Practices for the future

burgburg Experienced MentorGloucesterModerator, FMAAT, AAT Licensed Accountant Posts: 1,440
I thought I'd open up a thread about our practices and the positions we are currently in. I run a relatively modern practice and accountancy is changing massively now and over the coming months/years.

Please add information about your own practice and what you are currently doing and have done recently to change your offering.

I'll start us off with the first post but would love to hear about what everyone is up to.
Regards,

Burg
AAT_Teamreader

Comments

  • MarieNoelleMarieNoelle Trusted Regular Hampshire/Surrey borderModerator, MAAT, AAT Licensed Accountant Posts: 1,443
    Great post @burg and complements nicely the article in this month AT magazine "turn your practice digital".
    My own part-time practice is no where the size of yours and most of my clients are not remotely interested in new tech. Most of them are on cloud software though just because it's easier for me to monitor how their businesses are doing, I use mainly FreeAgent and AutoEntry but also use Xero and QB if the client is happy to do most of the bookkeeping. I have no plan to move them on another software at the moment as they will all be MTD ready (hopefully).
    I also work in another bigger practice where most accounts are still done on Excel spreadsheet or Sage - really not a big fan. The owner realises that there will be some challenges when MTD comes along, I am slowly trying to convince them that cloud accounting is the way forward but old habits are hard to change!

    Your offering is probably very attractive to a younger generation but our client base is either old school or not tech savvy. Things will have to change with the making tax digital drive but there is still a need to offer a more "traditional" service for some.
    readerTreadStonencacat
  • readerreader Experienced Mentor MAAT, AAT Licensed Accountant Posts: 1,035
    Really useful thread.

    We predominately use Free Agent at work. Nearly all the clients are on Free Agent however the remaining excel clients (circa 10%) will probably be migrated over in April 2019. We will probably help with the bookkeeping in the first instance until they are ready to take over.

    The practice has really stagnated, e.g. we don’t really embrace new apps, add ons, etc. I think becoming an app advisor will be very important in the future.

    We are better on GDPR in that we password protect everything or upload into a secure portal.

    The practice is very compliance orientated. Personally I am of the opinion that all these gurus talking ‘advisory’ are just trying to sell the emperor’s new clothes (especially for a practice like ours the predominately deals with 1 man band clients). I understand advisory is more valuable and a much easier sell when you are dealing with larger clients, e.g. turnover of £1m+.

    We have started doing newsletters more frequently, e.g. budget updates, etc. However we are not very active on linkedin, facebook, twitter, etc.

    However we should be doing more when it comes to tax advice, e.g. B shares, setting up rental agreements for use of home, proactively advising on R&D tax credits, creating SPV’s for BTL purposes, etc.

    Xero recently announced on Accounting Web that they will be offering an accounts and tax return submission service soon. This has caused some accountants to panic in that they are worried clients will just submit the tax returns themselves.

    We haven’t raised fees for ages just because there is so much cheaper competition, our service is very basic, client numbers are stagnating and new sign-ups are slowing down.

    With automation, MTD, Brexit, mobile banks with accounting software integrated e.g. tide/coconut, and IR35 all on the horizon for 2019/2020 I don’t think our practice is ‘future-proofed’ at all. I predict difficult times starting from 2020/2021 and onwards for practices like ours.

    It will certainly be interesting to see how things pan out in the next 24 months with so much going on. Definitely the most uncertain/dynamic time I can remember in my career.
    MarieNoelleburgTreadStonencacat
  • AAT_TeamAAT_Team Administrator Posts: 515
    Bumping this post as I think it's great, and I hope more professional members of AAT will share their experiences.
    burgMarieNoelle
  • CSan89CSan89 WiltshireMAAT Posts: 202
    As an employee (trainee accountant) I don't have as much say in how it is run at work however I have been able to push towards being more modern in the technology side of things.

    Firstly and currently I am sorting out our online presence as all we currently have is a website that belongs in the early 2000s.

    After that and whilst going through my training, I will probably have a better understanding on how we can help our clients and look at software from then.
    AAT Level 2&3 - 2016
    AAT Level 4 - 2017
    Personal Tax, Business Tax and External Auditing

    ACA/CTA -
    Certificate Level - Jan 2019
    MarieNoelle
  • NeillawNeillaw New Member RossendaleMAAT, AAT Licensed Accountant Posts: 241
    My practice isn't as big as burgs as I only have about 20 clients, this doesn't seem a lot but I do management accounts for a £30M manufacturing company. Quite a bit of time but it's regular together with good payments, rate is just below the temp contact level. My client base is predominantly made up from builders/plasterers and electricians.

    I also have a mentor who passes me work as he's now approaching capacity, bit of a JV really but it works well and it means he can bring in additional clients he would have usually turned down. Also done all my GDPR compliance and all I have to do for MTD is to test some excel bridging software.

    Payroll - Capium
    Accounts - Excel
    Accts & Tax comps - Taxfiler (cheapest option for number of clients)

    At my review at the start of last year I was actually looking to make an exit from the profession, I passed my diploma in Technical Analysis in the early part of the year and considered moving into investment banking. First priority was however to lose the fee moaning or tax moaning clients who just weren't worth the effort. These were informed I wouldn't be dealing with them anymore but kept enough clients to keep myself afloat..

    On review this year hasn't gone the way I wanted as I moved back towards a PAYE style appointment when I was looking to bring in new clients to gain more independence. My usual clients have all turned up later than usual but I have managed to bring in new clients with a higher income rate. Self assessment fees were increased last year without any problems, this time it will be Ltd company fees I will be looking into for a possible increase.

    Future
    This has been put into the issue at the moment:

    Hard Brexit - this would be leaving my biggest client which would significantly increase my capacity but reduce my revenue stream. Don't really want to be spending 2hrs a day stuck in a traffic jam or setting off at 7am just to get into their office in time. At the moment I can't get any additional management accounts work due to the company wanting the first week in the month and I've already been approached for a single day a week for a cost accounting project. It would mean that I would have the time to be able to put one day a week aside. Commercially this would be the best deal going forward with some initial financial pain to suffer.

    Soft Brexit/Remain - This would be the best financial package but not what I originally set out to acheive when I went self employed. I'd be tied down to the company only being able to bring in clients for the 10 spare days per month.

    For a single person practice it would be get January out of the way and then move forward with a positive business plan.




    MarieNoelle
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