Accountants are naturally cautious about involving third party advisers. They don’t want to be forced to bill their clients more than last year. They also don’t want to bear the cost of seeking a second opinion.

This atitude means that some accountants muddle along and avoid admitting to clients that they have limited experience in certain areas. They allow and even encourage clients to assume that their accountant can advise on all areas of finance, business and tax. In taking this approach the accountant may take the risk of advising on specialist matters outside of their day-to-day experience.

Other accountants simply avoid advising on such issues even if they suspect that these could be to their clients’ benefit. And, despite the risk of negligence claims and of being reported to their professional body, this approach appears to pay off.

Few clients are aware of the ‘better’ advice they could be receiving. Few clients will know that their accountant’s advice is untested and based on out of date knowledge. And even fewer will be aware that their accountant actually has no first hand experience of dealing with similar problems or issues for other clients.

Why do so many accountants feel that it is a sign of weakness or incompetence to admit that they require specialist help? By way of analogy no one expects their local GP to be an expert in all areas of medicine and health. Indeed we would be pretty worried if a GP suggested we hop up on the bed so that they can open us up and have a look inside to see what’s troubling us. We expect to be referred to specialists and to different specialists for different ailments.

The best accountants operate on a similar basis. They ensure that their clients know the limits of their expertise. They have built up trust so that their clients are happy to talk to a specialist when necessary. And they have made clear to their clients that extra work and extra advice means additional fees.

What’s your approach?

I will continue this theme in my next blog post. In the meantime, if you want to get in touch with specialist tax advisers who can help you when issues arise outside of your day to day experience – simply go to the Tax Advice Network.

The above comments are taken from my contribution to a report, ‘GRF is killing the profession‘,  recently published by Bob Harper. He says it contains contributions from “leading thinkers, advisers and consultants to the accounting profession.”  (Ron Baker, Bob Harper, Dennis Howlett, Mark Lee, Mark Lloydbottom, Michael McKerlie, Finola McManus, Steve Pipe and Paul Shrimpling)

I attended a business focused Question Time networking function earlier this week. One of the questions posed was whether all SMEs should embrace social media.  I expected the marketing guru on the panel to be an ardent supporter of the idea.

In the event I was pleasantly surprised that he gave the same answer as I would have done. And it echoes the views I have shared on this blog before.

If you think your target clients and prospects are active on social media then by all means look to join up and engage with them. But it’s not right or necessary for everyone.

For example, if you are targetting start up businesses you will find plenty of them are active on twitter. Many of those accountants pointing to the success of their twitter activity are themselves relatively new into practice and can relate well to start-up businesses.  I also suspect that accountants and lawyers who offer tax or advisory services to consumers will have more success faster than those who who want to be engaged by established businesses.

The starting point, if you are considering getting involved with social media, is to be clear about your objectives. And over what time scale will you judge your success or otherwise in achieving those objectives?  Oh, and is the investment of time (and money if you employ or engage someone else to do it for you) worth while? Remember you should also compare this investment with the alternative uses of your time and money.

There are SOME good arguments for getting engaged in social media. But it’s not for everyone. The main misconception is that it’s a low cost way to market and promote your practice. Plenty of professional advisers make this mistake and try to use social media to broadcast their marketing messages. However, those that try this quickly give up – disillusioned with the medium, when it’s actually their messages that were failing.

To make social media work for you you have to be ‘social’ rather than anti-social. It’s not a broadcast medium. If all you plan to do is active marketing then don’t waste your time.

(I’m running a half day masterclass on 21 July to debunk social media and to help professional advisers get it right. Full details here)

As I’ve explained on the twitter page of this site I don’t think twitter is for everyone, but it works for me. This new weekly blog post is for the majority of profesional advisers who are not using twitter.

I’ve copied below some of the tweets I have shared (ReTweeted) this week that you may find useful. In each case I read the blog posts and articles that are the subject of the original tweet. A couple link to postings of mine elsewhere on the web.

Whenever I ReTweet something I’m sharing the links with a wider audience who I hope will find them useful. My contribution to the tweets in question is the comment at the end after //

RT @NewModelAdviser: DS: Tax avoidance or tax evasion. Are you sure you know the difference? http://tiny.cc/xu0w0

RT @N3W_Media: One app every Sales Prof’l will want on their #iPhone http://ow.ly/5diNj Manage your pipeline where ever you are// It’s fab!

