How the changing accounting industry should be changing your expectations
These are exciting times! The accounting industry is being revolutionised on a number of fronts. It has been claimed that the accounting profession is the job at most risk of automation. Late 2014 there was a report released by the Australian Department of Industry which again highlighted the threat facing the accounting profession. Compounding this is the announcement by the ATO to cut $500 million in account fees through streamlining its processes. In layman terms the day will likely come where the ATO will be able to access your data directly from your XERO, MYOB Live, Intuit, SaaS or other cloud based program, reducing the dependence on your tax agent.
Add to this the fact that countless firms are now offshoring your compliance (tax) work to the likes of India and Vietnam, then clearly a business typical stock standard compliance work is very much a commodity.
To me this is fantastic news for business owners. Being a commodity means that there will be fee pressure, which ultimately results in having ‘tax’ done will likely cost the consumer less tomorrow than it does today. And let’s be honest, who likes to pay top dollar simply to have a tax return and a bound set of financial statements provided when today's environment makes this a commodity with limited value? Don’t get me wrong, there is certainly value in engaging high level tax advice when particular circumstances arise and your trusted advisor will need to recognise this to act appropriately.
While tax minimisation is very important, legislation can limit these opportunities for many SMEs in comparison to years gone by. Would your business not be better off being in a position where cash-flow allocated for compliance preparation could be utilised to access to relevant information that is current and accessible in your own system? Or to be discussing and focusing on future strategies of the business and its goals?
By no means does this mean that the small business owner will not need the professional services of an accountant and trusted advisor. But it does mean that they should not be paying 'value based' fees for work that is not providing value. Work that is purely ticking the box as far as your tax compliance requirements go. There will be occasions that you will need to engage in very high level tax advice when particular circumstances arise and your trusted advisor will need to recognise this to act appropriately. It may be that they have the appropriate experience in the applicable field, or alternatively they are surrounded by a network that can assist if and when needed.
Technology alone presents another set or opportunity for a businesses. It’s no longer acceptable to receive your complete financial position three or six months after the end of the financial year if this is your only true gauge of business performance. Having access to relevant and reliable information can be the difference between an informed and educated business decision and a catastrophic one. Doesn't every decision maker want up-to-the minute information and guidance from the people they surround themselves by?
An article published by Accountants Daily recently stated “the best accountants have an intimate knowledge of their client’s business and are always searching for future opportunities for them”. This statement resonates with me as I completely agree. Fantastic and game changing outcomes can be achieved under this approach.
If as a small business owner, or potential small business owner you find yourself nodding in agreeance to this then don’t think twice about giving SALO Strategic a call
By Felicity Cheeseman @ SALO. Strategic