The British are a naturally hesitant bunch. Whilst the rest of Europe feels comfortable swapping bank accounts in the same way you’d swap mobile providers, in the UK we get twitchy and a Watchdog report in 2008 suggested consumers were more likely to get divorced that switch bank accounts.
It is much the same with professional services like Solicitors and Accountants. It is common to hear people refer to their Accountant who is at the other end of the country, who they have used since they lived there as a child – perhaps the same firm their parents used.
But there is a change afoot. The new breed of Cloud Based Accounting services like Xero and Kashflow are changing the way individuals and businesses choose their accountant. When my company launched we selected the Cloud Accounting package first, and then looked for an Accounting firm who had the necessary skills to use it appropriately. I wanted to pose some questions to Carl Reader of Accounting Firm Dennis and Turnbull to get his view on how these changes are affecting the Accounting profession.
Do you think the concept of “An Accountant for Life” still holds true?
Absolutely, but not in the way that it used to. Historically, clients of accountancy firms have stayed with their accountants through loyalty, or a perception that it is difficult to change accountants – much in the same way that they might have had the same bank throughout their adult life. Clients are now much more aware that this isn’t the case, and in fact qualified accountants who are registered with professional bodies have “clearance” procedures that simplify the changeover process.
Having said the above, I still believe that an accountant can be for life, provided that the service level is at or above the level that the client expects.
What attributes do the new breed of Accountants have?
To be able to compete the new breed of accountants will need to be able to step outside of the traditional comfort zone of financial ratios, accounting disclosures and tax rules, and have a much broader skill set – a small sample of these skills would include an understanding of marketing, sales processes, psychology / change management, technology, negotiation… the list goes on. More importantly, however, is the ability of the accountant to advise clients appropriately in these areas, and to understand their own limitations so that they can advise the client to seek further help where appropriate.
Attaining even a basic understanding of the above skills will require significant additional time investment into professional development, and of course it is essential that any accountant is fully competent in the basics of tax and accountancy.
Is Accounting still a localised service?
Not at all. In fairness, this has never been the case and accountancy / tax services have been offered remotely, however historically this would not have been common as accountants were under restrictions in relation to their advertising. These restrictions have been lifted, so there are now firms such as ours that are marketing nationally through Google and other methods.
Personally, my client base is spread across the UK, and I could relocate to any part of the UK and still be near to a similar number of clients. In the future, as cloud technology becomes more common place amongst the general business community, there would be no need to restrict this to the UK as theoretically I could perform all but the face-to-face work anywhere in the world.
Cloud Accounting brings a huge opportunity to firms like ours. I believe that customers of accounting software will choose their accounting provider based on the software they use, rather than based on location. This has been evident to me through our experience of being a leading firm of online accountants, as we are getting a significant level of leads from our online provider’s website.
Whereas in the past a client would ask their accountant about the software they should use (and invariably getting the answer “Sage”), they are now searching Google for this advice and finding online packages that are ranking above traditional packages. Many accountants have not yet embraced this new generation of software, and as such these business owners are left searching for an advisor who can work with their chosen package.
Essentially the Accounting package is now at the core of the decision process, just as you would service your Mercedes car at a Mercedes dealer, and then swap to a BMW dealer for a BMW car.
What are the leading Cloud Accounting Services that your clients use?
Primarily, my clients use a package called Xero, which is an accounting package developed in New Zealand. We do however have clients using other packages such as Kashflow, iCash and Freeagent.
I am a strong believer that accountants need to be aware of all software packages, and understand the strengths and weaknesses of each, so that they can offer appropriate advice to each client based on their needs. They do not need to be technical experts of the software, as ultimately that is what the technical support department are for!
There are many other complimentary packages that tie into a cloud strategy, including Dropbox, Echosign, Google Apps and Workflow Max. Longer term, I would imagine that even traditional PC-based software such as Sage and Microsoft Office will move completely into a cloud environment.
How has Cloud Accounting changed the way you interact with your clients?
In more ways than you can imagine – we have been able to offer the “accountant next door” service to clients in Inverness, Belfast, Cornwall, Kent, and pretty much every area in the UK in between these. We have been able to systemise our internal processes in most cases to increase efficiencies as a practice, and have also been able to deliver additional value to niche markets through the live data that we can capture.
But more importantly, our clients have been able to benefit from the reduced hassle of an accounting package that our team can also access – no more emailing spreadsheets, sending USB keys in the post, etc.
Just as my company is advising Business Owners to get familiar with new Cloud solutions like Google Apps and Salesforce to change the way they do business, as a Business Owner myself I would recommend taking some time to look at the new breed of Cloud Accounting packages. Don’t wait for your current Accounting firm to tell you – they might never get round to it.