What You Need to Know About Accounting Advisory Services

This is my complete guide for accounting advisory services.

In this guide, I’ll review:

• What accounting advisory services are
• Why your firm should offer them
• The top advisory services to offer right now

So if you’re planning to offer advisory services, you’ll want to check out this guide.

Let’s get started!

Table of Contents

1. What are Accounting Advisory Services?
   
2. Why Should You Offer Accounting Advisory Services?
   
3. The Top Advisory Accounting Services You Must Consider
   
4. Accounting Advisory Services – Over to You
   

What are Accounting Advisory Services?

Every accountant seems to have a different definition of what “advisory services” consist of.

To keep things simple, I’ll define them as any service that provides advice to your clients.

If you focus on compliance, you handle financial statements, accounting issues, and statutory filings. 

However, delving into complex accounting, analyzing numbers, discussing future plans, and aiding in strategic planning moves into advisory work.

As such, these services can consist of simple discussions with your clients all the way to full-blown financial and reporting requirements (and everything in between).

Why Should You Offer Accounting Advisory Services?

For tax professionals, offering these services is vital due to high demand, which boosts revenue and retains clients.

As an online accounting firm owner, I’ve seen many small business owners struggle to use financial data for decisions.

A Xero study found low financial literacy among many business owners, especially Millennials and Gen Z.

Limited access to finance teams and technical accounting complicates achieving business goals. Accounting firms can seize this opportunity, given most clients lack in-house finance teams.

The survey also reports low grades in financial literacy attributed to a lack of knowledge in technical accounting and the absence of finance teams within the company for assistance. 

Without external support for reviewing complex accounting and reporting, achieving these goals will prove challenging.

Moreover, a recent Xero study revealed that firms offering advisory services generate 65% more revenue per client than compliance-focused ones.

To summarize why your firm should offer accounting advisory services:

1. Clients aren’t able to perform this kind of work themselves since they don’t understand technical accounting
2. The top goals for a large chunk of businesses are all related to advice on financial data
3. Your firm can add a significant amount of money to your top line

Popular Advisory Accounting Services

Below you’ll find a few advisory-oriented services that I think make a ton of sense given the current economic climate which also support the facts found in Xero’s report on financial literacy.

1) Include Health Check-Up Calls with Every Client

Clients hearing from their accountant only yearly, post year-end, surprises me.

Today’s business owners desire constant feedback; they’re highly connected. Getting advice once annually for tax planning or compliance services isn’t enough, as revealed by a Xero study where a third of millennial business owners heard from their accountant twice a year at most.

A straightforward remedy? Implement scheduled check-up calls in all your plans, reviewing financial reporting and technical accounting regularly.

This service is remarkably simple, enabling regular check-ins to keep both you and your client ahead of the game.

There’s nothing fancy required to the service:

1. Offer semi-annual, quarterly, monthly, bi-weekly or weekly health check-up calls. In a three-tiered pricing model, your Gold service tier might include weekly calls whereas your Bronze service tier may include semi-annual or quarterly.
2. Review all financial reporting issues before the call and come to the call with a few talking points.
3. Chat with your client about what’s new with their business and review your talking points.

That’s it.

This is an easy, valuable advisory service that gives your client insight into the numbers and to bounce ideas off of you and it arms you with information to maintain a closer, stickier relationship with your client.

2) Make Your Cash Flow Forecasting and Budgeting Repeatable

Advisory services are often seen as not easily scalable in the accounting profession, but that’s a misconception. When properly productized, they can be highly scalable.

Cash flow forecasting and budgeting services, if made repeatable, are my top picks for scalability. They’re popular with clients and can be effortlessly offered.

Interestingly, millennials’ key business goals, as per Xero’s report, align perfectly with budgeting and cash flow forecasting.

To make these services repeatable and charge a monthly fee, start by creating a 12-month forecast or budget based on past reports and future assumptions. 

Then, offer ongoing maintenance, updating the forecast or budget during regular meetings to reflect any business changes.

Though setting up the model initially requires some effort, maintaining and updating it afterward is straightforward yet incredibly valuable for the client.

3) Coach Your Clients

Transitioning from firm owner to accounting firm coach taught me key lessons in coaching.

Understanding and bridging “the gap” for business owners became a priority. This gap signifies the space between their current position and their desired destination—like a client aiming for a $5M revenue in 5 years from a $1M start.

Your role? Crafting a roadmap to reach these goals. 

As their guide, you’ll challenge, support, and ensure accountability while serving as a sounding board.

This advisory role isn’t just crucial—it’s essential. Many clients lack financial literacy, yet believe they’re adept at it, as revealed in the Xero survey. This misplaced confidence poses risks.

However, these clients hold high trust in their business advisors, creating an opportunity for you to step in as their coach.

Consider a streamlined coaching approach like Clarity, integrating financial KPIs, defining goals, and outlining action plans. Periodic meetings aid struggling areas and offer insights.

Coaching, when properly structured, becomes a scalable, high-value advisory service. I’ve seen success with a similar model in my online coaching program for accounting firms—it’s high-margin, valuable, and efficient.

Accounting Advisory Services – Over to You

I hope you enjoyed this guide. I believe the services mentioned above are highly relevant to what clients need help with in this day and age.

Now I’d love to hear from you.

Do you have a favorite advisory service?

What do you think of the online course model?

Do you prefer financial reporting based advisory?

Which advisory service will you be implementing first?

Let me know by commenting below!