RT @vatconsultancy Great advice from @BookMarkLee Why now is the time to review your VAT liability – Citywire http://bit.ly/ktQu2a // Thanks

RT @cheapaccounting: Have you been asked by your boss to go self employed? http://t.co/BFP67fC // Well explained Elaine. This is very good.

RT @TheTaxBuzz: Do ‘economists’ really think increasing tax rates is ‘the’ answer? http://bit.ly/mEo6ZK // Re letter from 52 ‘economists’

RT @cheapaccounting: Accountants can you please tell me – Just how do you get the E in QBE? http://t.co/AYUmBUK // GREAT blog again Elaine.

RT @natashagram: Creating a Marketing Message For Your Accounting Firm http://bit.ly/jHSUIn // Worthy of WIDE circulation. GREAT advice

Although I’m an enthusiastic tweeter I accept that twitter is not for everyone. I’ve shared my views more widely here.

This blog post is for the majority of professional advisers who are not using twitter. I’ve noted below a selection of the tweets I have posted this week as they are intended to be helpful – in line with the ethos of this blog. I’ve added a word or two of explanation where appropriate.

Will be recommending @NikkiPilkington and her 7 Deadly Sins of SEO in a forthcoming talk on Websites for accountants (The objective view)

I was speaking at Mercia partners’ conference on ‘Making your firm’s website work for you – the objective view’. Rather than reinvent the wheel I included Nikki’s notes – with due credit. Like me she offers an independent perspective.

“The problem with quotes on the internet is you can never be sure of the original source” – Mark Twain

A satirical comment!

Good advice and tips re using LinkedIn from @RobWilmot at Mercia conf. Connect rather than Collect. Personalise the stnd invite to connect

Rob was another of the speakers at the Mercia conference and he encouraged everyone to personalise the standard invitation that LinkedIn offers as a starting point when you ask to connect with someone you know. He also rightly stressed that LinkedIn is about Connecting with people – not simply collecting a load of ‘connections’.

David Oliver of Insight Marketing has just shared some ASTONISHING new tips on referral marketing for accountants – At #Mercia conf

Like many of us in the profession I thought I’d heard it all before. But David Oliver impressed me with a range of new, innovative and, most importantly, COMMERCIAL ideas for securing valuable referrals.

During Q&A at end of #Mercia conf I was pleased to take the opp’ty to recommend #4networking and #NRGNetworks.

This followed reference to BNI as if it were the only available business networking group. I tend to encourage accountants to explore 4networking and NRG which are both very different from BNI and from each other. Horses for courses.

I’ve been asked why I have a number of different blogs and websites. It’s not something I would encourage many people to do so perhaps it’s worth explaining my thinking. I accept it could be flawed, but bear with me.

Firstly let me stress that in all of my writings for professional advisers (eg: on AccountingWeb, AccountancyAge, New Model Adviser and this blog) I focus on encouraging best practice. I typically share what I have researched and can see or believe will be commercially viable advice for working professional advisers. I do the same in my talks. I offer an objective and independent view. I have no agenda re practice management or consultancy services. In this context I think, I write and I speak. That’s it.

I frequently stress that what works for me is not automatically going to be right for accountants in practice for example. The most obvious case in point concerns the way I use twitter.

Enough background. Here’s my thinking about my websites and blogs.

There are two key points to keep in mind:

• The first is that I want the visitors to each site or blog to know they are in the right place;
• The second is that I want to have clear analytics that reveal the relative interest from different types of audience.

My personal website www.BookMarkLee.co.uk started life as a consultancy business but it’s now simply a home for my profile and to promote my availability and expertise as a speaker. Also on this site is my blog. This blog.

More people are interested in my blog posts than in my availability as a speaker so I frequently link to the blog directly rather than expect people to find it via my home page.

I have a sense of humour and have long collected humorous stuff related to accountancy and tax. I maintain a separate blog (now called www.Accountant-jokes.com) on which I post all such items – it now has over 500. Much of the traffic for this fun blog comes from overseas. And the audience reaches far beyond the worlds of accountancy and tax. Many people are looking for the sort of material featured on the blog to include in speeches and talks. Keeping the fun blog separate means I don’t fall into the trap of thinking that anything else I do has a big overseas audience – unless and until it really does!  It also means that I don’t risk alienating those members of our profession who might not share my interest in the humorous side of things.

