The value of real-time relationships in a crisis
If the usefulness of real-time accounting was ever in question before Covid-19 struck, the pandemic proved without doubt how essential a live view of company financials has become
Ever-changing lockdown regulations at one time would have made it near impossible to forecast how the next month would go, let alone the year, but all that has changed with suites of cloud computing, automation and machine learning algorithms.
The ability to pick through data and walk clients through problems, using live views of cashflow, overheads, debts and tax estimates, is an evolutionary step in the profession that experts say has come of age during the current crisis.
Many accountants and bookkeepers say their clients are now finding they couldn’t live without the real-time approach, even if they initially took some convincing.
On-the-spot problem solving
“The main benefit I have found regarding real-time relationships is the collaborative aspect,” said Sage certified expert chartered accountant Martin Tregonning.
“If the client has a problem, you don’t have to swap data, or do backups, or even go see them. I can fix the problem, and share my screen so they can see what I did and learn how to solve it themselves next time. For those who still only use desktop, I cannot see their problem and often cannot help them immediately.”
He said it’s a two-way deal, however, driven by the client being able to keep the information up to date.
“There is a direct correlation between those who keep their data up to date and those who report getting the most out of real-time accounting,” he told AccountingWEB. “There’s a big difference between those who are just online and those who have bought into the other functionality which creates more advantages. You genuinely can see the difference.”
Early and disciplined data capture has proven key, allowing the accountant to act as an adviser and help measure progress when the picture changes day-to-day.
“Even down to simple things like looking at a predicted VAT bill for a year ahead, or having the ability to predict a tax bill for two years’ time, there are reports within the software that can be generated,” said Tregonning. “These kinds of predictions are not the impossible job some may think.”
The main reports clients want to keep their eye on are debtors, creditors, cash and VAT, he said. “These are the four they need instant information about,” said Tregonning. “They are increasingly needed in real time and this is where Sage excels.”
The value of analytics
The flexibility of modern technology stacks also builds on the use of reminders, notifications and alerts generated from real-time information, all of which can be used in a wide variety of ways to prod a client into action.
“Working in real-time ensures we have an efficient practice, but more importantly our clients are also running a tight ship with their systems and processes,” said Stefan Barrett of Bee Motion, a Sage cloud-only practice. “We have a dashboard that gives us the visibility to nudge our clients as and when we need to. As the business owner, they can use current data to make significant decisions instead of historic or outdated information.”
Barrett said clients can be categorised into the services they require, such as bookkeeping, payroll, VAT, company accounts and a director’s tax return along with mortgage or IFA advice.
“We will set processes in place where we automatically get notified when the service is due, and the job is delegated to the relevant employee,” he said. “This ensures we are being proactive and meeting all the deadlines.”
Understanding how to use machine learning tools and algorithmic software is becoming vital to better serve clients, he said, with clear evidence it has helped businesses chart a course for recovery post-Covid.
Bee Motion categorised its client base dependent on what grants were available, and linked directly to the government website to ensure relevant updates were automatically and instantaneously sent to whoever needed them. This covered all the available support from the government, including the furlough schemes, self-employed help, multiple grants, business loans, kickstart and apprentice initiatives and many others, Barrett said.
“There were times during lockdown one where we sent eight or nine emails a week,” said Barrett. “Our clients came back with really positive responses thanking us for our support and felt reassured that we weren’t only their accountants, but business partners getting through the uncertain times together.”
Simple tie-ups between accounting software and third-parties can also make a huge difference, added Tregonning, whether it is being able to send receipts or share documents and talk the matter through, to more efficient billing procedures.
“My people use Stripe for payments, for example, which integrates with Sage exceedingly well,” he said. “It removes book work, but it’s also a prompt - people are far more likely to pay when you make it easy for them. Five years ago, you wouldn’t have thought this possible.”
This also extends to real-time communications, he said, and having the flexibility to incorporate Zoom and Microsoft Teams, or even WhatsApp and other messenger services into the workflow to allow for the exchange of documents or ideas.
A recent Deloitte survey of CFOs found they expect home-working to rise five-fold by 2025 compared to pre-pandemic levels, forcing companies to adjust accordingly with better communication tools.
“To us, real time information is imperative, our whole fee structure is based on real-time data which is a new concept in the accounting world,” said Barrett. “This gives our clients the reassurance that if their business becomes quiet then we follow behind with a smaller monthly/quarterly fee.”
When the client’s business picks up, it is reflected within the firm’s workflow, he said.
“This gives our clients the comfort that their accountants monthly fixed fees wont adversely affect their margins,” he said. “We see ourselves as not just accountants, but business partners.”
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