Why small businesses deserve more from their accountants
Businesses have been relying on accountants for thousands of years – since ancient Mesopotamia in fact – and one of the world’s first printed books way back in 1494 was a treatise on bookkeeping (Pacioli’s Summa de Arithmetica, if you fancy a thriller).
Yet, from the abacus to the spreadsheet, the pace of change has been far from speedy. Much of the accountancy work done for small businesses in the early 21st century mirrors the bookkeeping and tax advice of Victorian number-crunchers.
This lack of innovation may be a serious problem for those small firms who rely on their accountant as a proxy FD.
So how do you know if you’re getting the best out of your accountant and using them in the right way?
In the past, business owners visited their accountant when it was time for tax returns or end of year accounts, but seldom consulted them on forward looking matters. And with the rise of software as a service (SaaS) and cloud computing, businesses have even less need to see their accountant to get the basics covered.
As business leaders can increasingly turn to apps, mobile and smart software to manage their accounts, the role of the accountant is having to rapidly evolve. The question is what do businesses miss out on if they lose the benefit of consultancy, and how can they get the best of both worlds – with real time tech for the basics, and knowledgeable insight for the commercial advice?
The ACCA recently published a global survey of 2,000 finance professionals (Professional accountants – The future) in which it identifies ‘digital technology’ as one of the four key drivers of change expected to affect the accountancy profession by 2025.
By 2020 (a date that has the ring of far off science fiction but that is in reality a mere three and a half years away) the ACCA say all professional accountants will need to develop ‘an optimal and changing’ balance of skills in the following professional quotients: technical skills and ethics, intelligence, creativity, digital skills, emotional intelligence, vision and experience in order to properly serve their clients.
Though business owners may have previously turned to their accountant primarily for tax compliance, expectations are shifting. Small business owners can now manage a number of these technical tasks themselves using accounting software and apps.
And as business owners automate these tasks, consultancy time is becoming more important. The most valuable role that an accountant can take in a modern small business is that of a virtual FD – more than someone to go to when things go wrong, but a specialist to help guide growth by advising on all financial aspects of a business – such as new funding options, to monitoring key performance indicators, to industry benchmarking.
If small business accountants can combine new digital tools with commercial chops, the UK’s entrepreneurs and owner managers will be truly set for success.
To find out how KPMG Small Business Accounting could help free up your time so you can concentrate on business success, request a callback for a quote today.
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