The Commonwealth Bank’s “Accounting Market Pulse” has predicted that business advisory services will be the number one service line to enter and grow for accountants in the next 12 months.

Business advisory services will help offset the losses from the introduction of the Australian Taxation Office’s Standard Business Reporting (SBR) and offer accountancy businesses “real accounting work” for accounting team members.

To assist accountancy businesses to get ready to deliver business advisory services, ESS BIZTOOLS is progressively releasing significant upgrades to the ESS BIZTOOLS’ product range, including:

The ESS BASIP Training Package for Business Advisory Services – Introduction will be available as a stand-alone product for an investment of $660 (including GST).

This change will enable accountancy businesses to invest a smaller amount of money, whilst the training of the team members is being undertaken.

Then the individual Business Advisory Services – Products will be able to be acquired or the accountancy business could then subscribe to the ESS BIZTOOLS’ Gold Package, which includes all products and services supplied by ESS BIZTOOLS.

If the accountancy business elects to upgrade to the ESS BIZTOOLS’ Gold Package within 4 months of subscribing for ESS BASIP Training Package, a credit will be granted for the amount paid for the ESS BASIP Training Package.

To celebrate the release of the individual packages, ESS BIZTOOLS is offering a 20% discount for the Gold Package, which is now at $2,376 (including GST), normally $2,970 (including GST). This offer is available until 30th April 2016.

The ESS BASIP Training Package includes:

• Training videos
• Transcript of the training videos
• Invitation to participate in 4 free group review webinars
• Complimentary issues of Business Plus+ newsletter for 4 months – you can badge with your firm’s name and send to your clients if you wish

The ESS BASIP Training Package includes 11 modules, to assist an accountancy business to get ready to deliver business advisory service. These 11 modules are:

• Module 1 – Introduction to Business Advisory Services
• Module 2 – Getting Organised for Business Advisory Services
• Module 3 – Team Training for Business Advisory Services
• Module 4 – Leadership Strategies for Business Advisory Services
• Module 5 – SME Needs’ Analysis
• Module 6 – Marketing Strategies
• Module 7 – Review of Products
• Module 8 – Planning Seminar to Launch Business Advisory Services
• Module 9 – Selling Business Advisory Services
• Module 10 – One-on-One Meeting
• Module 11 – Implementation of a Business Advisory Services Strategy for your Clients

The ESS BASIP Product Packages will comprise of:

• Templates, articles and other material relative to that particular product
• Training videos
• Transcript of training videos
• 1 complimentary group webinar

The ESS BASIP Product Packages will include the following Business Advisory Services – Product modules:

• Debtors’ Management – $440 (including GST)
• SME Debtors’ Systems Manual – $240 (including GST)
• Chief Financial Officer Services – $550 (including GST)
• Personal Property Securities Register Due Diligence System – $550 (including GST)
• ESS BIZGRANTS – $495 (including GST)
• Succession Planning – $385 (including GST)
• Business Planning – $550 (including GST)
• Budgets and Cashflow Forecasts – $275 (including GST)
• Cashflow Management – $275 (including GST)
• Strategic Business Mentoring – $330 (including GST)
• Business Health Checks (per individual industry review) – $220 (including GST)
• Selling a Business – $330 (including GST)
• Buying a Business – $330 (including GST)

The ESS BASIP Product Packages will be available to purchase on an individual subscription basis from 8th March 2016.

We’re presenting webinars, on a weekly basis, to discuss various aspects of Business Advisory Services. We invite you to attend these webinars, free of charge, to get a better appreciation at what’s contained within these products. Click on your preferred webinar below to register to attend.

• Be Proactive - Offer a Grant Finding Service to your Clients - Thursday 25th February 2016 - 11am AEST (12pm AEDT)
• Delivering a Business Package to your Clients - Tuesday 1st March 2016 - 11am AEST (12pm AEDT)
• Why Offer Business Advisory Services? - Tuesday 8th March 2016 - 11am AEST (12pm AEDT)
• Starting in Business Advisory Services – Friday 11th March 2016 - 11am AEST (12pm AEDT)
• Business Advisory Services - Products - Ready for You to Use - Monday 21st March 2016 - 11am AEST (12pm AEDT)
• Building a Virtual CFO Service - Wednesday 30th March 2016 - 11am AEST (12pm AEDT)

Opportunities are all around us. Some people see them, other don’t. Life is all about taking advantage of our opportunities when they’re presented.

Once a year, there’s an opportunity to go away on a 100%, fully tax deductible trip for 3 days of workshop activities with like-minded business operators, with mentoring from experienced accountants, business people and other advisors from all over Australia.

You’ve all heard of the concept “working ON your business”.

A Global Business Camp is a great opportunity to “work ON your business”, with a group of like-minded people.

