The bookkeeper and accountant relationship
There appears to be two very different types of relationship between the bookkeeper and the accountant, explains Mike Foster of The Entrepreneurs Mentor.
There is the collaborative relationship that works for all parties, being the accountant, the bookkeeper and the business owner. However there is then the non-existent relationship whereby any contact is kept at a distance and simply involves a handover for data processing. Based on new research, the reasons indicated for such a distant relationship were the fear of losing work, the lack of respect for another providers’ contribution and quite often a desire of seniority to control the client relationship.
A recent Any Answers post makes reference to the pace of change and provides examples whereby professional service providers consider their changing role as a specialist data inputter, a technical salesman or an interpreter.
It is clear that the role of accountants and bookkeepers is changing, as are client expectations. By working closely together better solutions can be found for all parties. For this to work every professional service provider needs to be honest about the true expertise and value they can offer. They can then strategically position their specialist role in partnership with other providers.
Twelve months ago it became clear that bookkeepers needed to adapt to survive. This has been further highlighted more recently with the fast-paced innovation of cloud based software. These developments are promoting to us all the opportunities of better collaboration. In my view, this collaborative working has always been the best practice to serve the interest of the business owner.
In these relationships there also has to be a clear understanding and respect for individual roles. For example, the day-to-day recordkeeping was kept by a qualified bookkeeper. Due to the daily detailed use of the software, the bookkeeper was better positioned to ensure the business was set up to best use the software. In addition, many bookkeepers are developing a more consultative role, running reports and generating information to help the business owner. For the business owner, the bookkeeper’s input is usually more cost attractive to them for this type of work.
However, good bookkeepers know the limit of their expertise and qualifications, so don’t just get attracted to the higher fee earning work. In the best case studies, the specialist role of the accountant then took over for the more complex management accounts, tax computations, tax advice and effective forecasting as well as for the accounts preparation and returns.
The better relationships demonstrate trust, and cross referrals are clearly evident. It’s a support network, where the bookkeeper feels the accountant is a reliable source of information, guidance and expertise. The accountant respects that the bookkeeper knows when to seek advice, rather than pick holes in their reason for asking. It was also clear from the research that the accountant knew the true value of the day-to-day work undertaken by the bookkeeper.
An understanding and respect for task ownership, with clear responsibilities, is important for any relationship to develop. Perhaps a more obvious, respectful, line between the roles should be created. Acknowledging each party’s strength will help build better relationships and, with greater client recruitment and retention, deliver long-term overall success for all involved.
One accountant said to me: “I allow the bookkeeper to do the recordkeeping. We could not offer this at the same price due to our overheads. We know and trust the quality of her work.
“We have in fact reduced our charge to the client, but still retain a high margin due to the minimal work that is now required of us. Overall the client is paying no more per year, but is receiving much more expert support. In return we have received a number of new business introductions and our business is growing profitably,” they said.
Mike Foster is founder and director of The Entrepreneurs Mentor.
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Mike is an experienced collaborative business leader and trusted new business development specialist. He is passionate about entrepreneurship, the marketing function and supporting other business owners with mentoring, training and business development activities.