What are the core functions of an accounting firm? The first thing that comes to mind is taxes. We all depend on well-trained and highly educated tax preparers to take on the onus of the annual Uncle Sam Pay Day. Whether you’re a business or personal tax client, your preparer requires all the financial documents obtained by the business or individual for the year. Through research and knowledge of tax code, those source documents are used to create a tax return. Knowledge is the key here, knowledge that the accounting firm specializes in to make that tax return happen quickly, efficiently, and in the best interest of the client.

This knowledge and core competency places the accounting office in a unique position to utilize new technologies and re-brand themselves as a real-time managerial accounting office for their business clients. The question is how best to achieve that re-branding. Adding CFO Services to your website along with a portal is window dressing only. To actually achieve this type of effective service the accounting office needs to ask the following;

  • What do we like to do?
  • What do we do well?
  • Which of our clients are best suited for this?
  • Of the best-suited clients, what parts can we effectively manage?
  • What changes do we need to put in place to achieve true re-branding?

To obtain a solid managerial accounting division within your firm, focusing on what you like most leads you to what you do best and then to the best clients that fit that vision. Finding a client and then attempting to work their needs into your abilities leads to chaos, exhaustion, and disappointment on both sides. Nothing will change.

I often hear accountants, when they consider trying to move into the realm of CFO-type services say, “I need to go out and find a new client to see if this works.” This appears backward. Rather than look for a new client, take a look at what you already have. There are some clients with whom you enjoy working, some whose business you find interesting. Some who really could use the help and no doubt many that see you as their trusted adviser.

Taking on the back office work does require a level of comfort on the part of both the business owner and the accounting firm. A client that has already provided you with access to sensitive financial data is much easier to work with than a new business with no previous relationship. Understand you will not be able to effectively outsource your client’s back office work to your accounting firm without on-demand access to information. This cannot work if you are waiting for someone in your client’s office to send the source information you require. This is a PROACTIVE endeavor. This is a relationship you will have with the client. Not your employees, but you! Your employees will do the work, but the relationship is with you and the client.

Prediction: in the next five years manual data entry of transactions for business will no longer be required. Review and verification, however, will still be needed. Start now to develop that relationship with your favorite clients in your favorite industry or verticals. Be the person in your firm who they call when they have a question and get paid for the value you return and not the data entry your employees will no longer need to perform.

For more on what it takes to be a CFO for your clients: http://www.journalofaccountancy.com/Issues/2009/Sep/20091501.html