1. 8 Mar 2010 15:45–16:00

   BBC Radio 4
   Episode 1

   1/10. Jolyon Jenkins traces the religious roots of some accounting practices.
2. 9 Mar 2010 15:45–16:00

   BBC Radio 4
   Episode 2

   2/10. Jolyon Jenkins goes back 5,000 years to see how accountants invented writing.
3. 10 Mar 2010 15:45–16:00

   BBC Radio 4
   Episode 3

   3/10. How a corrupt Roman governor was tried in court using his own forged account books.
4. 11 Mar 2010 15:45–16:00

   BBC Radio 4
   Episode 4

   4/10. The rise of double entry book-keeping in medieval Italy.
5. 12 Mar 2010 15:45–16:00

   BBC Radio 4
   Episode 5

   5/10. Jolyon Jenkins examines accountancy fraud in the Middle Ages.

It will also be available on BBC iplayer Radio for those who cannot listen live.

This is a first. A friend of mine, Tom Ball, is the brains behind a unique idea that could be of use and interest to many professional firms. Hence the reason I’m blogging about it.

AllABoardroom is a meeting room and bar aboard a customised bus. They removed the seats and put in a proper boardroom for 8 people and a bar – and a fireplace.  It’s an inspired idea and provides an innovative working environment for upto 8 people. A boardroom and an executive bar so you can work together and have fun as you travel.

I think it could work well for small team away days so you can work while you travel to your eventual destination. It can also be used for meetings on the go between clients, meetings with prospects – you take the boardroom to them, touring offices and at an exhibition. I’m sure there are many more uses too.

They’ve got a competition to win a free day for your team. Have a look if the idea intrigues you: www.allaboardroom.com

This means that accountants are routinely approached by financial advisers, will writers, software developers, marketing consultants and many other service providers. The only problem is that many such people mess up. They don’t know the first thing about how accountants work, what motivates them or how to get them to refer their clients on to other service providers.

I regularly hear about such encounters – both from accountants who are ‘fed up’ with such approaches, and from service providers whose efforts are failing to secure the desired outcome. Indeed this mis-match led me to develop a seminar (now a masterclass) to help such service providers better understand what matters to accountants. I’ve run the seminar a number of times since its first outing in January 2009 and feedback has been very positive. (Next outing is 17 March 2010).

In addition to my own insights and ideas I have been sharing the data I collated in a survey of accountants in 2008. Over 200 told me what was important to them when approached by someone asking for referrals.  This enabled me to extrapolate some specific advice based on empirical evidence.

Is this still an issue I wonder? Are you often approached? What’s your attitude and response when someone asks you for referrals to your clients?

Some years back when I was a partner at BDO I offered a cost-cutting suggestion that was roundly dismissed by the then powers that be. I had noted how much time and money was devoted to graduate recruitment. The aim then was to persuade top graduates to choose a career with BDO rather than one with the Big 5 or 6 firms (as they then were). This exercise was costly and often disappointing as applicants frequently chose to accept offers from the bigger firms over the offers they received from BDO.

I was conscious that many of the partners in the firm had only ever worked for BDO (Stoy Hayward as it then was).  It seemed to me that the graduate recruitment process was predicated on the idea that the best recruits would continue to want or could be persuaded to stay at the firm post qualification. And that all future partners would thus be home grown.

I offered the view that, “these days” the best people often chose to switch firms after they qualified. Those in smaller firms often wanted the experience of working for larger firms. Those in the (now) Big 4 want the experience of working for smaller but still ‘large’ firms. I also noted that as the firm grew so would it’s need to recruit expert partners who had trained and worked in other firms.

I suggested that we should focus our time and money on seeking to attract the best qualified accountants rather than the ‘best’ trainees.  This would reduce graduate recruitment costs and would free up resources to recruit potential partners of the future only after they had qualified.

But for the recession and the consequent reduction in job opportunities for newly qualified accountants I am sure that the pressure to move post qualification would be just as strong now as it was 12 years ago.

