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Digital Accountancy Show 2024

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16th & 17th April 2024, Evolution London



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Delivering data as a service – evolution, rather than revolution

In a world where people clamour for their accountants to do more, is offering data services the next logical advisory step for the profession? Practice seniors from 15 small and medium-sized firms gathered with Digital Accountancy to discuss the model’s viability.

The importance of data to a business

A Forrester report from 2012 found that 88% of the data businesses create is unused. Business leaders may comfort themselves that there’s simply ‘too much’ data but, as experts suggest, the bigger issue is not leveraging the huge amount of data at hand.

“Where we have data in silos, disconnected from those making decisions; where there are manual processes and a lack of expertise; then support is needed,” says Data Cubed & Boomboard founder Nick Merry.

“There’s amazing technology out there, but very few know what to do with it,” says Lisa Miles Heal, CEO of Silverfin. “There’s tremendous value that can be created with data, which equates to money and, often, scalability.”

How data and analytics are valuable as a service – and how to make money

The fundamental value in data, explains Miles-Heal, is that it can be turned into information, and then leveraged into insight – be it for the government, and individual, or a business. 

Nick Merry explains that accountants often support small businesses in building their finance systems. This is done from the perspective of flowing robust information into the accountant for statutory reporting and tax purposes. However, it’s step towards the end client being able to use the data itself for running the business – if similar projects happened in the organisation then it would be in a fantastic position to make better decisions.

“Suddenly you can see and understand things that you may never have realised,” says Merry.

Where does the accountant fit?

A number of key points were raised as to the ‘best fit’ argument for accountants to offer data advisory services:

  • Accountants are already businesses’ key, most trusted, adviser.
  • They have an affinity – and training – to analyse information.
  • Practitioners are well versed in organising a flow of data between clients and third parties (eg. HMRC and Companies House).
  • Increasing automation is focusing accountants on the provision of other services, and to manage the risk of the commoditisation of their standard compliance offerings.
  • A wide range of cloud-based tools and apps are available to help with client communication and data transfer – the realm of real-time reporting is here.
  • Accountants already provide ‘basic’ data advisory in the form of accounting, tax production and workflow software advice.

What are the key hurdles?

Key hurdles outlined by the practice leaders came from a number of perspectives. Many questioned the basic premise that accountants are already proficient at accessing data and using it to create insights – with the spectre of Making Tax Digital (MTD) looming large in people’s thoughts. If practitioners are struggling to access basic financial data from their own clients, then is ‘data as a service’ truly possible for accountants to achieve?  Points raised include:

  • “We’re busy delivering the compliance information and doing what we’ve always done – how do we break out of that?” 
  • “We have lots of information produced digitally, but how do I report on it in a meaningful way?”
  • “How do we do standardise to create a systematic approach when everything we do seems customised per client? Dashboards are great but they need a lot of work to create useful insights. 
  • “We spend too much time on building numbers.”
  • “If different types of clients will benefit from different types of data offering, how do we work out what will fit?”
  • “We’ve a large number of clients, how do you get their data tidy? And at what point? Is it about automation?

Overcoming those hurdles

While MTD may be viewed as the bane of accountants’ lives, its is forcing them to find smart and systematic ways to deal with their client base; whether it’s segmenting them according to their digital needs/requirements, automating or outsourcing tasks, or pushing the client to take up accounting software.

These steps are virtuous ones. They free up the adviser to better analyse the information coming into them from their client base, which engenders more valuable and forward-focused advice – which may encourage the clientele to ask for more services.

“If you as accountants can improve their literacy of data, then they’ll be hungry for more; therefore when you offer them further insights they’ll be more amenable,” explains Merry. “If they’re financial reporting isn’t up to scratch, then pick it apart and suggest tech-led solutions.”

An important part of the discussion revolved around ‘not being perfect’. Having your own internal struggles with data management, and its flow from clientele, doesn’t preclude you and your firm from offering data services.

One adviser said that the firm had employed a ‘data scientist’ to help them extract, analyse and present information within the organisation itself. If that works to plan, then the scientist will undertake that role where required for clients – shifting the individual from a ‘cost’ to the firm, into someone that will be able to bill chargeable time. “The partners could see the benefit of them internally – they don’t even know there’s a plan to charge them out down the line,” the delegate said.

Lisa Miles-Heal said that ‘value chain mapping’ is a fantastic exercise that accountants could undertake with clients. “Most businesses have core functions that support them and parts that make it run well. So, you can ask clients: ‘Are your systems telling you things that you need to know?’ If they’re not, then support them to help extract the information they need – once you’ve done that, they will ask you for further insight.

One adviser concluded: “We helped a business organise its core financial system. They have better information which means we can give better advice.”

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