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Accounting Advisory Services: The 2021 Guide

FEBRUARY 22, 2021 | IN PRACTICE MANAGEMENT | BY RYAN LAZANIS

This is my complete guide for accounting advisory services in 2021.

In this guide, I’ll review:

What accounting advisory services are

Why your rm should offer them
The top advisory services to offer in 2021

So if you’re looking to offer advisory services in 2021, you’ll want to check out this guide.
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Let’s get started!
Disclosure: This post was sponsored by Xero. Everything discussed is my honest opinion based on
personal experience. ABOUT WORK WITH ME NEWSLETTER BLOG CONTACT    

What are Accounting Advisory Services?

Every accountant seems to have a different de nition of what “advisory services” consist of.

To keep things simple, I’ll de ne them as any service that provides advice to your clients.

With compliance services, you are preparing the books and ling any statutory lings with the
appropriate authorities. But if you then analyze the numbers, discuss them with your client, help them
look forward and/or help them better plan their affairs, this then shifts into the sphere of advisory work.

As such, advisory services can consist of simple discussions with your clients all the way to full-blown
nancial modeling (and everything in between).

Why Should You Offer Accounting Advisory Services?

The biggest reason to offer them is because there’s a need.

And if there’s a need, then demand exists.

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Demand equals revenues for your rm and a stickier client relationship.
I know there’s a need because:
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First, based on my own personal experience running an online accounting rm, 9/10 small business
owners I worked with were pretty clueless when it came to using their own nancial data to drive
decision making. It was clear they didn’t know how to come to decisions around protecting their assets,
minimizing their risk or using the data to drive growth.

Second, the data supports my personal experience.

Xero commissioned an independent study of 800 small business owners in Canada and found that a
large swath of business owners, namely Millennials and Gen Z received failing or poor grades on basic
questions that tested for nancial literacy:

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And from the very same report, the top business goals amongst Millennials were:
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With the survey reports indicating low grades in nancial literacy, without outside help, achieving these
goals will be di cult.
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This then presents a large opportunity for accounting rms.

Add to this the fact that another recent Xero study polled 250 accounting and bookkeeping rms and
found that those that offer advisory services generateWORK
ABOUT around 65%
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per client than BLOG
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compliance-focused rms:

To summarize why your rm should offer accounting advisory services:

1. Clients aren’t able to perform this kind of work themselves since they don’t have the capabilities
2. The top goals in 2021 for a large chunk of businesses
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3. Your rm can add a signi cant amount of money to your top line

The Top Advisory Accounting Services in 2021

Below you’ll nd a few advisory services that I think make a ton of sense given the current economic
climate which also support the facts found in Xero’s report on nancial literacy.

1) Include Health Check-Up Calls with Every Client

It amazes me how many clients only hear from their accountant once a year after their year-end has
passed.

Today’s generation of business owners want constant feedback. They’re hyper-connected people. And
getting info, tips and advice once a year from their accountant is not su cient.

In fact, another Xero report that polled 1,500 business owners found that one-third of millennial
business owners didn’t hear from their accountant more than twice a year:

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A simple x?
Include scheduled check-up calls with your clients in every one of your plans.
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I like this kind of service because it’s super simple and it allows you to check-in with your clients at
regular times during the year to help you and your client stay ahead of the ball.

There’s nothing fancy required to the service:

1. Offer semi-annual, quarterly, monthly, bi-weekly or weekly health check-up calls. In a three-tiered
pricing model, your Gold service tier might include weekly calls whereas your Bronze service tier may
include semi-annual or quarterly.
2. Review the nancials before the call and come to the call with a few talking points.
3. Chat with your client about what’s new with their business and review your talking points.

That’s it.

This is an easy, valuable advisory service that gives your client insight into the numbers and to bounce
ideas off of you and it arms you with information to maintain a closer, stickier relationship with your
client.

2) Make Your Cash Flow Forecasting and Budgeting Repeatable

When many think about advisory services, they think that they’re not scalable. 

But that’s not true.

If you productize the services properly, they can be extremely scalable.
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And my favorite services to scale are cash ow forecasting and budgeting services if you can make
them repeatable.

Clients love them and they can be incredibly easy to offer.

Not only that but the 2 top business goals listed by millennials in Xero’s report t squarely into the
de nition of budgeting and cash ow forecasting:

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Here’s how you can turn cash ow forecasting and budgeting into something repeatable where you can
charge a monthly price:

First, charge a once-off price to develop a 12-month forecast/budget (or whatever time horizon you
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prefer). There is some work required to get the model in place depending on the level of detail you
decide to go into.
Then, you would include monthly/quarterly/semi-annual/annual maintenance of the budget or cash
ow forecast. You would have a meeting every
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update the budget or forecast to take into account changes occurring in the business.

