A modern accountant’s guide to client accounting services

Client Accounting Services – also known as Client Advisory Services, CAS, or CAAS – focuses on providing advisory services rather than the compliance services that typically characterize accounting.

There is considerable demand for advisory services: a 2020 CPA.com report found that 68% of accounting clients would like their CPA firm to provide them with strategic advice if price were not an issue.

According to the second and final customer advisory service Baseline survey according to CPA.com and the AICPA’s Private Business Practices Section (PCPS), CAS firms “grew at a median rate of 20%, nearly twice as fast as the 12% reported in the 2018 survey. This is more than three times the average practice growth of 5.7% reported by other benchmark 2020 CPA firm surveys.”

Definition of Accounts Receivable Services

The AICPA and CPA.com define client advisory services as “a practice in which firms advise clients on a range of financial and accounting decisions, with the goal of delivering superior value and deepening the relationship of trust with the advisor”. To provide the proactive and in-depth information needed to run a successful CAS practice, CAS professionals leverage technology and efficient processes. These practices rely on outsourced accounting services such as bookkeeping and financial statement preparation, but also offer services such as business process outsourcing, outsourced controller or CFO services, including forecasting and business modelling.

The five most common accounts receivable consulting services are: financial statement preparation, accounts payable, CFO/controller consulting services, budgeting/forecasting, and payroll services. Rather than simply ensuring that a client’s tax return is properly prepared and submitted on time, CAS firms review the return and ask how they can add more value and perspective.

To have a CAS firm, you need to change the accounting discourse – you are no longer selling your time; you are selling your knowledge and expertise. CAS firms look to the future, helping their clients stay proactive and make the best decisions for their business. But that doesn’t mean giving up compliance services. A good way to visualize this relationship is that the compliance side is like the cake and the consulting services are the icing.

Why offer CAS?

Over the past few years, we’ve seen a massive increase in remote work and technology adoption. According to a study“78% of small businesses say they would consider changing accountants to one using the latest technology.” Accountants and their clients are more comfortable working hand-in-hand without consistent face-to-face interactions and are increasingly sharing sensitive documents online, which has made it easier for accountants to create an ongoing partnership to deliver advice and provide proactive expertise. CAS Baseline Survey found that CAS companies had strong profits that outpaced traditional practice areas by 6-13%.

Below are some things to consider when evaluating if CAS is right for you:

  • Increased opportunities to add value for customers. Compliance work is often systematic and clearly defined; However, when providing consulting services, every customer touchpoint is an opportunity to find more value and potentially offer additional services.
  • Technology is essential to the successful operation of CAS. In order to benefit from running a CAS practice, it is essential to leverage the benefits of the cloud and other technologies. Technology enables accounting professionals to significantly reduce the time spent on administrative tasks, allowing them to spend more time providing more clients with higher value services such as proactive advice.
  • Fixed price model or value price if possible. Advisory work is very different from compliance work because it is continuous, proactive and potentially less time-consuming. Therefore, charging an hourly rate for the exceptional knowledge you provide to clients does not do justice to you or the work. Defining several packages from different prices, with a margin of customization is a good starting point. And with this type of subscription-based pricing, every time a customer interaction occurs, you’ve already been paid. This can create better relationships with customers because the cost, what is owed and the value offered by the accountant are defined in advance.
  • What business model works. Before moving into offering consulting services, companies should spend time considering what business model they would need and what changes would be required.
  • CAS probably means cash flow throughout the year. Monthly upfront payments mean cash flow is no longer seasonal and no longer dependent on tax season. Instead of giving your client their tax return once a year, you can provide a report of all the money you’ve helped them save and important decision-making information they need for their business. .
  • Specialization helps considerably. Because CAS accountants know their clients’ businesses intimately, CAS firms typically choose to specialize in one or a small number of niche markets.

Integrating consulting services into a traditional accounting firm is not easy. There are many things to consider and because starting a CAS practice is such an important undertaking, companies need to fully commit to it for it to thrive. However, once the move is complete, the benefits are significant, and with changing customer expectations, it’s a real differentiator.

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