Over the last year, accountants have had to increasingly spend more time emotionally supporting clients, providing financial advice and helping them navigate the turmoils of COVID. Accountants have acted as strategic advisors by assisting clients in identifying opportunities and challenges, understanding the government grants available, and creating a roadmap for survival.

Within the ever-changing financial landscape, accountants must adapt to provide even better services and stay relevant. After the last year, it’s not surprising that 70% of small business accountants see their advisory role becoming more strategic and 86% of small businesses currently consider their accountant their most trusted advisors.

Keep reading to learn more about:

  • Accounting advisory services
  • Changing trends within the industry
  • How accounting firms can offer advisory services

What are accounting advisory services?

Accounting advisory services go far beyond simply balancing the books. Simply put, accounting advisory services involve offering strategic business advice and revealing financial insights that ultimately influence clients’ decision-making and planning. 

Clients, especially small businesses, often want this type of support as they lack the necessary financial expertise or resources. In fact, research shows that 60% of small business owners don’t feel very knowledgeable about accounting and finances.

While the economy is starting to recover and businesses are re-opening, accounting advisory services are expected to continue to be popular as clients will still need strategic insights into their cash flow, help managing payroll and advice on how to thrive in the “new normal.”

Accounting trends in advisory services

COVID has drastically changed the accounting industry and accelerated the trend towards more strategic, advisory services. Today accounting firms must go beyond simple financial reporting to offer much more robust and strategic services. Research shows that:

  • 60% of accountants now provide strategic advisory services, while 26% offer outsourced/virtual CFOs services and 25% offer cash flow analysis.
  • 42% of small businesses expect their accountants to give them strategic advice.
  • 83% of accountants say their clients now expect more from them than they did five years ago.

The increasing demand from clients means accountants need to consider innovative ways to streamline their processes and automate time-consuming tasks like bookkeeping and invoice processing. Embracing a system like Countingup’s accounting software will allow accountants to spend more time consulting clients and less time on expensive admin.

How can accounting firms offer advisory services to small business owners?

Most accounting firms recognise the value of evolving existing accounting services to meet new market demands and remain competitive. Accounting advisory services offer one way to satisfy both while also ensuring clients are supported in the right way.

For accountants considering expanding their services to include accounting advisory, here are some of the best ways to add value.

Crisis management & contingency planning

As the old saying goes, “fail to prepare, prepare to fail.” 

Businesses, especially small businesses, need contingency plans to navigate predicted and unforeseen challenges. Never has that been more evident than in the last year, where many companies were caught unprepared and didn’t have the necessary cash reserves to survive.

Accountants have played an essential role in keeping companies afloat throughout lockdowns, government restrictions and a crashing economy. But, unfortunately, the pandemic is unlikely to be the last financial challenge for businesses.

As part of accounting advisory services, it’s important to help clients understand common challenges they may face and make contingency plans to weather any financial storm.

Budgeting & cash flow

Cash flow management and analysis are among the most common types of advisory services, which isn’t surprising given the importance of having enough resources in the bank. After all, cash flow is the lifeblood of a company.

Small businesses often struggle with cash flow problems. Research shows that poor cash flow has left 1 in 7 left small businesses unable to pay employees and 38% unable to pay debts.

Accountants can alleviate this problem by helping small business owners predict incoming revenue, outgoing expenses and creating a sensible budget. 

Once the budget is determined, accountants can use their skills and expertise to monitor cash flow and identify upcoming trouble-spots to help clients prepare accordingly. 

Retirement planning

For small businesses focused on growing their company (or surviving a pandemic), it’s easy to forget about saving for the future. 

As a strategic advisor, accountants should help small business owners understand the short and long game to plan for a comfortable retirement. Small business owners need to understand how much they need to set aside to maintain their current lifestyle into retirement and set up a pension plan to reach this goal.

Educate your clients and stay up-to-date

Accountants are uniquely positioned to help small business owners better understand their finances, make smart financial decisions, and create strategic financial plans. Whether it’s sharing a relevant blog article or industry insights, educating your clients should be an essential part of advisory services.

Educating clients also means accountants need to stay up to date and sharpen their skills. After all, providing accounting advisory services requires an in-depth knowledge of your client’s finances, industry and upcoming market trends. 

Stay connected to your clients with Countingup

Save your practice time on manual admin and help your clients keep organised records with Countingup’s free accounting software. Our software is full of features for accountants to review and manage client accounts efficiently, prepare journals and client taxes accurately with direct access to their real-time organised data.

Find out more here.

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