Compliance is dead, long live compliance
To paraphrase Mark Twain: reports of the death of compliance have been greatly exaggerated.
Compliance is routinely pronounced dead at conferences, in social media posts, or any gathering where an accountant is in earshot. Those reading aloud the obituary of compliance often do so in the same sentence as promoting the need for accountants to develop advisory services. Accountants who don't comply are told that they too will suffer a similar extinction.
However, Cheap Accounting's Elaine Clark is one accountant who is fed up with this compliance bashing. She has (figuratively) tied herself to the pillar of compliance and has taken to social media to profess her love of the beleaguered accounting work.
The bread and butter of the profession
“Compliance is the backbone,” Clark told AccountingWEB. But banging the drum for compliance should not be seen as a snub against advisory. The two complement each other.
“It is the bread and butter of the profession upon which other services are built and sold because compliance provides you with the information, knowledge, understanding and touchpoints with the clients to make the selling of advisory easier,” said Clark.
More profitable advisory services are dangled in front of accountants as they’re told compliance is declining. But Clark said these compliance-ditchers would resemble a consultancy firm, not a firm of accountants.
“It’s like telling an undertaker to forget burying bodies and instead sell hymns,” she said.
Starting my "Calling out the Compliance Disparagers” personal campaign
It's what clients want
It is profitable
It provides regular income
It's the backbone of accountancy
RT if you agree pic.twitter.com/tHwsO3M5K3
— Elaine Clark (@cheapaccounting) October 30, 2018
Is MTD the death knell for compliance?
Feports of the decline in compliance is driven, in part, by the forecasted effect automation, AI and Making Tax Digital will have on the profession. With all the noise generated by the compliance naysayers, it is perhaps understandable why some accountants are concerned. The fear is that a lot of compliance work will be automated, so what will this mean for their fees? It’s no wonder the advisory voices are getting louder.
But as someone who recently joined the advisory board of banking and accounting app Coconut, Clark is not concerned by the effect technology will have on compliance.
“Computers should be used to automate processes that don't need intelligence, or where you can use AI do those things,” reasoned Clark. “What we as accountants need to do is keep looking at the tools, techniques, and technology out there to allow us to deliver a cost-effective service to compliance clients.”
If anything, the government’s digital dreams will breathe life into compliance work. Seeing the move to digital reporting in his home country Australia in 2000 with GST, From the Trenches podcast host Paul Meissner expects the UK to see the greatest period of compliance work in the last 10 years.
Responding to an AccountingWEB tweet that referenced the decline of compliance phrase, Meissner retorted: “Advisory will come to a standstill as MTD rolls out.”
An appearance on BBC Radio 4’s Moneybox Live with some puzzled business owners cemented in Clark’s mind the need for accountants embrace compliance work in a post-MTD world. “It's amazing how the business community hasn't been educated on what their compliance responsibilities are going to be from April next year," she commented.
Stand up for compliance
Clark’s ‘I love compliance’ campaign has received backing from other small practice supporters on social media. ICPA’s Tony Margaritelli said: “It’s what we do and we don’t make a song and dance about it like our adviser and futurist colleagues. We need to stand by what we do and not be talked down to.”
The ‘compliance disparagers’ are part of the negative noise that Clark believes is adding to the stress levels of sole practitioners and small firms. “If a sole practitioner or small firm wants to be 100% compliance they're not wrong. There is a valid place for them to exist in the accountancy profession and we have to stop kicking people.”
Software insider Phil Sayers also questioned on an AccountingWEB article the notion that advisory is the beacon all accountants should pursue. “Accountants need to decide whether or not this is an area they want to get into. After all, you wouldn't suggest that a client radically changes their business model if this flies in the face of the client's personal and business objectives.”
What side do you stand? Are you flying the flag of compliance? Or are the reports correct - is compliance in terminal decline?