Wish you had a way to get referrals from some of the financial advisers your clients are working with? You're not alone. Not surprisingly, advisors wouldn't mind getting a look at your little black client book either, according to a recent poll.


As reported in an article published this month by the Financial Planning Association, the results of an informal survey showed that nearly 90 percent of some 500 financial professionals polled wanted to ask for referrals from CPAs, but were uncertain about doing so. Among 63 CPAs questioned, nearly two-thirds wanted to ask for referrals from advisors, but weren't sure how to ask.


Why is it that CPAs, who typically cite client referrals as their biggest source of new business, are apparently still reticent to ask for referrals from other financial professionals, and vice versa? Surely, the members of two professions that are both based on relationships and that specialize in getting people to spill their financial guts cannot be so overcome with shyness or hindered by an inability to communicate that they can't pursue something as casual as a referral relationship.


The article ("17 Questions CPAs Wish You'd Answer") offers two reasons for CPAs' hesitance. One is that CPAs worry about potential liability if the person they refer clients to isn't credible, and the other is that CPAs resent being thought of as "the First National Bank of Referrals."


From the CPAs I've spoken to on the subject, both are 100 percent true. Another reason I've heard is that many CPAs get tired of sending clients down the street and getting nothing in return, and decide to start offering financial services themselves. But that's another issue. Back to those who still want to go the referral route ...


The rest of the article -- which by the way, appears in the May/June issue of the FPA's Solutions publication, reads like a primer on how to court a CPA. But some of the advice it prescribes for financial advisors on wooing CPAs for referrals could easily be applied to CPAs looking to do the same.


For example, for those who aren't sure where to begin their search for a referral source, the article suggests looking at the names of the CPAs listed on their clients' tax returns and contacting their state CPA associations. Likewise, in the course of gathering their clients' financial information, CPAs have access to the names of the other advisors working with their clients.


The author also wisely encourages advisors to do a good amount of homework related to their own practices prior to pursuing a referral relationship. In developing their pitch, the article suggests that advisers make their case with specifics about what kind of clients they want to work with, what services they will offer to potential referrals, and how the CPAs' clients could benefit from their expertise. It also advises that they anticipate and prepare to answer a number of questions that CPAs will inevitably ask, like, "How can you guarantee that I won't face any liability from recommendations you make?", "How can I be sure you'll do a professional job for the people that I introduce you to?" and "How can I be sure that you won't damage my relationships with people I introduce you to?" No doubt, those are some of the same questions that advisors would ask of a CPA hoping to working with their clients.


So, are you still interested in getting those advisor referrals? Better start doing your homework.

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access