstand an adverse climate.
With these types of services, clients view their accountant/advisor as a partner in their business. Clients experience better service and have a more personal relationship with their advisors when advisors are proactive in recommending strategies that lead to growth, profitability and success.
The result? Increased customer loyalty leads to long term retainers.
The reason? You can help your clients earn more money through consulting services.
Efficiency for a florist
What is in front of our eyes can be somewhat invisible to a business owner. For example, a thorough analysis of the financial condition might indicate a waste of materials, as in the case of one of my clients, a flower shop operating at a loss. Further investigation into the high cost of goods sold, with no corresponding increase in sales, indicated that the florist was ordering more materials than needed. Because the materials were perishable, they ended up in the trash.
This situation was quickly rectified: a system was put in place to order the right amount of materials, eliminate waste, reduce cost of goods sold and increase gross profit.
A comparison of the monthly income statement may even reveal more problems; for example, if the rent or a mortgage payment is not made. Timely payment of bills saves late fees, interest and penalties which could add up to a significant amount.
By using the appropriate ratios, capacity inefficiencies would be revealed. Addressing this issue and putting a system in place would make more money with the current capacity.
A cash flow analysis is also very important to ensure funds are available at every stage of operation. When identified in advance, shortages can be resolved and also allow the customer to seek the cheapest cost of capital.
Automate your processes
All the tasks that you continue to do by hand and that the software can do more efficiently cost you time, resources and money. Cloud solutions allow us (the client and the advisor) to optimize our processes. Helping our clients build a technology stack for their businesses enables them to operate more efficiently, profitably and competitively. When customers automate some of their processes, it frees up their employees to focus their time and talents on revenue-generating activities.
When customers use a full suite of business applications, they can expect these five benefits:
- New operational efficiencies.
- Increased productivity.
- Increased profitability.
- Improved ability to scale operations.
- Greater potential for revenue growth.
While there are sophisticated reporting tools to capture every aspect of the business, the information contained in reports enables our clients to make more informed business planning decisions that increase efficiency and profits. Reports must be interpreted by an advisor. The ability to interpret these reports and effectively communicate what they reveal about the business includes the company’s performance, the client’s position in the industry, upcoming opportunities and challenges, and how to address them. deal with in an adequate and timely manner.
Providing this information is an invaluable service to the customer. Our businesses succeed and have greater value when clients can associate our services with increased revenue and profitability.
Ibi Ojo, EA, is the owner of Fortune Accounting and Business Solutions, a full-service accounting, consulting and training company. A QuickBooks Certified Advanced Business Advisor, her favorite part of her job is interacting with clients and recommending strategies to help them achieve their goals. Ibi has worked with QuickBooks for over two decades, loves everything about QuickBooks Online, and uses Intuit ProConnect Tax. His QuickBooks training courses were born out of his passion for helping small businesses keep better books and get reliable reports that can be used to make decisions that will help them grow and be profitable. In 2020, Ibi was nominated for the “Top 50 Women in Accounting” and recently became a member of the Intuit Trainer Writer Network.