If you’re updating a budget, you could also perform a budget vs. actual analysis as part of the service:

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So upfront, yes, there is a bit of work to get the model in place, but after that, updating and maintaining
the model periodically is super simple (but ABOUT
still very valuable to the
WORK WITH ME client).
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3) Coach Your Clients

I’ve learned a thing or two about coaching over the past few years as I transitioned from rm owner to
accounting rm coach.

One of the top things I learned is to speci cally understand “the gap” and then to help these business
owners close “the gap.”

What is “the gap?”

It’s simply understanding where someone is now and where someone wants to end up, speci cally.

For instance, if you have a client that wants to hit $5M in revenue and sell their company in 5 years, and
right now they’re only at $1M, we now have a clear understanding of the gap.

Then it’s up to you and your client to devise a plan to get there.

And along the way, you will help guide your client, keep them on track, challenge them, hold them
accountable and act as a sounding board.
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To me, this is the pinnacle of advisory as you are helping your client reach their ultimate desired
destination.
Not only that, but I believe that your clients need this kind of service. They need someone to challenge
them and someone to push back at their assertions,
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The reason for that is because most of your clients aren’t nancially literate enough to make these
decisions on their own.

What was interesting about the Xero survey on nancial literacy was that these business owners
thought they were nancially literate:

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But in actuality, we already saw that millennials and Gen X received poor grades when they were
actually tested.

What’s even scarier is that these same business owners that thought they were nancially literate
actually gave themselves the below scores when it came to “trust in sources of information for
business nancials”:

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They think they’re nancially literate and they trust themselves as a source of nancial information, but
their test results indicate otherwise. 

This is a dangerous combination.

The good news though is that these same business owners give their business advisors equally high
trust scores: ABOUT WORK WITH ME NEWSLETTER BLOG CONTACT    

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This statistic puts you in a great position to therefore act as your client’s coach.
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If you’re looking for a simple coaching framework that you can offer on a subscription basis, you can
adopt an approach that an app called Clarity uses.

First, it integrates with Xero to pull in your client’s 7 basic nancial KPI’s to show them where they are
right now:

Second, you would hold a meeting with your client and indicate what their nancial goals are to de ne
where they want to be. With steps 1 & 2, we have de ned “the gap”.
In the below example, I indicated that our client was seeking a 22% increase in revenues which would
result in 60k additional pro t and cash: ABOUT WORK WITH ME NEWSLETTER BLOG CONTACT    

And then third, you would work with your client to develop a documented action plan:

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You would then meet with your client periodically to help them in areas they are struggling in, provide
your insights and challenge their assertions.

Coaching is a super scalable accounting advisory service if you model it properly.

I know it’s scalable because I offered a model very similar to this in my online coaching program
designed for accounting rms. It’s high margin, high value and not time-consuming.
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4) Develop and Offer Online Courses

The big thing I’m into right now is how accounting rms can develop passive income streams. I learned
a lot about developing my own scalable coaching
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coaching, community and online courses and I’m seeing a ton of smart, creative rms doing similar
things at the moment.

As an example, Susan Boles offers virtual CFO services to coaches, consultants and agencies. The
problem she realized was that a lot of the services being offered were not being well understood by her
clients. So she developed an online course priced at $495 called Not Rocket Finance to help them get
up to speed so that she can then upsell them on to her virtual CFO services.

Here’s an overview of what’s covered in the online course:

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In this online course, she’s giving advice to business owners in a new (but exceedingly popular) kind of
format, doing away with emails and phone calls. Once the course is developed, it’s all pro t from there
on out.

I’m also seeing others sell courses for $1,500 and others turning things into a subscription model.

The point is, when you think about advisory services in 2021, there are now other models to deliver the 
service.
 Watch this space.
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Accounting Advisory Services – Over to You
I hope you enjoyed this guide that covers advisory services for your rm in 2021. I believe the services
mentioned above are highly relevant to what clients need help with in this day and age.

Now I’d love to hear from you.

Do you have a favorite advisory service?

What do you think of the online course model?

Which advisory service will you be implementing rst?

Let me know by commenting below!

Ryan Lazanis
Hi! I'm Ryan. I’m an entrepreneurial CPA that founded Xen Accounting, a 100% cloud-based accounting rm, in 2013. Following its
acquisition in 2018, I started Future Firm to help accountants fast-track the growth of a modern, scalable accounting rm of their own.
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Here are 3 ways for how you can fast-track your own modern, scalable rm:
1) Get my weekly newsletter that gives tips & trick to scale your rm.
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2) Subscribe to the Future Firm Accounting Podcast for bite-sized, actionable lessons on how to scale your rm.

3) Join Future Firm Accelerate, my online coaching program that helps modern rm owners quickly scale.

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