One of the real benefits of a Global Business Camp is that your clients can communicate with other people who have already experienced the same or similar problems and issues that they’re finding in their business. They will be able to have discussions, get some ideas and develop strategies.

The failure rate of small business is very high. Dun & Bradstreet claims that the failure rate is approximately 48%. Bloomberg stated that 8 out of 10 businesses fail over time. Why do businesses fail?

We’ve identified the following 5 reasons for failure:

Reason 1 – not in touch with what customers want and lack of communication

Are you asking your customers what else you can be doing for them or how happy they are? Knowing the strategies is half the battle.

Reason 2 – no real differentiation in the market

What is your unique core differentiator? How are you different from everyone else in your industry?

In today’s environment, businesses need to be identifying their unique competitive advantage and then continually promoting that advantage to the marketplace.

Reason 3 – failure to communicate value propositions in a clear, concise and compelling fashion

Are you communicating with your customers via Social Media, letters (yes, snail mail) and websites? Do you visit your customers’ premises?

Unfortunately, in the helter skelter of a business life, many business operators are not communicating with their customers at all.

Reason 4 – leadership breakdown at the top

What leadership style do you have? How dysfunctional is your team? Does your team know where your business is going and why? This is critical information that your team members need to know.

Reason 5 – inability to nail a profitable business model with proven revenue streams

What changes may you need to make to your business model in this ever-changing environment?

“Digital disruption” is upon us. One of the major accounting groups in the world, has indicated that businesses need to develop “alternative revenue streams”. This is one of the key ways of combating “digital disruption”.

• Have you made any changes to your business operation?
• How is your business performing compared to your budgets?
• Do you have budgets?
• What changes to the bottom line would a small percentage increase in turnover make to your business?

These are the key issues that are confronting businesses today. There are undoubtedly many others, however these are going to be some of the key issues that are discussed at workshops within the Global Business Camp, which is being presented at the Gold Coast on the 14-16 March 2016.

We have negotiated a special VIP rate for business operators and accountants of $2,200 (including GST) per person, normally at $2,970 (including GST) per person.

If you require further information on Global Business Camps, so you could take advantage of the special VIP rate, click here. Alternatively, click here to view a presentation by John Tsoulos, Managing Director of Global Business Camps.

Accountants can attend the “camp”, free of charge, if they introduce 5 business people who pay the VIP rate to attend the camp.

Have you ever wondered what a Business Development Manager (BDM) does?

BDMs are continually looking for new businesses to keep feeding the customer pipeline into a business. BDMs identify organisations in the marketplace and then seek to make contact with them for the benefit of their employer business or their client. This is a very important role for businesses to think about, having someone who is concentrating on developing new customers.

BDMs:

• identify business opportunities
• facilitate deals
• supply marketplace feedback
• attend networking events
• are involved in social networks and community events
• prepare editorials for magazines
• provide information for Facebook business pages

The prime role of a BDM is to approach individual organisations and governments to encourage them to do business with their employer business.

There is some crossover into marketing. Larger organisations work with their marketing manager and the CEO, to understand where new businesses might be able to be found. They then go out and try and find new prospects so that the organisation has new prospects, new clients and new business coming in to an organisation.

It’s very important that businesses have the right sales culture. This relates to realistic, timely and achievable sales strategy and that the business has the right kind of people on your sales team. A BDM is very important in this process.

Moira Verheijen, BDM of Corporate Connectors and Gallop Solutions, presented a webinar, featuring “How does a BDM add value to a Business”. Click here to view the presentation.

Gallop Solutions is making a special offer to business operators.

You can apply for 2 complimentary tickets to a Gallop Solutions Discovery Seminar, available to the first 10 callers, normally $438.90 (including GST). Contact Gallop Solutions on 0488 335 300.

The changes that have been introduced enable accountancy businesses to purchase individual components of ESS BIZTOOLS when it suits you. Alternatively, you could subscribe to the ESS BIZTOOLS’ Gold Package, which includes all components of the services offered by ESS BIZTOOLS.

You’re invited to sign up for a no-obligation 30-day trial of ESS BIZTOOLS, whereby you will be given the opportunity to test the system. Click here to try ESS BIZTOOLS for free, or visit www.essbiztools.com.au.

As a preview of what’s contained within the ESS BASIP Training Package, a complimentary copy of the February 2016 edition of the Business Plus+ newsletter is attached with this transcript. Please feel free to utilise this newsletter, rebadge with your firm’s name and logo and distribute to your clients and prospects.

If you have any questions on ESS BASIP, or any aspect of ESS BIZTOOLS, please don’t hesitate to contact us.

Peter Towers

Managing Director

1800 232 088

[email protected]

www.essbiztools.com.au

Situation AvailableMany businesses have a “situation available” for a wider range of services – but not many accountants are applying.