I applaud PwC’s move to widen its net although I sense from their press comment that the change is not as big as it seems. But it is a sign of the times.

I predict that the profession will reduce its intake of graduates into trainee positions in the coming years. Increased automation means that many compliance related services will no longer appeal to graduates (if they ever did). And audit work is largely drying up at the smaller end of the market. Most importantly, firms looking to reduce their costs will not want to engage new graduates to perform ever more basic tasks. These will increasingly be performed by non-graduates. In effect graduates will become too expensive to be accountancy trainees in the conventional sense.

What do you think?

If we don’t do this we will be forgotten. When I was younger I used to think that my sparkling personality, wit and conversation would be sufficient to ensure that I would be remembered. Even if I had been right, the fact is that anyone who had met me had probably also met dozens of other people. In time any positive memory of me would be replaced by more recent memories of newer acquaintances.

So what can we do to keep in touch with our contacts/network?

The easy solution – and one I adopt – is to maintain a database of our contacts. At it’s simplest this will be a list on our phone or computer. More sophisticated approaches involve more sophisticated Customer Realtionship Management (CRM) system.

Emails that get through spam filters and which don’t bounce MAY be read by the recipient. Personally addressed emails rather than newsletters are likely to be more successful. If they are read (and that’s a big ‘if’) such emails serve to remind the recipient that we exist. However, the downside of sending emails is that they rarely engage the recipient in conversation. The easiest way to do this is by the good old telephone!

Easy to say  of course. So why do so many of us avoid picking up the phone when we know we could. Could some reasons include worrying:

• Who shall I call first?
• It’s a while since we last spoke, will he/she remember me?
• They might be too busy to speak to me now.
• They might not want to speak to me at all.
• I can’t think of a good solid reason to call, beyond ‘How are you?’

If you really are an ambitious professional then whenever you have a genuine business related “reason to call” I’ll bet that a lot of these concerns simply evaporate.

If you can’t think of any genuine reasons yourself let me offer some suggestions:

• “I’m just calling to touch base and see how you’re doing as it’s been a while since we last spoke. How’s business?”
• “I’ve just seen something on the web that I thought you might find of interest”
• “I’ve just read something in [magazine/newspaper] that reminded me of you “
• “May I ask for your advice about something ….”
• “We’re thinking of arranging a reception/party for [selected/ all] contacts and I thought you might have some useful tips”
• “I’m looking for ….. who do you know who …..?”
• “It’s a while since we’ve spoken and I didn’t just want to email you out of the blue.”
• “Have you seen the article about xyz published in ABC? Would you like a copy?”
• “I would like to test out something with you … have you got a few minutes?”
• “Please can I bounce a few ideas off you with a view to exploring who else I should be talking to?”
• “I found our last conversation really valuable; I wanted to thank you again and to let you know what happened ….”
• “I’m calling for no particular reason at all. You just came into my mind and I thought we should catch up …” (works better than you might think – especially as it’s genuine.)

All of the above are just “openers”. You can then continue with:

• “How have things developed with …..?
• “I’m putting together our budgets for rest of the year. Rather than rely on guess work I thought I’d be upfront and ask what the likelihood was that you’ll be needing us?”
• “While we’re talking, what are going to be the key issues / projects for you this year?” etc.

It’s probably best to avoid specifically asking for work but you can end the conversation with something like: “Well, it’s been good talking with you again.  Let’s keep in touch, and if there’s anything you ever think I might be able to help you with, don’t hesitate to give me a call.” You must ensure that you don’t sound desperate – even if you are!

The purpose of your call is to keep in touch and  to serve your clients, ex-clients and contacts better.  You’ll be surprised how many ex-clients will give you some more work – and so will your clients and contacts.

One very good discipline is to set yourself a target of say ten KIT (Keep In Touch) calls a week – that’s just 2 a day . Then count down how many you have left to make. That way the total/target keeps getting smaller and this can help your motivation.

