Understanding Your Clients' Challenges is the First Step

There are incredibly remarkable opportunities for today’s accounting firms that can be reached with a few tweaks in the traditional models for our industry.

We’ve seen the start of this as the word “consulting” has crept into the culture of some forward-thinking accounting firms. The next step is to actually fulfill this role by recognizing that a shift from purely transactional work to consultative work can build a practice. While this shift may not generate billing dollars, it can cement relationships with clients and build trust and long-term work.

In short, clients like to know we care.

This starts by continually monitoring business trends and responding with solutions.

For example, Intuit QuickBooks recently completed a global study titled “The State of Small Business Cash Flow.” The results were somewhat alarming, clearly showing that managing A/R is one of the most neglected business disciplines. Here are some of the findings:

69 percent of small business owners are kept up at night with concerns about cash flow.
One-third of small businesses have more than $20,000 in outstanding receivables.
The average outstanding accounts receivable is $53,399.

It’s no surprise there is a high failure rate for start-ups. So, what can be done to make sure these business owners can get a good night’s sleep?

In addition, it’s not unusual for companies to have great sales, but poor collections simply because they don’t have a disciplined approach to managing accounts receivable processes. Many small-to-medium-sized businesses fall short in these efforts, wrongly assuming that with sales come timely payments. That’s not entirely true. In addition, for many organizations sending out invoices and making collection calls are unpleasant tasks resulting in lack of action.

It’s important to take note of these trends and respond. There has been a growth in the development of “automated invoicing” systems that basically can become a firm’s in-house A/R department. We’ve developed a relationship with one – Biller Genie (www.billergenie.com) — that can be confidently recommended. Our clients appreciate our concern and if they succeed, we, too, ultimately succeed.

It’s all part of building this “consultative” culture into our firms.

The accounts receivable issue is a perfect example – and there are others — because it is the key to success. Many features can be built into this type of automated program. The key benefit is that companies can have an effective, functioning A/R department that isn’t cannibalizing payroll resources. These repetitive manual steps include sending invoices, performing follow ups on past due payments, sending payment confirmations, and reconciling successful transactions.

By automating these processes with solutions such as Biller Genie, our clients can efficiently and profitably implement these tasks.

By recommending and acknowledging that we have an understanding of our clients’ challenges and concerns, we are fulfilling an important role, that of a consultative partner. It’s an important step in cementing relationships that ultimately builds our practice while providing benefit to clients.

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Elgin Polo is a Partner with KSDT and Company, one of the largest financial accounting, advisory and consulting firms in South Florida. Mr. Polo focuses his practice on forensic accounting and business valuation services as well as tax and accounting services. For more information, visit www.ksdt-cpa.com.