What services do SMEs want?Surveys undertaken by MYOB, CCH, Smithink and other organisations have all identified that SMEs are looking for a wider range of professional services from “someone”. The challenge for the accountancy industry is to ensure that “someone” is a professional accountant. This work will otherwise disappear to a range of other consulting firms and to those accountancy businesses that are better prepared.

The services, indicated by the surveys, as being sought by small/medium enterprises include:• Future planning – where are we headed?• Budgets and Cashflow Forecasts – trying to predict the financial needs of the business.• Business analysis and interpretation:- Key Performance Indicators- Benchmarking- Ratio analysis• Succession/Exit Planning - there are thousands of businesses that are planning, or considering, exiting over the next decade. Succession is not just when someone wants to retire. Succession applies virtually throughout the entire business structure. This involves an enormous amount of work.• Management of Costs – would you be surprised to know that in the CCH survey, conducted a couple of years ago, “management of costs” was identified by the 1,200 small/medium enterprise operators interviewed, as being their single biggest problem. Is your firm offering a “cost management services”?• Management Monitoring – this is a growing issue. I have been involved in various management consulting assignments funded by Federal government programs over the last twelve months, highlighting that even government agencies have identified that this is an issue for small/medium enterprises….. but have accountants?• Business Plans – are like maps for tourists…. if you don’t know where you're proposing to go, how are you going to know when you get there? More importantly, how is the business operator to know when corrective action needs to be taken during the business journey?• Assistance in Raising Capital – is your firm proactive in assisting your clients to get ready to be able to make investment pitches to Business Angels, Venture Capitalists etc.?• Grants available for SMEs – the Federal, State and Territory governments have allocated $5B per annum for grants, special loans and incentives. All of your clients are contributing to this grant fund through the taxes they pay. How much money are your clients securing from the grant funds that they have helped finance?

What other services could be offered?What other services could you offer to supplement the particular services that have been identified by SMEs?

My suggestions include:

Debtors’ ManagementAccording to Dun & Bradstreet, debtors' days outstanding are currently 51.8 days. A business with a $2M turnover has $5,479 tied up in debtors for every day debtors are outstanding.

Do you have clients with debtors’ days outstanding around the average of 52 days? With some debtors’ management advice, this figure could be reduced back to 42 days. This would save your client $54,794.

Cashflow ManagementCashflow management is not just preparing a computer spreadsheet; it requires some analysis to review:• Debtors’ Days Outstanding• Stock Turn Rates• Capital Expenditure Program• Debtors’ Factoring

Personal Property Securities Register Due DiligenceOver $40M has been lost already by small and large businesses through Court cases relative to the Personal Property Securities Act and the Personal Property Securities Register, with millions of dollars lost in uncontested court cases.

If accountants are the “trusted advisers” to small business, shouldn’t accountants be implementing a service offering to their clients to conduct due diligence reviews on the client's preparedness for the problems that can be brought upon them by non-compliance with the requirements of the voluntary Personal Property Securities Act and the Personal Property Securities Register?

Preferential Payment claims are a constant reminder of the risks businesses are taking by not registering a customer on the PPSR.

Corporate GovernanceMany clients operate their enterprises through companies. Corporate governance is a vague area and many of your clients could benefit from some mentoring on how best to operate their companies.

Chief Financial Officer ServicesWhat is required in a Virtual Chief Financial Officer Service?

The Chief Financial Officer in a public company does a lot more work than just worrying about income tax.

Regular tasks include:• Review of investment, inventory and debtors.• Analysis of Cashflow Projections.• Preparing “what if” calculations for suggestions and ideas from the Chief Executive Officer and other members of the management team.• International currency monitoring, currency covers.• Working towards the achievement of a Strategic Plan.• Detailed analysis of monthly “management financial accounts” – not the financial accounts designed for presentation to the Australian Taxation Office.

Cost ReviewsCould your clients benefit from a detailed review of the assumptions on costs that they are utilising within their business? Is there an effective job cost system?

Research and Development ManagementIt is amazing how many partnerships, sole traders and trusts incur large sums on research and development only to finally be alerted to the fact that they're unable to claim an income tax rebate on that expenditure because they are not operating as a company. I often wonder – didn’t anyone in the accountant’s team understand what the client was doing spending all that money on research and development. One accountant once told me that the $210,000 expenditure that the client made on research and development from a partnership was treated as “drawings”!

The government is encouraging significant increases in innovation; more and more of your clients will be undertaking research and development activities. Do you have systems to assist them?

Business ValuationsMany of your clients are developing intellectual property without knowing its value. As the government encourages more and more businesses and individuals to undertake innovation, monitoring the valuation of intellectual property within the overall business valuation will become very important for many in the small/medium enterprise community.

Strategic Business ConsultingAccountants can play a “financial directors” role within small/medium enterprises that want to grow…. that have aspirations. Many of them will be prime candidates for the development of three to five year plans. Accountants can play a very important role in being the key strategic business consultant to monitor strategies for the changes that will be necessary in the business to meet the various business goals over the three to five years.

