Accounting for the Future: Encompass Webinar

•  341 firms •  Sole practitioners through to multi-office

and multi-partner firms –  City, suburban and regional

Good, Bad, Ugly (Business Fitness)

“For firms to flourish in this fast changing environment they must embrace new technologies, lower costs and resources to achieve greater levels of efficiency yet deliver more value to clients”

•  Revenue – Maintained at 6% – WA, VIC larger than other states

•  Profitability – Net Profit per partner (excluding salaries)

•  Lower Quartile $214,983 •  Upper Quartile $449,012 •  Median $326,835

– Apply a salary of $200,000 per partner

•  26% of firms were not profitable

KPI’s

•  Leverage – Key driver to revenue and profitability – Top 25% had leveraged 8 people per

partner •  Partner Return on Effort

– Return a partner receives for each hour worked exc salary

–  Increased to $175

KPI’s

Area  of  Focus   2013   2012   2011   2010   2009  

Partner  return  on  effort   $175   $156   $157   $151   $145  

Total  hours  worked  per  partner   1,920   1,958   1,923   1,925   1,887  

Produc@vity  of  partners   48.1%   49.8%   48.4%   48.6%   51.4%  

The result of this information together with Write-offs was summarized as “If you make a concerted effort to focus on ‘creating more time’, you will solve the number one challenge for accountants. And you will never have to worry about growth again.”

KPI’s

•  Work in progress –  A strong focus has seen these reduce.

•  Debtors –  Debtor days have reduced to

•  high of 76 days •  low of 44 days

•  Expenses –  Total expenses and salaries as a percentage

of revenue increased •  High 65.5% •  Low 38.9%

KPI’s

2013 2012 2011 2010 2009

Growth Growth Growth Growth Growth

Efficiency of process Efficiency of process Key person of dependence

Profitability Profitability

Key person of dependence

Management of workflow

Productivity Cashflow Cashflow

Getting new clients* Getting new clients Profitability Productivity Productivity

Cashflow Key person of dependence

Efficiency of process Introducing new services

Write-offs

Challenges for the future

•  Increase in demand for technology and especially cloud technology

•  Accountant still seem more inclined to recommend cloud software to their clients than adopting it themselves

•  1/3 of accountants now provide tax returns and financials in a digital format.

•  Looking for efficiency in job turn around times

Efficiency – The report

•  Adopting the right technology is required to remain competitive

•  Improved processes and procedures are required for efficiency and quality of work

•  It cant only be about processes and procedures, it needs to improve professional understanding too

Technology in Professional Services Today

Trends in Professional Services Tech

Two main technology trends within Professional Services today:

Automation

•  Bank feeds sharing data •  High volume, high risk of human error •  Repetitive and mind numbing •  Taking the professional out of the picture

Internal Business Management

•  Practice management, Accounting, time billing,

workflow, document management •  These tools, in most cases make the same

task take longer than it did 10 years ago •  Timesheets, classifying documents, scanning,

filing - add time today but save us tomorrow

•  Technology is adopted because of what is on offer.

•  We are all limited to what is available.

•  Maybe we are just not looking for the right things.

What is the point?

What are you trying to fix?

How do I convert the problem of

information overload

...Into a competitive advantage?

•  Instant Advice

•  Be able to proactive not reactive

•  Communicate in a universal language

•  Offer additional services based on a more complete understanding of your client

•  Add value to your hours saved, benefitting everyone - including your client and bottom line.

Using information to drive real growth

Turn This Single Extract,

Into This

And Add All This

To Create This

Imagine taking even a single document That looks like this...

A single click turns it into this

Learn to Swim Not Sink

Recognise your needs and find the solution to address:

–  Searching –  Volume of information –  Communication...with

everyone –  Access the data not

just the paper