CHAPTER 6

ORGANIZATION AND
MANAGEMENT OF MAS
PRACTICE
LEARNING OBJECTIVES:
1. Understand the basic techniques in developing MAS
Practice
2. Describe the organizational structure of the MAS Practice
or Division
3. Understand the role, responsibilities and qualifications of
the personnel in consultancy practice.
 DEVELOPING MAS
PRACTICE
IF ONE WISHES TO BE A CONSULTANT:
- Must assess his / her talents and expertise
- Needs to review his / her communication skills both oral
and written
- Sales ability ; ability to focus on a project and maintain
objectivity
- Evaluate his / her professional judgment
• The scope of a consulting practice is defined by the expertise and
experience of the consultant within the practice. This can be
technical consulting in
1. Engineering
2. Industrial Management
3. Marketing
4. Business Management
5. Financial Areas
• The prospective consultant should conduct market
research to identify opportunities in the market place.

1. Study of the listing of management consultants

2. Survey of local CPA firms to determine which are offering consulting
services.
3. Identification of new services that may provide a competitive edge.
 GOALS AND OBJECTIVE
• SHOULD INCLUDE:
1. Desired level of income
2. Potential Clients
3. Strategies Obtaining Potential Clients
 BUILDING SUCCESSFUL
NETWORK
• Clients Newsletter
• Articles
• Seminars
• Entertainment
• Phonecalls
 ORGANIZATION OF MAS
DIVISION
• A consulting should periodically assess its needs with
respect to in house knowledge and skills.

When deficiency exist, the consulting firm can

1. Employ additional consultant with adequate knowledge and skills or
2. Undertake a variety of “staff development” activities that are
intended to endow the presently employed consultant with needed
knowledge and skills
 STAFF PYRAMID

1 PARTNERTS, PRINCIPAL ,
DIRECTORS
SENIOR MANAGERS,
1-3 MANAGERS & SUPERVISOR

1-5 SENIOR CONSULTANTS,

SENIORS

2-6 ASSOCIATE CONSULTANT,

STAFF
 PARTNERS, PRINCIPALS,
DIRECTORS
• The most experience and highly paid professional and is
normally responsible for the successful completion of
engagement, dealing directly with clients.
• Principal activities of partners include performing practice
planning, administering and developing practice,
consulting with top-client managers, approving
engagement reports and managing client crisis.
 SENIOR MANAGERS,
MANAGERS & SUPERVISOR
• They perform week-to-week management of the
engagements and are responsible for identifying new
client prospects and assisting in sales process.
• Principal activities of managers include planning
engagements, evaluating consultants, supervising
consultants, writing proposals, reviewing work papers and
reports, consulting with client managers and services as
expert in one or more applied knowledge areas.
 SENIOR CONSULTANTS &
SENIORS
• Typically have 2 or 3 years of consulting experience and
are capable of supervising the daily work of the younger
staff.
• They posses the right combination of experience and
dedication to complete different projects with limited
supervision.
 ASSOCIATE CONSULTANT AND
STAFF
• These individuals usually have less than 2 years of
consulting experience and may have been hired directly
out of graduate or undergraduate school.
 BILLING RATES

LEVEL 1 P10,000 to 20,000 per hour

LEVEL 2 P8,000 to 10,000 per hour

LEVEL 3 P5,000 to 8,000 per hour

LEVEL 4 P2,000 to 5,000 per hour

TARGET LEVEL OF COMPETENCE
OF MANAGEMENT CONSULTANTS
1. Scope of Practice Area – a consultant who desires to
grow
2. Service Variety – range of services that consultants
provide
3. Client Requirements – consultant may assess through
questions
4. Service Delivery Capability – application of consulting
skill
 SOURCES OF MAS
ENGAGEMENTS
• Referrals from other CPAs
• Referrals from audit clients
• Referrals from businessmen
• Referrals from financial and government institution
• Referrals from legal and other professional firms
 DETERMINING MARKET
OPPORTUNITIES
1. PRIVATE SECTOR
• INDIVIDUAL
• SMALL BUSINESSES
• MEDIUM-SIZED BUSINESSES
• LARGE COMPANIES
2. PUBLIC SECTOR
GOVERNMENT

3. GRANT CONSULTING
ORGANIZATION
 FINANCIAL MANAGEMENT OF
AN MAS PRACTICE
1. WORKING CAPITAL REQUIREMENTS
- Use to pay monthly operating expenses such as salaries of consultants,
rent, supplies, utilities and etc.
- Must have atleast 3 to 4 months expenses.
2. OFFICE FACILITIES AND EQUIPMENT REQUIREMENTS
- Should established professional and business like image
- Practical option for start-up firm is leasing an office, leasing office
furniture, employing permanent secretary, multiple employees and other
consultantts
HOW TO SCOPE A CONSULTING PROJECT
IN 4 STEPS

1. APPROACH THE SCOPING CALL WITH CURIOSITY

- Goal is to ask relevant, open ended question
- Careful listening
- Focus on visioning question
2. FOLLOW-UP WITH AN EMAIL THAT OUTLINES WHAT
YOU HEARD
- Opportunity to demonstrate that you fully understand
their challenge.

- 3. DETERMINE THEIR BUDGET OT BUDGET RANGE

- Need to find out what their budget is
- Use pre-survey which they answer a question in “project
budge”
4. SEND A SIMPLE PROPOSAL THAT PROVIDES THREE
PRICING OPTIONS
LOW – Very basic version of the project
MEDIUM – Optimal price which includes what client said
they wanted – you’re trying to guide them
PREMIUM – Primmarily help make the medium option look
reasonable
END OF PRESENTATION 