This is all exciting stuff, so what do you need to get going?

What preparation will be needed?• Firstly, it is very important that there is input from the partners. Who wants to be involved in these types of tasks? Some partners will want to stay with taxation and audits. I am not suggesting that the partners should necessarily be doing the business advisory services work. In fact, quite the opposite, I believe the partners’ role is to act as the “rainmaker” and the “mentor” for the managers and the younger accountants and marketing personnel within your organisation who should be the prime delivery team of business advisory services.

• You will need to survey your team and find out who has an interest in offering a wider range of services.

• Probably the most important activity of all in this preparation process, is to have some conversations with your clients as to what services they would like your firm to provide to them, because after all, they will be paying for these services.

My experience tells me that over 75% of your clients will enthusiastically embrace the concept that you're going to gear yourselves to offer a wider range of services. Some accountants baulk at this, but let me pose this to you: I have seen many accountancy firms that are charging a client $5,000 to $6,000 per annum and they tell me in amazement that they have found out that their client saw a business coach and paid the coach $20,000 to $40,000 per annum. Unless the coach is offering exceptional services, accountants, who are prepared to gear up to offer business advisory services, should be able to offer every type of service that the business coach is offering. My question is…. why do accountants baulk at this challenge?

• The team then needs to be trained. Business advisory services will not just occur.

• There will be some professional sales training required because selling business advisory services to your clients is not going to be as easy as selling taxation services because there is no government requirement to do so.

• Plan a series of small seminars with your specially selected clients.

• Invite these clients to a one-on-one meeting.

• Utilise the SMEs Needs' Analysis to assist your client to identify the services they would like you to prepare.

• To be successful in this market, accountancy firms will need to identify “Product Champions” and “Industry Champions”.

• Review the services that you are going to offer to your clients. You don’t have to start off offering twelve services from day one. Pick two or three; prepare them properly and then in six months’ time offer another two or three products, so that over a two year period, you will be able to introduce around twenty products.

• You will need to formulate a marketing strategy so that your clients know that you are now able to deliver a broader range of professional services. It is important that you don’t assume your clients know that you are offering these services.

How do we get ready?• You will need to appoint a facilitator; it could be a partner, a senior manager or a consultant. Someone needs to be responsible for ensuring that, over a three to four month period, a training programme is implemented.

• My suggestion is that you have a weekly team meeting of the people who have indicated that they are willing and able to participate in the extra reading and training required and who have shown a willingness to offer a broader range of services.

• Facilitator’s role – should be able to identify the extra training that is necessary for the various team members. It might be in public speaking, or in the presentation of webinars, or understanding more about a particular industry.

• The group should meet every week for two hours for around three months.

What if we are challenged on our skills for a CFO role?• I think one of the big challenges for accountants is that many of you are nervous about undertaking this new role to help your clients succeed. My suggestion is that, if any of your clients challenge your suitability to be offering a CFO role, you respond in a positive manner.

• Indicate to your clients – "Sure we have traditionally supplied an annual set of accounts and income tax returns but we have been reading the surveys that have been undertaken within the small/medium enterprise market and we know what the surveys are saying".

• "We have also been able to make various changes in our office because of “cloud” technology and the new products and services that are available. More importantly, we clearly understand what the market wants".

• "At university we all studied the same subjects when we undertook our Commerce degrees.

• In our professional year or CPA Entry Training Program, we undertook the same subjects as what our colleagues who are now working for major public companies did – there is no different program".

• "We have invested a lot of time over the last four months in surveys of our team to find out who wants to be involved in the delivery of business advisory services.

• We obtained feedback from some of clients on the services that they want us to provide".

• "We have also trained our team and have accessed tools to assist in the delivery of business advisory services".

• "We are confident that we can deliver an outstanding business advisory service for our clients to assist in building value".

What is required in the virtual CFO services?• You will have to utilise technology to supply an “on call” service.

• The most successful firms will offer a range of products modelled on a public company Chief Financial Officer.

• Your firm will have to be structured so that you can quickly respond to questions “Could we do this differently?”, “What would it cost to do this?”; “What are the alternatives that we have?” These are the types of questions that the Chief Financial Officers’ of public companies receive.

• You will also be required to report on the monthly management financial accounts prepared on an individual unit or activity basis, not an all embracing Profit and Loss Account for a business with a number of different activities that needs to be dissected into the components so that management responsibility can be sheeted home.

• Key Performance Indicators for each of the operating activities that have been reviewed and analysed are very important.

• A “commentary” should be prepared on the business’ financial performance each month.

