A new report by the International Federation of Accountants highlights the expanding role of small and midsized practices in advising their business clients.
IFACs Small and Medium Practices Committee has published an analysis of research on business advisory services provided by SMPs. The extensive analysis includes a review of global research spanning academic studies, practitioner surveys, and interviews of SMP partners.
The analysis suggests that the needs of small and midsized enterprises the sector commonly served by SMPs are changing due to an increasingly complex regulatory environment. The needs of SMEs are also changing as their demands shift from the use of SMPs for statutory audit requirements to business advisory services, including forming business plans and financial forecasts, identifying and managing risk, information technology, and business valuation.
While the number and variety of SMEs continue to expand, evidence suggests that SMEs have difficulty obtaining access to credit and other resources. The analysis shows that SMPs are well-equipped to expand their services to meet the increasing needs of SMEs.
The findings show that an important way for SMPS to improve their ability to meet these needs is by building referral networks, allowing them to expand the expertise available to their clients. The research suggests that referral networks are currently being underutilized by SMPs.
This research, which noted competency, trust and proximity to their clients as key factors underpinning a strong SMP-SME relationship, is an important step in the committees initiative to learn how SMPs can position and equip themselves to better support SMEs, said IFAC SMP Committee chair Sylvie Voghel, an SME owner-manager herself.
The results of the research analysis are presented in the information paper, The Role of Small and Medium Practices in Providing Business Support to Small- and Medium-sized Enterprises, which is available in the SMP section of IFACs Publications and Resources site, web.ifac.org/publications.
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