Profiles of most accounting practices with fees of up to £3m would include a wide range of clients, explains Keith Underwood of Foulger Underwood.
These typically would fall into personal tax clients, sole traders, partnerships, limited companies and audits. Fees generated from the larger sized clients are usually critical in ascertaining the level of advisory and one-off work which the practice is able to secure from its client base and from which it will deliver a satisfactory service with in-house skill sets.
The number of SMEs is declining, there is a natural flow of retirements in various industries and the search for critical mass, in many sectors, has driven consolidation. The typical small accounting practice which once relied on its SME business for advisory services and which contributed to a significant part of its profit may not exist in the same format and in the same numbers compared to the early 2000s up to 2007. There will in the future be fewer SMEs, look at your own listings of clients in 2006-7 and compare it to 2013.
The cost of entry into almost any industry is now significantly higher than it was back in 2005 to 2007. New entrants will...