CPA firms, like many other businesses throughout the country, are feeling the sting of the recession. The mood of the client-firm relationship is somber at best and panicked at worst. In light of these realities, it is of crucial importance for accounting firms to frame the value of their "softer" assets. By softer assets, I mean a number of intangible but highly valuable characteristics embodied by most CPAs and their firms.


The asset: Surveys continue to confirm that accountants are a closely held business' most trusted advisor. More than bankers, brokers, insurance agents and attorneys, accountants are seen by a business owner as crucial to business, and even family, decisions.

Business owners and wealthy individuals see their accountant at least every year for tax planning and tax return delivery, and possibly financial statement preparation. With "A" clients, contact might even be monthly, weekly or, in some cases, daily.

The conversation with good clients usually goes way beyond compliance-oriented issues and upcoming financial decisions. A great amount of time is often spent discussing or listening to issues about the client's industry, employees, vendors, adult children, or parents. All of this conversation, coupled with a strong sense of the CPA's confidentiality and independence, leads to a level of trust that is virtually unrivaled by other professionals.

The opportunity: Unfortunately, many accountants have a history of being primarily reactive, with a bread-and-butter business that is comprised of tax returns and financial statements - backward-looking documents. The trusted advisor position gives the accountant an opportunity to go beyond "reaction" and initiate discussions on other areas that are at least as critical, and probably more important, to the client's future. The right questions, delivered with an eye to understanding the client's needs, can play right into the additional services that a firm has to offer.

Asking a client about the legacy she wants to leave can lead to estate planning. Asking about retirement goals can lead to wealth management services. Asking about demand forecasts and working capital needs can lead to outsourced CFO services. Asking about a client's management team can lead to executive recruiting. Asking about succession plans can lead to family business consulting. The point is, using the trusted advisor position to be proactive and ask clients about their future plans in specific areas can lead to a wealth of new opportunities.


The asset: Many clients in most CPA firms have been clients for generations. This gives the firm a chance to view the client's people, issues, changes, successes and failures over a very long time period.

For example, if you look at several growth spurts in the client's revenue over many years, there may be commonalities in how the client's management system takes advantage of unique opportunities during those times. What does the client do, time and time again, to succeed? When the client loses money, are there certain market trends or particular behavioral or decision-making processes that contribute to the loss?

The firm's asset might best be thought of as a rich repository of observations about clients that go beyond the numbers.

The opportunity: With such an historical and observation-rich client perspective, the CPA can contribute to the intellectual assets of the firm to enhance the firm's value. By combining the observations of clients made by every partner and manager and thinking of them as intellectual property, client "best practices" begin to emerge. Which practices lead to better management? What strategies lead to more successful transitions? What kind of cultures lead to less employee turnover? What are your clients' most common responses to market downturns? What behaviors most often lead to business failures?

As themes begin to emerge, you have the opportunity to communicate your "findings" - your intellectual capital - to your clients, your prospects and the public, ultimately enhancing the image and depth of your firm. Communicating to an audience that you not only know technical issues and solutions (a basic expectation of a CPA), but that you are cognizant of the best business and family management practices, only adds to your reputation as a knowledgeable business advisor.


The asset: Accountants are generally seen as quantitative people. They help gather and organize data, they crunch and make sense of the numbers, and they churn out the historical trends and ratios. If you consider a regional firm, they have literally hundreds of thousands of tax returns and financial statements, with specific categories or line items that offer a perspective, a narrative, on a business at a particular point in time. And while confidentiality is an ethical imperative for a CPA firm, the aggregate data can tell interesting stories about industry players and indicate certain trends about peer groups of clients.

The opportunity: Telling "the story" behind the data can create a significant perception of technical depth for a CPA firm. In my last role as practice leader for agribusiness at Kennedy and Coe, a group that audits the cattle feeding industry compiled data and ratios from audits and used the results to educate owners and key employees on trends, key ratios and areas for departmental improvement. When lenders saw the expertise we drew from the lessons of aggregated data, they not only referred more business (sometimes even requiring that a prospective client use our firm), but also asked for training for their loan officers on key financial and management indicators, which was a new service opportunity. When our economists looked at the data, they saw more management lessons and crafted a low-tech newsletter that generated significant new business opportunities.

In my experience, good CPAs often provide this comparative perspective informally. If they back it up with the data, new opportunities arise with similar clients, prospects, industry associations, and the associated vendors to that industry, because the data has been converted to a useful narrative that gives a broader group of people a sense of what is happening within their business and their industry. It shows that you know the business inside and out, which is valuable all the time and especially in an economic downturn.

Lance Woodbury spent 14 years working as a non-accountant in consulting and leadership positions in a regional CPA firm, including six as a partner. Reach him at

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