Many Australian business owners are frustrated at not reaching their growth targets because they haven’t identified the need to transition from an accountant providing basic tax compliance advice to a business advisor who can help implement the right growth and profit targets via strategic advice.
Many smaller businesses only need basic accounting and tax services in the early days and can even get by with a bookkeeper rather than an actual accountant.
However, as businesses grow, their issues and needs naturally become more complex. At each stage of business growth, owners should assess the support and structures they have in place and consider if they are appropriate for where they want to take the business.
We have identified three stages most businesses go through when it comes to accounting and advisory services:
Stage 1: Compliance
An accountant or bookkeeper is required to document historical figures and performance of the business primarily for tax compliance purposes. They may be called upon to lodge tax returns and help ensure the business complies with all applicable tax regulations. This level of strategic advice may be all that’s needed for businesses with no growth aspirations or businesses that have only just begun operating.
Stage 2: Business insights
As the accountant gets to understand the business more intimately, they may be able to provide some business insights through big data dashboard reporting. This usually involves identifying and discussing the levers business owners can pull to achieve growth and profit. For many client/accountant relationships, this is as deep as it gets. However, for maximum success, businesses should look for an accountant who can do more than just shine a light on the levers to pull.
Stage 3: Advisory and Implementation support
In this stage, the accountant can provide advisory solutions to support clients to implement the right growth and profit strategies. Accountants that can play at this level are elevated from basic compliance providers to trusted advisors operating in the “inner sanctum” of clients decisions making, and can play a key role in assisting the business’s further growth through strategic advice .
Businesses usually get to where they have got because of the experience, expertise and skills of the owners and sometimes different experiences, expertise and skills are required to assist the business to go to the next level. While most business owners usually know what they want and where they want to take the business, sometimes they may struggle with how to go about this. This is often because they are time-poor and unsure how to maximise the value of their business.
Couple that with potential issues like cashflow and pressure on profitability, and even internal conflict around prioritising the right issues to focus on given they all compete for time, energy and funding.
We recommend these business owners seek accountants who go beyond basic tax compliance to assist with problem solving, managing risk of decision making and implementing the right profit and growth strategies.
Partnering with the right commercial and strategic advisor can position the business for exponential growth far beyond the business owner’s initial aspirations.
*This article first appeared on Inside Small Business and can be accessed here.
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