When I present my talks on ‘How to avoid negligence claims‘ I often start by asking the attendees if the thought of a PI claim ever keeps them up at night. Most say ‘no’, others reply ’sometimes’ and a few answer ‘yes’ and add further comments:

• · Convinced my knowledge is not as uptodate as it should be but working on it
• · Anyone doing a proper job will be sued at some point in time;
• · Could lose everything;
• · Failure to recognise a claim or a potential claim;
• · Fear of getting it wrong;
• · I have discovered some ‘Donald Rumsfeld’ type “unknown unknowns”;
• · I know I don’t know everything!
• · Because even though conscious of PI issues I am always prone to human error;
• · Due to the ever-changing laws, regulations and the purposive construction of the law;
• · In case I do something wrong that I’m not aware of.
• · Lack of internal controls;
• · Professional image, loss of clients, disciplinary issues with the Institute;
• · Reputational impact and interpretation of advice;
• · Some clients may misinterpret the advice we gave them;
• · Sometimes – if I know I have made a mistake.
• · The law is changing very rapidly and it’s difficult to keep up to date;

I accept that there is little point worrying about something over which you have no control. Remember the old adage: Worry is like a rocking horse; it gives you something to do but doesn’t get you anywhere.

The key point I am driving at when I ask the question during my talk though is whether you are aware of the risks you run in your practice and are taking an appropriate amount of precautions to limit the downside. As some of the respondents implied above, you cannot be in practice, whatever your profession, and not run the risk of making a mistake that costs a client money or of a dissatisfied client alleging that you have been negligent. Equally you cannot operate effectively if you are constantly worried about these risks.

In my talk about How to avoid professional negligence claims I encourage attendees to recognise that the risk of problems arising can be distinguished between those likely to have a big impact and those that will have little impact. Equally some problems are more likely to occur than others. Your response to different risks should depend upon their potential likelihood and their potential impact.

Readers are welcome to attend my next half day seminar on Friday 19 February: How to avoid professional negligence claims. And if you book this week you can avoid the late booking fee too!

1 – Draft a business plan

What do you want to achieve in revenues within a year, 2 years, five years? What will you need to do to achieve those objectives and what will be the consequences and cost of doing so?  Drafting the plan and incorporating cashflow projections will force you to consider related issues and to plan what actions you will need to take to achieve your objectives. Identify and arrange all relevant business insurances as well. Will you work alone or need admin, secretarial or technical support staff? Will you do everything alone or use a Virtual assistant? Sub-contractors? How  will such decisions impact your cashflow projections?

2 – Clarify your service offerings

Will you be servicing private clients? Unincorporated businesses? Partnerships? Limited companies? Everyone/Anyone? (That’s always a mistake by the way). Will you be compliance led or also offering advice? On what subjects do you have the credibility and experience to provide valuable advice?

3 – Draft a marketing plan

How are you going to secure new clients? Where will you go? What will you do? What will you say? What will you spend?

4 – Distinguish yourself

Avoid being seen as just another accountant. Unless you do this you will probably struggle to pick up work from established businesses and from taxpayers who already have an accountant. Your distinction needs to be real and not a figment of your imagination. And it needs to benefit your target clients.

5 – Consider your pricing and billing strategy

Many new firms start by undercutting the competition. This means they build small practices full of cost conscious clients who will never move onto paying commercial fees. Decide whether to set fixed fees for compliance work, value based fees or the more traditional time based charges. Beyond fee levels determine your payment terms – up front, partial upfront, standing orders or only billing after the work is completed with payment due within 7 days? 14 days? 30 days? And what will you do if your payment terms aren’t met?  Factor such decisions into the cashflow projections in your business plan.

6 – Target a niche

You will secure more clients faster if you are perceived as having a special focus on a specific niche – be that clients in a specific business type (eg: shop owners, hospital consultants or dentists), or those with specific issues (eg: overseas property, divorce, large family, business start-up)

7 – Clarify the competition

Research online, in local newspapers, directories and in high street. Check out what others are doing, saying and claiming. You may find someone else has a similar focus to you. Their credentials and promises will be different to yours. You will need to understand those differences and whether this offers prospective clients a choice or means you should consider an alternative niche.