The Tax Advice Network has a wholly different focus again. That website has a home page for people seeking specialist tax advice. Those people are neither interested in Mark Lee, my blog posts nor my joke collection. It’s a sophisticated business website and has to be separate from my personal sites.  I also have specific landing pages on the website for Accountants, for Tax Advisers, for IFAs and, shortly, for solicitors too.

As a plug for the Tax Advice Network and to encourage relevant writing and speaking engagements I write the Tax-Buzz blog. This matches the Tax Advice Network branding but is hosted separately on Google’s blogger platform. This makes it more Googlicious than if it were integrated into the website.

Each of the blogs contains links to the others and to the websites.

So that’s what I do and why. To summarise:

• Where the fundamental offering is the same (ie Tax Advice Network) but I have different audiences I have separate landing pages for each audience.
• Where the subject matter of what the target audience is seeking is very different I have separate blogs and a personal website.

It makes sense to me. The only change I could realistically make would be to bring the accountant-jokes blog inside the BookMarkLee website/blog – whilst keeping the domain name and pointing it at the relevant section. I’d have to believe it would be worthwhile. At the moment I don’t.

Feel free to share your views below as to whether this makes sense to you or if you have some constructive suggestions/ideas.

The Accountancy Age awards are dead, long live The British Accountancy Awards (an Accountancy Age event).

I’ve enjoyed the Accountancy Age Awards ceremonies over the years. I remember the time back in the Natural History Museum when the then editor announced the launch of an AccountancyAge website. He seemed to think we would all be logging on throughout the day to find out about the latest news and views. I was doubtful that would happen then and remain doubtful now. We all log on when the mood takes us – generally in response to an email prompt or when looking something up online. Must admit I’m sad the printed version is no more, but life moves on.

In recent years the Awards have been held in the big convention marquee in Battersea. But there will be no more such Awards. Unlike the newspaper though they have not disappeared entirely. They are being reborn as The British Accountancy Awards and I would encourage you to consider entering. These awards will be quite different to those of the old ceremonies as there a loads of new categories for regional independent firms.

I was one of the judges of the Taxation awards for a number of years. I was always surprised by the number of entries which did not comply with the entry guidelines. If you’re inclined to enter the British Accountancy Awards – do make sure you read the guidance and ensure your entry satisfies all of the criteria.

Do not underestimate the potential value to your practice if you win one of the awards. Indeed, getting short-listed is also something to celebrate. Both are newsworthy – in your local area at least.  Good luck!

The traditional focus on recurring work and the associated recurring fees is likely to change in the near future.

There are an increasing number of alternative, low cost and professional alternative service providers. Those clients who perceive that all their accountants do is produce accounts and tax returns will be at risk. At the moment there is just a trickle of a move to online, cloud solutions and DIY compliance. This trickle will increase starting at the lower end but across the board as everyone looks to get more value (for which read ‘advice’) from their accountant.

Accountants who provide traditional tax return completion services and simple accounts preparation services are most at risk. Plenty of commentators have been saying this for a few years. I’ve long been of the view that the move to newer style service providers will not happen overnight. But it will happen.

Accountants who are losing more than a trickle of clients would be well advised to check out what the competition is promising and doing to win work away from them.  Then comes the hard question. How will you respond?

How many accountants go into practice with the intention of operating in the same way as lawyers do?

Not many I think.

What do I mean?

Well lawyers are very much transaction focused. Property lawyers advise and help facilitate property transactions. Family lawyers advise on divorce, child custody and other one-off situations. Commercial lawyers advise on business deals – and so on. When the deal is done, when the situation is resolved, the work ends. And the lawyer moves on to a new piece of work. In most cases, other than perhaps in the largest firms, each lawyer has to constantly devote time to finding new work.

Accountants are different. Due to the obligation imposed on clients to produce annual accounts and to file tax returns every year, accountants have lots of recurring work. Clients come back year after year. In fact the clients don’t go away. They often pay annual fees by monthly instalments. Accountants can anticipate that the total annual fees they earn will remain pretty constant year on year. They may lose a few clients for whatever reason but equally they will probably pick up a few new clients and it will all balance out.

