What Is Proactive Strategic Advice and Why It Matters to CPAs?

CPAs are overwhelmed with a rapidly increasing pace of technological changes and are constantly looking for ways to stay relevant and ahead in the competition.

What Is Proactive Strategic Advice and Why It Matters to CPAs?

According to a survey by The Sleeter Group, 72% of small business owners changed their accounting firm or CPA as they gave them only reactive service and no proactive advice. More than 60% of respondents agreed that this factor played a significant role.

But what exactly is proactive strategic advice?

Why is this so important for the finances of a small business?

What Is Proactive Strategic Advice?

A proactive strategic approach means exploring beyond the existing business’ finances to target areas of advancement. Proactive strategic advice would make CPAs stand out and gain new clients for these three key reasons:

  • CPA with proactive strategic advice would update your accounting records more frequently than quarterly. It would help in providing your business with a real-time focus on cash flow, tax liability, and accounts receivable.
  • This kind of strategy includes going through the data to recognize current financial trends in business. It helps them identify what their successful clients are doing and using the information to guide them in ways to streamline their business processes.
  • Such CPAs are forward-thinking and consider strategies that help you save time and take initiatives to report minor accounting issues.

Not All CPAs Are Created Equal

The key difference between a regular CPA and one that is considered as ‘proactive’ is that the former would review your business and help with processes like reporting, bookkeeping, tax, and compliance, while the latter would help you with these services along with providing professional advice on a wide range of businesses issues such as planning and strategy.

It’s important to include CPA in your formal business planning process as they can give you advice on ways to maximize your revenue and long-term strategy for business growth.

A CPA with a proactive strategy would be able to go beyond numbers and help you find ways to improve your business by suggesting value-adding strategies. Every small business owner is concerned about the amount in their bank accounts.

With a proper structure and system in place that can monitor and manage cash flow, you have enough time to focus on important business processes, improve the efficiency of businesses’ operations and boost your marketing efforts.

How Businesses Select Their CPA?

To understand how businesses select a CPA and what things are important while making a decision to engage a CPA, The Sleeter Group conducted a survey and asked them to rate each factor while selecting a CPA, using a scale of 1 to 10 (1 being least important and 10 being most important).

According to the results of the survey, proactive strategic advice was considered as a third-highest rated factor. This clearly shows that businesses want a CPA who can contribute to the planning and success of their businesses.

How SMBs Select their CPAImage Source: The Sleeter Group

Simple advice by CPAs such as relating electronic documents with accounting transactions, technological transformations, or providing a simple solution for online document sharing can go a long way for business success.

Do Clients Want CPAs To Give Proactive Advice?

Yes, of course! Business owners consider CPAs as resources with skills and proficiency to help them prosper. However, if they aren’t equipped to resolve issues or suggest ways to streamline business processes, then the business owner may lookout for another CPA who will.

It implies that if your company is not willing to offer strategic advice, you may lose clients. You need to make sure that your marketing strategy highlights your ability to provide proactive strategic advice to the clients.

CPAs should help their clients understand the key areas of their accounting processes, even if the clients are short of time or interest to gain knowledge of the numbers. This is important for three main reasons:

  1. The focus of business owners remains on present-day challenges and tomorrow’s goals. They may not find the past financial data as helpful without some help indicating how it can be useful to their business success.
  2. Business owners may find financial ratios and the terminologies used by accounting professionals confusing. While your clients may be the best in offering their products or services, they don’t have any official financial training to handle accounting and can benefit from yours.
  3. Owners may not consider the potential payoff to invest their time in understanding financials. CPAs with proactive strategic advice can help them recognize the advantages of financial analysis.

Take the First Step

Knowledge of CPAs is valued, and clients are willing to pay for it. However, if you, as a CPA, don’t come up with solutions proactively and follow a consultative approach, you are essentially asking your clients to go through the services, see if your service matches with their pain points, and start the discussion.

This would be asking a lot from a busy business owner. So, what measures can a CPA take? If you are thinking about where to start, answer to the following questions can help.

  • How can my service help them save time?
  • How can my service help them save money?
  • What kind of improvements can I suggest in their existing business strategy?
  • How can I prove my value over time?
  • How can I help to make their business more profitable?

Providing your clients with easy to understand data on a regular basis would help them evaluate results on a monthly or quarterly basis. It would strengthen your relationship long-term with the clients as you have a common understanding of performance over time.

Become Tech-Savvy

The advancement in technology has helped to simplify most of the manual and tedious tasks. Moreover, clients are expecting more and faster responses from CPAs in the present time.

Adopting modern-day technology like cloud computing and AI will provide flexibility and automation for various processes. You get anytime, anywhere access, enhanced security, scalable resources, and more so that you can focus on your core competencies.

Final Words

Proactive strategic advice by CPAs doesn’t just keep the clients happy, but it also becomes a marketing tool that helps bring in more business. So, they should take a proactive approach to make sure that the clients understand how accounting processes can benefit their business at large.

Investing in this practice now is a valuable business decision, which may lead to significant dividends down the line.

Feel free to share your thoughts about proactive strategic advice in the comments below!

About Julie Watson

Julie is a dynamic professional with over 16 years of rich experience as a VDI and Application Hosting expert. At Ace Cloud Hosting, she humanizes disruptive and emerging remote working trends to help leaders discover new and better possibilities for digital transformation and innovation by using cloud solutions with an enterprise-class security approach. Beyond work, Julie is a passionate surfer.
On the weekend, you will find her hanging out with her family or surfing around the North Shore of Oahu.

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