Practitioners will have to move out of the comfort zone if they wish their firm to be profitable and relevant in the near future. AdvanceTrack founder and MD Vipul Sheth explains why – and what you have to do to be valuable for your clients.
There is a sizeable proportion of practitioners who run ‘lifestyle’ practices. As owner-managers, lines will inevitably be blurred between how you live your life, and how those decisions impact on how your run your practice.
The term ‘lifestyle’, in this context, does admittedly have some negative connotations – of failing to spend the required amount of time or financial investment on the business. The vast majority of practice owners work hard and earn a decent living – but, in a time of great volatility (and competition), a focus on the practice as a business must be paramount.
And a key aspect of that is planning – looking forward. We have a government that is no longer handing out ‘free money’; in fact their current policies are about ‘squeezing’.
And then we have the digitisation of the tax system. While the self-assessment section of MTD has been delayed, there is an inevitability of both more frequent tax reporting and, ultimately, more frequent tax payments.
For businesses used to paying tax in arrears, then there will be a painful period in the not-so-distant future when we move to near-time payments – and that will mean a further cash crunch during the transition.
Digitisation, for the government anyway, is about both reporting transparency and collecting tax much closer to the transaction period.
HMRC will be able to assess situations more quickly – well, that will be its aim.
Time to prepare
So practices have to prepare. Your core compliance offering will become more technology- and process-led, but this doesn’t have to be all for the benefit of the tax authority. The beauty of all that information is, if used in the right way, you can create a more valuable and knowledge-driven service.
Helping clients improve their financial management is an obvious place to start, whether it is credit control or supporting the creation of management accounts. There is an array of services that will be driven by compliance. Growth often requires additional headcount and technology to happen, and such changes are not always easy for practitioners to deal with.
And, if you’re in a ‘comfort zone’ with your practice – it’s ticking along without actually trying to either win new business or expand/evolve its offering – then the future world will be really challenging. The government is ‘changing the rules’ as to what they want an accountant to do.
The development of the tax landscape is being made for the accountants’ benefit. But meeting the new brief does provide a catalyst for running your practice more successfully – and not just fulfilling compliance.
Finally, AdvanceTrack’s conference is aiming to enlighten and inform practitioners about how you approach transforming your practice. You hear from experts about building a vision, and inspiring you to make change happen. If you’d like to find out more, please click here. If you’d like to speak to us about your practice, please click here.