Deciding to go?
Peter Towers
Founder of ESS BIZTOOLS Pty Ltd | Certified Public Accountant | Business Advisor | Mentor and Coach
The GIANT AWAKENING
The '2024 NAB Accounting and Financial Planning Report' revealed that 85% of surveyed Accounting Firms are “offering business strategy”, emphasizing the growing importance of Advisory Services in the Accounting Industry.
While the report highlights the significant role of ‘Advisory Services’, it prompts a crucial question: Is your Accountancy/Bookkeeping Firm prepared to ‘DELIVER BUSINESS ADVISORY SERVICES IN 2024’?
The journey toward enhancing Accountants' ability to provide broader Business Services began 40 years ago, with the establishment of the Financial Management Research Centre (FMRC) at the University of New England.
For over 25 years, ESS BIZTOOLS has developed comprehensive product packages tailored for Accountants and Bookkeepers, in the spirit of the principles established by FMRC and its Joint Founder and Accounting Industry Guru, Andrew Geddes.
These packages encompass a wide range of Business Advisory Services including team training and mentoring on the ‘Delivery of Advisory Services’, such as:
Business Systems: due diligence review of business operations to gain a ‘an inch wide and a mile deep knowledge of your clients’ business’, weekly performance report.
Predictive Accounting Reports: budgets, key drivers, cash flow forecasts, projected balance sheets, implementing virtual CFO services – financial controls, analysis of business performance.
Financial Accounts: monthly for all operations, comparison to budgets.
Business Reviews: financial report to monthly Board of Directors/Board of Advice meetings.
Assistance in developing clients’ Visions: business plan, strategic plan, business valuation.
Pricing Strategies, Charge Out Rate Calculations: Tradies, professionals, retail/wholesale.
Government Grants: R&D, export market development grant and many others.
Capital Raising for SMEs: Crowd Sourced Funding Equity Raising, Early-Stage Innovation Company.
Risk Management: PPSR, business risks minimisation strategies.
Business Activities: buying a business, selling a business, succession planning.
Business Analytics: business health checks.
Corporate Governance: corporate governance, Company Directors, Board of Advice.
Working Capital Management: Debtors, Inventory, SME Debtors Systems Manual.
Training Packages: SME needs analysis, monthly training webinars.
Promotional Material: Business Plus+ monthly newsletter for subscribers to badge and send to clients.
The offerings include detailed components such as due diligence reviews, weekly and monthly reports, strategic planning, business valuation, pricing calculators, government grant assistance, capital raising strategies, risk minimization, and comprehensive training programs. Additionally, promotional materials such as monthly newsletter and a library of support papers further enhance the Accounting /Bookkeeping Firms’ ability to ‘deliver Advisory Services effectively’.
In essence, this package positions itself as a comprehensive solution to ‘empower Accountancy and Bookkeeping firms to embrace the awakening giant of Advisory Services for SMEs’, providing a robust framework for delivering valuable business insights to clients and prospects.
Two Research and Development myths debunked
The notion that Research and Development (R&D) is exclusive to large businesses is debunked by a Federal Government report, revealing that companies under $20M in turnover are expected to earn a substantial $2.54B through the R&D Tax Offset in 2022/23. This implies that SMEs spent a significant $5.9B on R&D, with the offset being 43% of R&D expenditure. While the Income Tax Act outlines R&D rules, some accountants may avoid R&D questions, creating an opportunity for those offering Advisory Services to SMEs engaged in R&D projects.
The R&D process for SMEs involves progressing from an idea through a systematic workflow, including a 'Prior Art Search' to ensure uniqueness, documentation of core activities, and establishment of a hypothesis. An R&D Plan is submitted for approval, with meticulous documentation of experiments and results. Accountants and Bookkeepers can position themselves as facilitators in the innovation journey for SMEs by proactively promoting and assisting in R&D processes.
领英推荐
Contrary to a common myth, both successful and unsuccessful experiments qualify for the R&D Tax Offset, emphasizing the importance of maintaining appropriate documentation. The first lodgement is the 'R&D Tax Incentive Application’, triggering potential refunds for loss-making SMEs. With only three months remaining for the 2022/23 FY R&D Tax Incentive application lodgement, taking action is crucial.
If a company with a turnover less than $20M per annum is trading at a loss, the company can apply in its Income Tax Return for the ATO to pay the calculated R&D tax offset amount, subject to the company having accumulated tax losses in excess of the calculated R&D tax offset amount.
ESS BIZTOOLS has developed Research and Development Product Package to assist Accountants and Bookkeepers in delivering R&D advice to SME clients. An article titled ‘Research and Development from the Myth through to Creating Wealth’ is available for subscribers to share with SME clients and prospects. You can access a copy of the article below.
SME companies can raise capital, but they need assistance from accountants!
The myth that Crowd Sourced Funding Equity Raising is exclusively for public companies is debunked, emphasizing its applicability to private companies as well. Initially, only unlisted public companies could use this process for capital raising. However, amendments in September 2018 extended the privilege to qualifying private companies. Since then, private companies have become the largest users, raising over $289M for those with annual turnovers under $25M since 2018.
Some accounting firms are capitalising on this opportunity by offering services to assist companies in preparing for the capital raising process. This involves aiding entities in documentation preparation, including business plans for the next five years, predictive accounting reports, and leadership team training related to corporate governance and reporting to a Board of Directors/Board of Advice.
The Crowd Sourced Funding Yearbook for 2023 by ASIC-appointed Intermediary Birchal reveals that over 380 companies have raised capital since the regime's inception in 2018. Various industry sectors have participated in capital raisi ng, such as:
The total market cap for 2023 was $1.1B, (Birchal commented that this was the total value of all companies that completed successful crowd sourced funding offers in 2023) indicating the significant impact of Crowd Sourced Funding Equity Raising.
To assist companies in achieving ‘Investment Ready Status’, Accountants and Bookkeepers can play a pivotal role by mentoring directors and leadership teams on the rules relating to Crowd Sourced Funding Equity Raising, preparing required documentation, and ensuring compliance with legislation. Creating a website prior to approaching a Crowd Sourced Funding Intermediary can enhance a company's visibility and understanding among potential investors.
Additionally, the Crowd Sourced Funding Product Package developed by ESS BIZTOOLS offers support for Accountants to ‘Deliver Advisory Services’ in this domain, presenting a valuable opportunity for SMEs and accounting firms alike.
Will you take the step?
Now is the time to take this step – ‘DECIDING TO GO’ – to ‘Deliver Value in Advisory Services’ to your SME clients, which will assist your clients to operate better businesses and provide interesting and challenging work for your team, thus reducing the problem of ‘TALENT RETENTION AND ATTRACTION’, and enhance your firms reputation in the marketplace.
Visit our website – www.essbiztools.com.au – to explore the resources that are included within our packages. Alternatively, contact us on 1800 232 088 or email [email protected] to arrange a complimentary initial consultation via Zoom.
Best wishes for a successful 2024!
Want to know more?
Visit www.essbiztools.com.au .
If you would like to have a discussion about how this concept of virtual CFO services can be supplied by Australian accounting firms please ring our Managing Director, Peter Towers, on 1800 232 088 and we will arrange a complimentary 45-minute Zoom meeting to discuss your firm’s position and to give you our advice.
We believe that this is the blueprint for the delivery of an enhanced range of services by Australian accounting firms to assist SME businesses to add value to their businesses and to assist accountants not only to attract but to retain outstanding talent who want to be involved in the delivery of “real accounting services”.
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