• Performing the CFO role will require you to identify specific items and ensure that appropriate records are being maintained from day one:- Research and development project costs.- Export market development grant progressive costs.- Budgets and cashflow forecasts that are regularly being updated.- Comparison to budget report.- Benchmarking is very important. How does this business compare to its peers? What can be learnt from the benchmarking process? What changes should management be considering?- Review of board reports.- Preparation of board reports on key financial matters.- Preparation of annual business value for the business, so that the management team understands, not only what the individual businesses are achieving within the business, but what is the effect on the overall business valuation?- Review of Buy/Sell Agreements – are they still appropriate? Is the insurance cover in line with the business valuation?

• Many business owners will have a different view as to what their businesses are worth, or might be worth in a couple of years’ time. This gives the opportunity for an accountant, to firstly prepare the business valuation, identify the valuation gap and then implement a strategy to assist the client and the client’s management team to bridge the valuation gap.

• I indicated earlier that there was over $5B available per annum from Australian, State and Territory governments to assist small/medium enterprises. An accountancy firm that is committed to being a virtual Chief Financial Officer will be extremely proactive in the identification of grants for their clients. Not waiting for the client to come to you and tell you that one of their competitors has received a grant and they would like you to have a look to see whether they might also be entitled to a grant.

• As companies grow, more will need to implement appropriate corporate governance strategies to start boards of advice and properly structured Board of Directors. These entities will require assistance in a number of areas of corporate governance.

• Risk Management is an important issue in public companies and it is also very important in smaller entities.

• Are appropriate insurance reviews being undertaken, a least, annually?

• What changes could be made in debtors’ management to improve debtors’ days outstanding?

• What are the risks that the client is assuming through ignorance of the operations of the Personal Property Securities Act and the associated Personal Property Securities Register?

• How many of your clients are receiving letters from liquidators demanding payments under the Preferential Payments legislation?

• How many of your clients are at risk because they have plant and equipment stored at someone else’s premises or stock located at someone else’s premises?

• Are your clients aware of the strict time lodgement requirements of the Personal Property Securities Register otherwise assets can be forfeited to your client’s customer’s secured creditor!

• An accountancy business, offering a virtual CFO service, should be ensuring that the client’s business is able to very quickly prepare the documents that are required to raise some additional capital or loan funds. Not take months to implement an investment ready status.

• Many SMEs complain that accountants only respond when they ask the accountant a question. If you were the CFO in a public company, you would be expected to be proactive in your advice and contributions. Why aren’t accountants offering the same service to their SME clients?

Are you ready to apply?• I started this discussion with you with a heading “Situation Available” for a virtual Chief Financial Officer Service. Are you ready to apply? There is no doubt that there are a lot of challenges but if it doesn’t challenge you, it doesn’t change you!

The challenges include:- Digital Disruption- Standard Business Reporting- Tax Returns becoming more of a commodity product• Outsourcing – if you have competitors in your market outsourcing significant amounts of their work to overseas countries, at some stage this will become a “competitive weapon” against you in your market place because your competitors will be able to offer services at a cheaper rate.• Outsourcing – will enable accountants to “free up time” to offer new services.

• I fear that many accountants believe they can ignore the challenges that are occurring in the marketplace and hope they go away. Ignoring these challenges is not an option!

Accountants can assistESS BIZTOOLS has developed a comprehensive range of tools to assist accountants to prepare for and deliver a Chief Financial Officer service that incorporates products for each of the items identified in the SME surveys.

You’re invited to sign up for a no-obligation 30-day trial of ESS BIZTOOLS, whereby you will be given the opportunity to test the system. Click here to try ESS BIZTOOLS for free, or visit www.essbiztools.com.au.

ESS BIZGRANTS gives accountants the opportunity to offer a proactive service to identify grants that are suitable for individual SMEs.

You’re invited to sign up for a no-obligation 14-day trial of ESS BIZGRANTS. Click here to sign up, or visit www.essbizgrants.com.au.

Remember the warning from ATSA2014? Jason Bender from Deloitte made a very important presentation in alerting accountants to the challenges that were upon us. He finished his presentation by saying:

“If accountants are not really careful the profession could really suffer”“Don’t let this happen on our watch!”

Peter TowersManaging Director 1800 232 [email protected]

