The demand for advisory services has never been higher. When it comes to making their most important business and financial decisions, your clients want someone in their corner who has a varied and intimate knowledge of their business.
But what do advisory services in accounting look like? Most definitions of advisory services are vague to encompass a wide variety of services. But there are a few key categories to keep in mind if you want to implement advisory services at your firm.
Your clients need advisory services
Your clients need many different types of help, including how to make the best financial decisions for their business. Accountants transitioning into advisory roles bring industry experience, accounting technology, process expertise, financial acumen, and an understanding of the client to develop tailored recommendations.
You might already be providing tax and bookkeeping services, but chances are your clients have needs beyond that. Many small businesses want help establishing their financial goals, setting budgets, and creating financial forecasts to prevent unwelcome surprises.
Advisory services in accounting include providing expert recommendations, opinions, and strategies to help clients achieve their financial and operational goals. Financial advisory is all about filling in those other gaps.
A word about value-based pricing
Most accountants in the tax realm charge only for compliance services but inadvertently advise for free. When you offer guidance on different areas of their business, you’re providing advisory services. This means the value these tax pros offer their clients increases, but they are still only charging for preparing tax returns. Offering advisory services is a way to personalize the service to the client’s needs while they pay for the value of the provided services.
Which types of advisory services should I offer?
Just as you want your firm’s operations to run as smoothly as possible, your clients want their business processes to run seamlessly. Improving your client’s operations requires detailed knowledge of their business, comprehension of their working environment, and a deep understanding of the business’s goals. As an advisor, you help your clients establish better business practices by identifying existing problems in their operations and finding solutions to those problems.
You and your practice can help business owners prosper by providing advisory services, like:
- Tax planning and strategy;
- Technology implementation and maintenance;
- New business onboarding;
- Entity structuring (S corporation versus LLC);
- Officer compensation analysis;
- Management reporting;
- Cash flow forecasting;
- KPI dashboards;
- Document processing;
- Industry benchmarking;
- Payroll setup and implementation;
- Business performance reviews;
- Business succession planning;
- Process automation;
- Tax credit applications (R&D, Employee Retention Credit, etc.);
- Captive insurance suggestions and referrals;
- Strategic planning;
- Product price testing;
- Profitability consulting;
- Wealth management;
- Funding or capital raising assistance; and,
- IRS remediation or mitigation.
You may notice this isn’t listed as our traditional accounting references, like “write-up.” Being more specific around the work you are doing allows the potential client to read it in the language they know and realize they need it. When first beginning to offer advisory services, carefully define your selection of services and test which services would make sense for your firm to offer. Include the ones you enjoy or excel at — you don’t need to offer them all.
As we pay more attention to these skills and services, we can start creating new processes in our practice that deliver more proactive real-time analysis of our client’s business — allowing the technology to do the heavy lifting of the compliance work. Offering advisory services to your clients will enable you to align your revenue cycles so you are billing your clients on a recurring basis, meeting with them on their current issues and opportunities, and delivering an advisory relationship in which you earn a lifelong client because they can’t imagine not having you and your practice as a part of their business.
