Is Your Accountant Holding You Back?

Take it from a business owner who has actually sat on the other side of the desk: your accountant’s opinions and obligations could be having a huge impact on the advice they are giving you. 

That isn’t to say they don’t want the best for you and your business. However, there are many external forces applying pressure on them  - not the least of which being the ATO and ASIC regulations - that may result in them offering guidance that is skewed to cater to THEIR convenience rather than YOUR needs. 

I’ve seen a number of instances recently where business owners have been poorly supported. They’re redirected from taking action mainly because the accountant was not considering the deeper needs of their client. 

BUT this isn’t about laying the blame for every misstep at your accountant’s feet. (In fact, I’ve shared a lot of the struggles faced by modern-day accountants, and the knock-on effects on their clients, here and here). 

What I want to illustrate with these client case studies is that:

1. You’re in dangerous territory if you believe your accountant knows more about, and is more responsible for, your financial data AND
2. By reclaiming your financial power, you can place the advice you’re given in the greater context of your own knowledge and intuition, rather than following it without question. 

Let me walk you through a couple of real world scenarios that can show you just how precarious your lack of financial power could be.

The accountant ‘nudged them’ out of a timely investment.

I had a husband and wife team referred to me for mentoring: hubby is a tradesman, they have good financial habits and a history of strong financial decision making. 

The wife of the team had been eager to purchase an investment property for some time; they had the cash to make the leap and the stars seemed to be lining up for them. 

HOWEVER.

The accountant expressed so much hesitation at this decision that it knocked the wind out of their sails, and they passed it up as a precaution. Since then, the properties they were considering have increased in price and are now likely beyond their budget. 

All because their accountant told them to err on the side of caution and WAIT.

Now, our knee-jerk reaction here might be to blame the accountant for the missed opportunity. 

But what if these clients had greater knowledge of their financial data AND confidence IN THAT KNOWLEDGE so that they were bold enough to ask more questions? 

Had they drilled down on their accountant's hesitancy further, they may have found his reservations had everything to do with risk aversion for the accountant, not the clients themselves.

Accountants are between a rock and a hard place when asked for an opinion on such matters. Unless they are actually licenced to give ‘financial advice’ -  something that was our sole purpose many moons ago - they must abstain from offering it altogether. Sometimes, this hesitation to offer the opinion can be mistaken as hesitation to encourage you to take action. 

It brings to mind the proverb: Time and tide wait for no man. 

For those of us in business (not just in the business of accounting and tax) we know that if you wait for the ‘best time’ to make bold decisions, you could be waiting a while. Entrepreneurship itself is a daily risk we take! So when you’re feeling resistance from those you have instructed to advise you, it’s critical that you can weigh their opinions against your own experience and insights. 

I also suggest you adopt the ‘5 Whys’ approach for these exact situations. Conceptualised by Taiichi Ohno, this is the process of simply asking ‘why’ at least five times until you feel you understand what you’re being told at a level that is satisfactory to you (rather than sitting shyly, not wanting to disrupt your own meeting!)

Left high, dry and behind on lodgements. 

Sometimes a perfect storm of dropped balls can occur. It’s times like this when you need the data and systems to be optimised to support YOU in your hour of need. 

This client came to me in quite the scramble:

• Tax returns had, for whatever reason, not been lodged for some time;
• Her current accountant was retiring; AND
• The firm was not looking to replace them and handover clients. 

A complete lack of support for my client meant she became overwhelmed and, without a go-to professional and familiar face to rely on, the wheels quickly fell off her financial data management. 

Thankfully I was able to mentor her and get her back on track. But her case highlighted the discrepancy of expectations there are between clients and accountants:

• ‘Old school’ accountants like me came from a time when we were a part of a business owners circle of trust. We were a brilliant mix of advisor, cheerleader and sounding board. 
• With the changes in tax legislation coupled with the tech boom, managing financial data AND maintaining ATO compliance has become more complicated and frankly, daunting. 
• As entrepreneurs still crave that financially-savvy voice of reason to guide them, they have become overly reliant on their accountants and bookkeepers. Tech overwhelm has spilled over into financial overwhelm and accurate data has been completely delegated to ‘the experts’. 
• ‘Advice’ has become tightly regulated, putting the fear of God into all those you traditionally sought opinions from. 
• With the industry being dragged away from advice to a focus primarily on compliance and efficiency, accountants have even less bandwidth than ever. 

Zooming out from the sloppy service this client received from her accounting firm, this scenario illustrates a broader picture: entrepreneurs are incredibly vulnerable when their financial data is inaccurate, out-of-date and out of their control. 

Taking action one step at a time

While much has changed in the accounting space, the fundamentals remain from when I first became a Chartered Accountant 30+ years ago:

• Your financial data is YOURS. These records serve you first. 
• No one will ever need this information, nor care about it more, than you. Accountants will come and go, but this will be YOUR business until the day you sell up or close the doors. 
• It IS possible to simplify the details down until you understand them clearly. It’s about mastering the systems that are storing the information, tailoring them to reflect your real-life business (not the out-of-the-box sample).

Accountants will always be cautious creatures for the most part. Our job is to know who we are dealing with in any given conversation and maintain broader context. 

Think devil’s advocate, rather than gospel truth.  

But the kicker is this: don’t wait until the proverbial has hit the fan before you get your house in order. Because it is the very act of structuring your financial data properly that may mitigate disaster in the first place. 

If that seems like a great idea, but you don’t know how to get the ball rolling, you’re in the perfect place. 

As an accountant-turned-financial-mentor, I understand this issue from both sides of the table. I can support you in finding both the clarity and confidence in mastering the numbers in your business. This puts you in a better position to collaborate effectively with your accountant and bookkeeper. Getting started is easy: just book a free chat with me (here’s my calendar so you can grab a time slot that works for you: https://lizjarvis.youcanbook.me/)