Practical Advice On Providing Business Advisory Services

29 June 2007

Note: The following appeared in the American Institute of Certified Public Accountants PCPS [Private Companies Practice Section] Brief, which was distributed to CPA firms across the country.

Small practitioners often develop close relationships with clients, getting to know their businesses and the challenges they face. That puts these CPAs in an excellent position to provide them with business advice on a broad range of strategic issues.

Unfortunately, many practitioners may be missing out on opportunities to consult with clients on the key issues facing their businesses – or they may be offering consulting advice already without charging for it. This month’s Brief will feature a practitioner and a consultant to the profession offering insights on how to provide business advisory services to clients.

How One Small Firm Set the Stage

At the eight-person Rigby Financial Group in New Orleans, CPA Eric Rigby has made a concerted effort to expand his practice beyond traditional services to include strategic planning and coaching. The firm provides audit and accounting and tax, mainly for doctors, entrepreneurs and small business owners. In his consultant’s role, Rigby also meets with some clients quarterly to help them assess their quarterly goals, their success in achieving the previous quarter’s goals and their plans for the near and long term. “We help clients shape their future by focusing on what they want to accomplish,” he says. He includes a variety of objectives in the discussions, including plans to sell their businesses, spend more time with family or transition to a new career.

“We create a list of strategic plans for the quarter,” he explains. They might include opening another office, hiring added staff or even building a new patio for their home. Then Rigby and the client determine what steps must be taken to achieve those goals, including a schedule to accomplish the necessary steps.

Getting Started

How can CPAs introduce such services or find out more about client needs? “Call them up,” Rigby advises. “Clients want this kind of help and they will pay for it. But practitioners have to go out and talk to them.” And the post-busy-season lull is the perfect time to do it, he notes.

Rigby advises that CPAs begin by taking their top 10 clients out to lunch. “Ask them how business is,” he says. “Are they saving enough? Do they have a retirement plan? A succession plan or buy/sell agreement? Do they need payroll help? Keep asking questions and you’ll find out what they want. Then start talking about the options they have and the financial solutions available to them.”

In fact, there’s probably a very long list of issues with which clients might need help, according to CPA Rick Solomon, president and CEO of RAN ONE Americas, a provider of technology-based business advisory solutions for accountants and advisors. They might include a varied range of challenges, such as:

  • Excess cash in receivables.
  • Low inventory turnover.
  • Cash flow problems or a lack of cash flow forecasting and monitoring.
  • No idea of the business’s value or how its results measure up against other similar companies
    Low profitability.
  • Poorly defined management roles or the absence of a management reporting system or well-defined organizational structure.
  • No strategic plan, no long-term vision for the business or a failure to communicate the business vision and goals to employees.
  • Lack of delegation or over-reliance on owners.
  • No system for customer feedback or a lack of customer service training.

Solomon advises that CPAs can begin by opening up a dialogue with one or two clients, then expand their business advisory service practice from there. When working with small to medium-size enterprises, he recommends five simple steps that can form the basis of a business advisory services relationship:

  • Perform a “health check-up” to diagnose problems.
  • Identify action steps based on what the check-up uncovers.
  • Develop an action plan.
  • Provide services to implement the steps in the plan.
  • Coach the client on ongoing issues.

The Client Education Process

Part of the process involves changing the client’s assumptions about your firm. “You have to make them aware that you are offering more than traditional services,” Rigby says. “Let them know you can help them look at issues from the 30,000-foot level.”

Solomon, who presented the May PCPS Practice Management Forum on business advisory services, suggests that CPAs accentuate the positive benefits of the advisory services they can offer. They include improved profits, enhanced financing opportunities, more efficient operations, better marketing options and new business development prospects.

Opening up a dialogue and educating a company about your services can work with prospective clients, too, even ones that are not typical. “It was my dream to have this one publicly held company as a client,” Rigby says. “So I wrote to the CFO and asked him how we could help. After Hurricane Katrina, there was a state program that compensated people for losses if they were uninsured or partially insured. The company hired us to hold seminars to teach their people how to apply for those grants.”

The First Step

Learn More at the AICPA Business Solutions Workshops
The AICPA Business Solutions Workshops cover everything CPAs need to know about launching business advisory services in their firms. You’ll learn about practical tools, techniques and skills for strategic client planning that you can implement immediately. For more information on upcoming Workshops, go to