In mid-2015, accountancy businesses are facing a wide range of challenges. Accountants need to develop strategies to respond to the challenges to maintain the accountancy profession’s premier rating as the “trusted adviser” to small/medium enterprises.These challenges include:• Effects of “Digital Disruption” – Deloitte has predicted that professional firms (of which accountants are part) will suffer a 32% change in their businesses, due to the effects of “digital disruption”, if they do nothing over the next few years.• The Australian Taxation Office (ATO) is proceeding with a plan to introduce Standard Business Reporting (SBR) which the ATO believes will result in a “red tape reduction” of, at least, $500M per annum. The vast majority of the “red tape reduction” is expected to relate to accountancy fees. This will encourage small/medium enterprises to ask for their “red tape” discount! There is a strong possibility that the Australian government will promote this “red tape” benefit to small/medium enterprises in the next Federal government election campaign which probably mean that accountants will have enquiries from small/medium enterprises as to whether they have received their “red tape” discount in their fees.• There are continual challenges emerging from competitors based in overseas countries and from business coaches and consultants in Australia.• Outsourcing is creating a competitive pressure for firms which are not outsourcing some of their work.What can accountants do about these very challenging circumstances?Facing These ChallengesOne way that has been suggested by many leading commentators on the accountancy industry, is for accountants to adopt a far wider commercial presence by offering clients “business advisory services”.Business advisory services include a range of products not connected with income tax returns, including:• Debtors’ Management• Cashflow Management• Succession Planning• Business Planning• Personal Property Securities Register Due Diligence System• Advice on Selling a Business• Advice on Buying a Business• Getting Ready to Raise CapitalThese are just some of the items for which accountants could consider developing skills so that expanded services could be offered to small/medium enterprises.Surveys ConductedIt’s interesting to note that a number of major surveys, conducted by CCH, MYOB and other organisations, have identified that small/medium enterprises want to be supplied with a wider range of services.The CCH survey , conducted a couple of years ago, identified these key issues specified by small/medium enterprises:• management of costs• management monitoring• business plans• assistance in raising capital or loan fundsThe MYOB survey asked the question: “What type of advice would you like to receive from your accountant?” The survey responses identified:• future planning• business analysis and interpretation• raising finance• succession or exit planningAccountants Can AssistESS BIZTOOLS has developed a range of products to assist accountants to offer business advisory services to small/medium enterprises to help build value for their businesses. These services will contribute to accountants retaining the “trusted advisers” status.You’re invited to sign up for a no-obligation 30-day trial of ESS BIZTOOLS, whereby you will be given the opportunity to test the system. Click here to try ESS BIZTOOLS for free, or visit www.essbiztools.com.au.As a preview of what’s contained within ESS BIZTOOLS, a complimentary copy of “Opportunities From Digital Disruption” is attached with this transcript.

Are you famous for adding value?

Virtually every accountancy business in Australia does tax returns. Some firms claim to be “famous” for tax but how do you differentiate yourself in a crowded market place?

The beginning of a new financial year is an appropriate time for an accountancy business to stop, reflect and take stock on where your accountancy practice is headed over the next few years.

We are living in a situation where there is undoubtedly digital disruption going on in the community, affecting accountancy firms and a wide range of other businesses.

Another particular concern to accountants is the Standard Business Reporting system that is currently being phased in by the Australian Taxation Office (ATO). The ATO is very confident that this is going to cause at least a $500M per annum reduction in professional accounting fees. How much of this is likely to affect your firm?

Taxation returns are becoming more of a commodity product and there is the ongoing increase in overseas competition. One way to become “famous” and to insulate yourself from some of the changes that are occurring in the marketplace is to offer a broader range of commercial services, commonly known as “business advisory services”.

Let’s take a few moments and look at what some of these services are:

Indeed, the Second Commissioner of Taxation at the ATSA conference last year publicly recommended that accountants should become the cashflow management consultants for small/medium enterprises as one way of offsetting the $500M per annum income reduction.

Being a virtual Chief Financial Officer (CFO) for your small/medium enterprise clients.

At one stage in my career, I was a CFO of a listed public company. The thing that quite intrigued me when I first became involved in that position is that a public company basically divides itself into a whole series of small businesses and then appoints a Regional Manager to control those businesses.

The benefit that a public company’s CFO has is that he/she has a whole team of in-house experts to help them.

I submit to you that your small/medium enterprise clients basically have the same problems and. In fact, your small/medium enterprise clients could have more problems than what the CFO of a public company has and they haven’t got the benefit of the in-house people to assist them.

In the financial side of those services, I seriously suggest that accountancy businesses should be very keen to supply that type of service to their small/medium enterprise clients.

This was identified in the CCH Small Business Survey[1], completed several years ago, as the biggest problem confronting small business operators. Are you offering cost management advice to your clients?

This is one of the real sleeping issues confronting every business in Australia. The only time you really know about it is if one of your clients unfortunately gets involved in a transaction with a business that has an insolvency event and then your client could be wiped out, basically because they didn’t spend $7.50 to register a transaction on the Personal Property Securities Register.

According to my research with our subscribers utilising our Personal Property Securities Register System less than 5% of small/medium enterprises have a clear understanding of how this legislations operates.

The Australian Federal, State and Territory governments allocate nearly $5B a year for grants, incentives and special loans for businesses. Are you clients receiving their fair share of these grants, because after all they are all paying for them through their taxation?

Many of your clients are looking to grow their businesses and they are concerned about things like corporate governance, how to go about appointing an external person to their Board of Directors or their Board of Advice. What type of growth should they try to achieve over the next three to five years?

