Written by Glenn Sandler, Founder and CEO – G.I. Tax
What comes to mind when you hear the term “advisory services?” For those of us in accounting, it likely conjures images or memories of scouring through your clients’ paperwork to find overlooked items that could impact their annual returns, and the compliance services that routinely overlap your advisory services.
According to the AICPA, advisory services is defined as services where an accountant, practitioner, or CPA, “develops findings, conclusions, and recommendations for client consideration and decision making.” AICPA elaborates further on this definition in providing examples of advisory services which include, “an operational review and improvement study, analysis of an accounting system, assistance with strategic planning, and definition of requirements for an information system.”
If you read that definition and thought it sounded extremely broad and open-ended, you’re not alone. Each and every firm in the industry will offer their own unique definition as to what advisory services they offer, what those services entail, and how the process of conducting them can provide value to their clients. However, not every firm does the same insofar as communicating the value their expertise plays into the advisory services they provide to clients.
Clearly Communicate Your Offered Services To Clients
At G.I. Tax, each of our locations is trained to provide an umbrella of three primary advisory services to our clients. These services come in the form of:
- Tax Services
- Individual tax returns
- Business tax returns
- Amendment services
- Refund Estimates
- Business Services
- Business creation and founding documentation
- Corporate tax returns
- Business loans
- Bookkeeping services (e.g., drafting financial statements)
- Personal Services
- Income tax preparation
- Credit counseling
- Notary services
- Student loan (FAFSA) assistance
- Auto/Home lending rates
Though there is often overlap between these services depending on the client being served and their individual needs, each of these services we offer share one commonality: our team is able to offer them because of our collective industry expertise. As such, the easiest way I can clearly define what our advisory services are at their core is, “formulating strategies to address client challenges which create opportunities to enable their financial success.”
Using this definition allows our team of professionals to focus on the ultimate goal of our firm: a favorable, winning outcome for all of our clients.
Separate Compliance Services From Advisory Services
It can be extremely easy to blur the lines between what your firm may consider as “advisory services” and “compliance services.” The two, after all, commonly coincide with one another. The primary difference is that, whereas advisory services offered can vary more wildly from firm to firm (with other factors in consideration such as geographic location and local laws), compliance services remain constant across the industry.
As a result, some firms may end up performing either advisory or compliance services to their clients while actually being paid for performing the other.
Here are some examples of how to properly differentiate between your advisory services offered and the compliance services offered:
- Compliance: Tax Preparation
- Advisory: Tax Planning/Strategy
- Compliance: Bookkeeping
- Advisory: Cash Flow Forecasting
- Compliance: Historical Client Records
- Advisory: Real-time Client Data
- Compliance: Verified Calculations
- Advisory: Automated Reporting
Another good example of differentiating between compliance and advisory services lies in the deliverable product to the client. Whereas compliance reports delivered to clients are meant to communicate the value of your services being offered to (and subsequently utilized by) the client, these should be a by-product of your advisory services and the strategies generated and communicated to the client.
Closing Remarks
In our industry, average everyday clients can rapidly be swept up and left confused by the plethora of terminology used. This makes it all the more vital why you and your firm should carefully consider both the types of services you offer and how those services are communicated to your clients. Even though your expertise, knowledge, and wherewithal may be what initially brings clients through your door, your willingness to communicate openly and freely with them is a leading factor in client satisfaction and retention. These factors are what will ultimately set you apart from other competing firms, as ensuring the continued success of your clients will only help to further ensure the success of your company.
