About a decade ago, a new disease infected the accounting and CPA business – the practice management consultant. These geniuses, who have never or only briefly worked in the profession, sell anxious owners on the idea that there’s a magic answer to make the business easier. If only you listen to and pay them, you’ll be driving that Maserati in no time.
They sell fear – fear that there’s something the smart people know that you don’t. They are the accounting business equivalent of the business coach we warn our clients against. Why do we fall for their pitches? Because, as a profession, we lack self confidence.
Our profession’s snake oil salesmen sell products and services to us that they’ve never implemented themselves. This quote, wrongly attributed to Mark Twain in the movie, “The Big Short”, might have been leveled at practice management consultants. “It ain’t what you don’t know that gets you in trouble. It’s what you know that just ain’t so.” Here’s an example.
Lat week, I endured a webinar that purported to tell us how to double our revenue. I expected another diatribe on value pricing / billing / whatever they want it called this week. Instead, the webinar gave us a genuine nugget of wisdom. If we provide more value, we will be able to bill more. Yes, that’s it.
The webinar leader’s solution to providing that extra value to tax clients is to prepare a “back of the envelope” personal balance sheet for each tax client. Then we can bill more for the tax return and the balance sheet than for just the tax return. Amazing logic. Work twice as much, bill twice as much revenue.
Those of us, who actually work in the profession, know that the “back of the envelope” personal balance sheet is problematic. The webinar leader gave no indication of how the balance sheet fits in with S.S.A.R.S.. Is it a compilation or a preparation? Obviously, you need an engagement letter that covers this. Do you put this in the same engagement letter as the tax return and risk mixing an attest service with a non-attest service? What if the client gives the balance sheet to a third party?
So now in addition to hounding clients for answers to tax return questions, we must now hound them for answers to put together the balance sheets. Let’s not even question if clients are willing to pay for this. There’s no line forming outside my office to get personal balance sheets. Out of all of our individual tax clients, we prepare less than a dozen personal financial statements each year. If the bank doesn’t want one, no one else does.
Of course, the webinar leader never talked about any of this. Why? He doesn’t actually do it. I would write that it’s a grand theory, but it’s not that grand. Work twice as hard to make twice the money. Sign me up for another 2,000 hours each year.
Here’s my hierarchy for practice management advice:
- People who are doing it.
- People who did it.
- All of the other seven billion morons on the planet.
If you’re getting practice manage advice from someone, who has never owned a practice, you’re getting lousy advice, and you deserve it.
Thanks for reading!
Frank Stitely, CPA, CVA
Clarity Practice Management