Is compliance work more valuable than ever to small business clients?
30th Aug 2019
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In over 10 years of working with accountants, I have read a lot of articles/whitepapers giving advice to accountants on how to improve their practice in almost every area. Generally, the advice is really helpful and there are some great experts in this area.
There is one school of thought though that I don’t fully subscribe to. That is the often made declaration that “compliance is dead”. This might sound strange coming from somebody who has spent the last 6 years leading teams that work with accountants to implement technologies that have definitely disrupted compliance work. However, let me explain why I think compliance work still offers a great opportunity for accountants.
There’s no doubt that compliance work has been hugely disrupted by technology. For clients using products like Countingup a lot of the data entry around bookkeeping is done automatically or with a few clicks on a smartphone. This means that the amount of manual work or assistance needed to create data has reduced.
The reduction in the manual work required obviously means that many clients may not need as much support with bookkeeping. So the question to be asked is “why do business owners and the self-employed first decide they need to use an accountant?”.
I’ve asked this question to many accountants over the years. Whilst there have been many responses generally the most common one runs along the lines of “they want to make sure they are doing things right and don’t get into trouble”.
For many businesses, it may be possible to upsell them “advisory” work such as management accounts and forecasting. However, for a sole trader, such as a tradesperson, with a turnover under or just over the VAT threshold (there are over 3 million such people!) these types of services are probably going to be harder to sell.
That makes a lot of sense. Setting up a small business requires a lot of hoops to be jumped through. If you’re a sole trader you need to register as self-employed, if you’re running the business through a limited company you need to go through the formation process. On top of that, you’ve got other industry-specific requirements such as Buy to Let landlords now needing to be registered. All of these need to be addressed before we even start thinking about final accounts and tax returns.
In summary, the compliance burden on small business owners /the self-employed seems to be increasing rather than decreasing. (I’m not going to include MTD here as that is covered extensively elsewhere). With that in mind, the value of accountants delivering compliance work efficiently is increasing.
If you’d like to chat through how I’ve seen many accountants do just that, please do drop me an e-mail. My address is [email protected]