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Virtual finance services: Build the infrastructure | Wolters Kluwer | image of a bridge being built

Virtual finance services: Build the infrastructure


Will Smart at Cottons Goup speaks with AccountingWEB's editor-at-large John Stokdyk, about how the firm’s people, processes and technology have evolved to support business advice and virtual FD services.

18th Apr 2023
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When the Covid-19 pandemic struck, businesses discovered how effective their accountants could be when helping them adapt to new business models, obtaining support loans and grants, and negotiating with landlords and suppliers to plug cashflow gaps. 

Practices of all sizes expanded their services to meet increased demand for more immediate business advice and complementary support services. These included regular bookkeeping, cash and cost management, business planning and other consultancy work. 

The pressures on business have not lessened since 2021 and this deeper client involvement is becoming the norm for ambitious accountancy firms. Will Smart, managing partner at Cottons Group, discusses how new people, processes and technology helped his firm adapt to these changes. 

Room for growth

In spite of the recent economic headwinds, Will Smart is “100% positive” about the opportunities for growth. “There’s still a Covid/economic hangover to come - we can see Bounce Back Loans and CBILS hanging around on balance sheets, so clients have got some obstacles to overcome. But threats present opportunities and we aim to help clients get over them,” he told AccountingWEB. 

Making Tax Digital was a turning point for Cottons, thanks to concerns that reducing the human input would cut back on the amount of compliance work. “That hasn’t gone in the direction we feared,” Smart said.

“The government changes actually mean that clients need more help with compliance, because their quarterly reporting requirements have increased. As a firm, we try to add value when we produce information – about what the numbers mean and how they can help the client run their business better.” 

That’s a big change from 20 years ago, when accountants would meet clients once a year to tell them how much tax they owe, he continued. “Now we have conversations each quarter about opportunities and threats on the horizon. It's been a natural progression that has evolved into a decent amount of outsourced finance work, producing budgets and various other kinds of information for clients. It’s not just about, ‘What are the numbers?’ It goes into areas like risk and projections, all of which you’d term advisory work.”

Technology has played a big part in the evolution of advisory services at Cottons. “We adapt and embrace technology to support that. It’s all come about from technology freeing us up,” said Smart.

Technology capabilities

That technology infrastructure comes into play not just with delivering advisory work, but also helps the partners at Cottons to run and expand the business. 

“One of our other pathways to growth is through acquisition. We did a deal with OakNorth Bank last year to help fund this strategy,” continued Smart.

“The systems and processes we have in place, and data on our own work and activities, is easy to access. If we buy other firms, we need to have systems, people and processes in place to make sure that integration is as seamless as possible. The acquisitions we go after are often accountants focused on compliance work. We aim to provide their clients with  compliance services painlessly as possible, and move them towards advice and complementary services.”

Automated data capture tools and cloud accounting provided the platform for offering virtual FD services and advice, according to Smart. “Embracing technology such as CCH Central made it a lot easier to outsource the finance function from the ground up. The basic work can be done with a touch of a button, which means we can spend more time on what those figures mean,” he said.

“We embrace automation wherever we can. So we’re implementing a new client relationship management (CRM) system to make the onboarding process less clunky and more pleasant.”

The new system will also give the firm a better handle on where its new work is coming from. “Data on clients and internal processes is gold dust for good advice,” he continued. “We look after so many clients, we can benchmark them to give better advice. It’s a permanent challenge to hold and look after data, and the humans handling it need to understand its importance. If used properly, I can write to 2,000 clients at once electronically. It’s hugely valuable.”

Overcome the obstacles

Data and client feedback are strong features of the Cottons culture. “We’ve got 10,000 clients. If we lose one, as managing partner I’ll pick up the phone to thank them for their business and work out what went wrong. If someone doesn't want to use you any more, it's important to get to the bottom of that. That’s the best feedback you can get,” he said.

For many firms, lack of the right skills holds them back from advisory work – particularly during the last 18 months or so. Cottons has been through the same struggle and responded by targeting and recruiting bright graduates. They are rewarded with competitive packages and strong people management that includes an emphasis on training.

“Good analytic skills are expected, but that doesn’t always mean they will make great advisors and accounts,” said Smart.

“Training structure is vital, but a tough thing to maintain because technology and regulation are always changing. These days, an employee in their early twenties can tell me a lot more about accounting technology than I can tell them. That’s a cultural thing too. We make sure there’s a CCH champion in each office who can make people aware of the best way to use the technology, and spread that knowledge around.”

“When I took over as managing partner in 2021, the biggest challenge was probably internal. We were already doing the work to turn Cottons from a network of successful, but independent, offices. The partners were doing a good job, but operating autonomously so people were doing things in different ways. Turning us into one firm, with one business support department, one marketing department and unifying these separate systems has made a big difference,” Smart explained.

“In spite of the changing technology, systems and processes, we’ve maintained the same culture. We’re still serving the same SME clients with small teams, supported by experts. And when we go for acquisitions, we look for firms that do the same. It’s no surprise that having a robust IT infrastructure is vital to all this – both internal and externally.”

If you want to see how Wolters Kluwer can help your firm build the right infrastructure to grow, get in touch.

Get in touch with Wolters Kluwer


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