Getting prepared to raise capital is also a very important issue as more and more businesses are looking to grow beyond the $2M barrier and to grow into businesses of $5M to $20M turnover. Many of those businesses will be very interested in trying to get themselves prepared to be able to raise one or two million dollars from Business Angel Investors.

These are the challenges that confront accountants in 2015/16.

One way to clearly differentiate your services is to offer these types of products to your clients. Then you could become “famous” for adding value to your clients and this is what the SME market wants.

Subscribers to ESS BIZTOOLS receive material, papers, templates and articles on all of the subjects that I have discussed in this comment as part of their subscription to ESS BIZTOOLS. If you would like to receive further information on the services provided, please send me an email [email protected] or visit our website at www.essbiztools.com.au.

You can start a 30-day free trial of ESS BIZTOOLS. Click here to sign up.

A complimentary copy of the paper on the processes of offering Chief Financial Officer services for client is attached with this transcript.

To receive future editions in the ‘Business Advisory News for Accountants’ series, I invite you to subscribe, FREE of charge, to our ESS BIZTOOLS – Business Advisory News for Accountants – Podcasts page on iTunes.

If you have any questions or, if you have suggestions on future items to be covered in Business Advisory News for Accountants, wherein we will look at ways and means that accountants can be more effective by offering a range of business advisory services to their clients, please do not hesitate to email me at [email protected].

Have a wonderful celebration of the start of a new financial year and may 2015/2016 be an outstanding year for you in offering value adding services to your clients.

Peter Towers

Managing Director

1800 232 088

[email protected]

[1]SMEs - the fine line between failure and success, CCH, April 2013

In the last few months, the Federal government has released two new grant programs, which offer significant benefits, not only to employees, but also to the businesses themselves.

These grants are Industry Skills Fund and Training for Employment Scholarship.

Accountants, who are acting as trusted advisers and offering a range of business activities, are able to alert their small/medium enterprise clients to these types of grants. In some instances, they will be able to actually perform some of the work relating to the grant funding.

The Industry Skills Fund has different levels of benefit available, depending on the number of full-time equivalent (FTE) employees that are engaged by the business. These range from:

· Micro-businesses (0-4 FTE employees) – 75%

· Small businesses (5-19 FTE employees) – 66%

· Medium businesses (20-199 FTE employees) – 50%

· Large businesses (200+ FTE employees) – 25%

The business’ contribution must be in cash.

The purpose is to assist businesses to access training so that the businesses are better placed to succeed in a rapidly-changing economy.

The skills development fund has identified “priority industries” which include:

· Food and Agribusiness

· Mining Equipment Technology and Services

· Medical Technologies and Pharmaceuticals

· Oil, Gas and Energy Resources

· Advanced Manufacturing

· Enabling technology and service industries that support one or more of the priority industries listed, including:

- Freight and Logistics

- Infrastructure Related Construction

- Information and Communication Technology

- Professional Services

The government believes that these priority sectors are the industries where Australia enjoys a competitive advantage and is likely to have an opportunity to exploit favourable global market conditions or has a significant impact on the Australian economy.

Applicants who are within the “priority industries” will then be fast-tracked through a streamlined assessment process. However, applicants that don’t fall within the “priority industries” are still able to apply and, indeed, your clients, who have a worthwhile skills development program, should apply.

In the application, the applicants will need to clearly show that they have significant growth potential and are preparing to re-position themselves to take advantage of economic opportunities.

This program presents some tremendous opportunities for businesses to undertake some worthwhile skills development, with the government paying a significant amount of the cost.

As the business’ accountant, you can possibly participate in some of these training activities, such as upgrading the understanding of the financial data, including KPIs, benchmarks and how all of these link together within the financial reporting process. This could be an activity delivered to middle-level management by an accountancy firm.

The government has also released a pilot program, Training for Employment Scholarship, to run until 31st March 2016. This program is targeted at businesses employing less than 200 FTE employees and is located in specified outer metropolitan and regional areas as follows:

· New South Wales:

- Central Coast

- Hunter Valley (excluding Newcastle)

- Sydney-Outer Western/Blue Mountains

· Queensland:

- Sunshine Coast

- Ipswich

- Townsville

· Victoria:

- Mornington Peninsula

- Melbourne-West

· South Australia:

- Adelaide-North

· Western Australia:

- Perth-Southwest

· Tasmania:

- Launceston-Northeast

The objective of this program is to provide businesses with greater access to appropriately skilled workers in their region and improve job prospects for young people, by providing incentives for employers to take on new workers.

Participants in the training must meet the following criteria:

· age 18-24 years from the date of employment;

· an Australian citizen, permanent resident or have working rights in Australia;

· employed by the business;

· agrees to undertake the training specified in the funding application; and

· hasn’t been in full-time employment or full-time study prior to commencing employment with the business.