The question that is rarely asked is whether accountants or lawyers are more profitable? Another related question would be whether accountants or lawyers feel more fulfilled in terms of the work they do and the extent to which they apply their training, knowledge and expertise?

The above comments are taken from my contribution to a report, ‘GRF is killing the profession‘,  recently published by Bob Harper. He says it contains contributions from “leading thinkers, advisers and consultants to the accounting profession.”  (Ron Baker, Bob Harper, Dennis Howlett, Mark Lee, Mark Lloydbottom, Michael McKerlie, Finola McManus, Steve Pipe and Paul Shrimpling).

Seth Godin is renowned for his pithy and thought provoking blog posts and books.  His most recent post is a new (to me) way of looking at the age-old ‘time vs value based’ billing argument:

“Long work is what the lawyer who bills 14 hours a day filling in forms does.

Hard work is what the insightful litigator does when she synthesizes four disparate ideas and comes up with an argument that wins the case–in less than five minutes.

Long work has a storied history. Farmers, hunters, factory workers… Always there was long work required to succeed. For generations, there was a huge benefit that came to those with the stamina and fortitude to do long work.

Hard work is frightening. We shy away from hard work because inherent in hard work is risk. Hard work is hard because you might fail. You can’t fail at long work, you merely show up. You fail at hard work when you don’t make an emotional connection, or when you don’t solve the problem or when you hesitate.

I think it’s worth noting that long work often sets the stage for hard work. If you show up enough and practice enough and learn enough, it’s more likely you will find yourself in a position to do hard work.

It seems, though that no matter how much long work you do, you won’t produce the benefits of hard work unless you are willing to leap.”

You may not record 14 hour billable days. But if you focus on how much billable time you can record on your timesheet each day you are of the same mindset.

I would suggest that Hard work, in this context, is the application of knowledge, skills and experience to solve problems and to provide valuable advice – without the need for detailed research or long advisory letters. I would stress though that it should be genuine and not guess-work or risky half baked ideas that would have benefitted from proper research.

Hard work requires discussion over the value to the client. It also means the adviser has to decide whether the agreed fee will provide sufficient reward. Sufficient to cover not just the time but also to contribute to the build up of knowledge skills and experience which put the adviser in a position to provide the advice. Thinking that all through, having the discussions and accepting the outcome is Hard work.  But it can pay very well as a result.

Do you focus on Long work or do you have a way to get paid a fair fee for doing the Hard work?

This draft agenda re a first meeting with a prospective client dates back to 2006. It’s an example of the approach I adopted when I was in practice.

I had created a number of  template agendas – I chose the most appropriate one and personalised it for each meeting. This always impressed prospects as it showed I had thought about their situation beforehand – by ref to our initial telephone conversation.

The other benefit of this template was that it contained reminders of issues I needed to cover. Better that than to have them scribbled on a pad. Notice that there is no specific point for me to talk about my practice – other than at point 5. There is little point in starting such meetings with a summary of you and your firm’s background. Instead, after the briefest of intros (especially if you have a colleague or staff member with you) encourage the prospect to talk about what’s on their mind – as prompted perhaps by some of the agenda items – it’s not set in stone, just may be helpful. The items listed may also help the prospect realise that there are more issues to consider than perhaps they had previously considered.

What else might you want to add on to such an agenda?  Looking back I think there’s something pretty obvious missing.

AGENDA

1. Introductions

2. Issues and concerns

a. Extraction of cash b. Maximising entitlement to Business Asset Taper Relief [Entrepreneur's Relief now of course] c. Potential sale in next couple of years d. Inheritance tax (business property relief)

3. Company background

a. Activities b. Annual accounting date c. Last filed accounts d. Premises and locations e. Accounts and Directors Reports

4. Attitude to risk taking

a. Tax avoidance schemes b. HMRC (Revenue) enquiries – any history? c. Investments

5. How can we help?

6. The way forwards

a. Advice required to provide peace of mind b. Terms of business and payment on account c. ‘Know your client’ paperwork

Related posts:

• Good agendas for client meetings
• Good agendas for meetings