8 – Establish commercial processes

From client sign-up through to billing and cash collection. From the production of tax returns, accounts and reports and your IT infrastructure. Will you be happy to work in the ‘cloud’ or will you need hosted applications and backup facilities?

9 – Keep uptodate

Sign up for online and relevant technical updates across all the areas of work you will be doing. If you prefer hard copy updates subscribe to relevant magazines too. Consider your CPD obligations and how you will satisfy these. Many accountants (over 2,000) have registered to receive unique weekly practical tax updates written especially for accountants in general practice.

10 – Identify reliable technical support

Your professional body may provide a helpline facility. You may be able to call on ex-colleagues. And of course there’s the Tax Advice Network where you can source specialist tax advice as and when you or your clients have a tax problem, challenge or issue that goes beyond what you’re uncomfortable dealing with yourself.  There’s also a low cost fixed rate Tax Advice Helpline. Register to receive weekly practical tax updates written especially for accountants in general practice.

What else do you suggest needs to be done?

“Yet again Stupid Accountant David Rice of Plymouth didn’t turn up to our appointment and didn’t let us know. Wasted trip! USELESS #fail”

A quick online search reveals two accountants with that name in that area (or maybe it’s the same guy and he’s moved).

The point though is that until recently, when a client was unhappy with their professional advisers all they had was word of mouth.  Conventional wisdom suggests that unhappy people tell ten people for every one person they tell when they are happy with the service they receive.

Social media though makes it much easier for clients to blog, post comments on forums and to tweet about their experiences. And twitter especially provides a real time facility for people to unload and SHARE their frustrations – as well as their delights.

Deb’s post last night may well have been seen by only a fraction of her 600 twitter followers. Or maybe they’ve all seen it. Maybe some have told their friends. Maybe it’s been circulated more widely.  Who knows.  Playing devil’s advocate, perhaps there’s a good reason for Mr Rice’s non-appearance.

Is there a lesson here for ambitious professionals – beyond the obvious one re keeping appointments?

I have written about twitter here before. Even if you choose NOT to tweet yourself, perhaps the time is coming when you need to have a twitter account to monitor what others are saying about you on twitter? It needn’t be time consuming and it would enable you to respond promptly and to nip problems in the bud. The bigger brands are slowing catching on to this idea too. The way and speed in which they are SEEN to resolve issues can have a positive impact. Indeed such actions can more than compensate for the earlier critical comments.  It’s also instructive to be aware of what people are saying about you.  I’m not aware of any of the big professional firms who do this (yet).

Another way to monitor what’s being said about you online is to use a free service like Google Alerts. It’s less easy if you have a common name like David Rice (or Mark Lee!) but it can be done.

Any other related tips?

The only one I picked up though was their 10 page colour ‘magazine’. It was on the table in reception and looked as if it would be more interesting than the promotional leaflets.  I appreciate that I look at such documents in a different way to the target reader (clients, prospects and referrers) so perhaps my view is not relevant.

The magazine was well laid out and contained some interesting commentary and articles. Full marks? Er, no.

Although the first few pages were still current the tax news was decidedly out of date. And out of the 12 tax and VAT items I counted 5 that had been either been superseded by events or by more recent announcements. And there were 3 others that mentioned relevant dates in July, August or September 2009.

I checked the front cover – This was the summer 2009 issue of the magazine. The winter issue won’t be published until February.

On balance I think that, in this case, the typical reader would not be put off. But the publication schedule strikes me as odd – and indeed risky, especially as regards tax news and advice. Should the firm have removed the magazine from display at Christmas?

If you’re going to publish a regular mag of some sort you either need to ensure it excludes time sensitive material (and for this purpose tax content is invariably time sensitive). Or publish at least 4 times a year – no more than 3m apart. OR, and I think this is probably the most cost effective solution for smaller firms – buy in the magazine, newsletter or content from a third party copywriter or publisher. Ensure it contains your branding and some news on your practice and spend your time on other activities rather than collating, editing and/or writing a newsletter/mag.

What do you think?