The training must be delivered over a 26-week period.

The grant will reimburse businesses training costs of up to $7,500 (including GST) per eligible employee.

An accountancy business, which has accepted a wider range of responsibilities as a trusted adviser to small/medium enterprises, can be a valuable resource for small/medium enterprises, by keeping the small/medium enterprise operators aware of government grants.

In particular, these two grants are of great significance for smaller enterprises.

Subscribers to ESS BIZTOOLS and ESS BIZGRANTS receive articles, training material and other assistance to help their clients understand grants and other aspects of business operations other than just taxation.

You can start a 30-day free trial of ESS BIZTOOLS. Click here to sign up.

A 14-day trial of ESS BIZGRANTS is available. Click here to sign up.

To receive future editions in the ‘Business Advisory News for Accountants’ series, I invite you to subscribe, FREE of charge, to our ESS BIZTOOLS – Business Advisory News for Accountants – Podcasts page on iTunes.

We will be presenting a special webinar program, including the following key note speakers:

· June 2015 – Damian Arena of IODM on Improved Debtors’ Management

· July 2015 – Trevor Marchant of Marchant Dallas on Professional Selling for Accountants

· August 2015 – Paul Barnaby of Plan Guru on Budgets and Cashflows

If you have any questions or, if you have suggestions on future items to be covered in Business Advisory News for Accountants, wherein we will look at ways and means that accountants can be more effective by offering a range of business advisory services to their clients, please do not hesitate to email me at [email protected].

Peter Towers

Managing Director

1800 232 088

[email protected]

One of the problems with many small/medium enterprise operators is that they try to do too much, primarily because they haven’t introduced effective delegation within the organisation.

One way to introduce effective delegation is to allocate portfolios relative to that particular business.

It’s a good exercise to sit down and write down all the functions that relate to the organisation and to think about how that role should be performed. Even if it’s only for few minutes each day or 10 minutes a week, it all contributes to the effective management of the business.

If all the responsibilities for these tasks are left for one person, it’s no wonder that many small/medium enterprise operators get “bogged down”.

Read more on our blog

This was the direct appeal made to attendees at the ATSA (Australian Technology Showcase for Accountants) conference in Melbourne, on 21st October 2014, by Deloitte partner Jason Bender.

Mr Bender had earlier said that accountants need to think about how they’re going to react to the changes that are occurring in the marketplace and to the accountancy profession. He said that, “If accountants are not really careful, the profession could really suffer.” Sobering words to take into consideration.

There are many on the horizon.

Read the blog:

You can start a 30-day free trial of ESS BIZTOOLS. Click here to sign up.

As a preview of what is included in ESS BIZTOOLS, a complimentary copy of our ‘Debtors’ Management System – Introduction Checklist’ can be downloaded below.

To receive future editions in the ‘Business Advisory News for Accountants’ series, I invite you to subscribe, FREE of charge, to our ESS BIZTOOLS – Business Advisory News for Accountants – Podcasts page on iTunes.

Accountants need to be aware of the ‘priority industries’, which are the main recipients of grants under the four major grant programs introduced by the Abbott government.

Priority industries are industries that the government believes enjoy a competitive advantage and are likely to exploit favourable market conditions or have a significant impact on the Australian economy.

Business plans are like ‘maps for tourists’. If you don’t know where you’re planning to go, how are you going to know when you get there?

Virtually every business, large or small, requires a business plan, including sporting organisations, charities and churches.

Within the small/medium enterprise, the CEO, directors (if any) and the management team should be utilising a business plan to help them direct the business towards achieving its overall objectives. Other people are also interested in business plans, as a means of determining whether they’re prepared to be involved in the business in some way.

The Entrepreneurs’ Infrastructure Program has been developed by the Federal government to drive business growth and competitiveness through support for business improvement and promoting economic growth through research, connections and commercialisation of novel products, processes and services.

Last week, the government released its final grant program within Entrepreneurs’ Infrastructure Program, Accelerating Commercialisation.

Accelerating Commercialisation contributes to Entrepreneurs’ Infrastructure Program’s objectives by:

· Accelerating the commercialisation of novel intellectual property in the form of novel products, processes and services.

· Creating new businesses based on novel intellectual property with high growth potential and facilitating greater commercial and economic returns both from public and private research.

· Develop investment to drive business growth and competitiveness.

A clear warning was issued by two prominent speakers at the Australian Technology Showcase for Accountants (ATSA) Conference in Melbourne, held on 20-21 October 2014. They indicated that ‘digital disruption’ is starting to affect accountants.

Two years ago, Deloitte produced a report, ‘Digital disruption – short-fuse, big bang?’ This report predicted that professional services, of which the accountancy profession is a key component, would encounter 33% of revenues becoming ‘disrupted’ over time.