I remember well, when I was learning my trade as an accountant in the eighties, how useful form 64-8 “Authorising your agent” was.

Back then, it was the key to being able to have friendly (usually), informed and time-saving telephone conversations with HMRC regarding a particular client. It meant you could talk directly with the Tax Inspector dealing with that client’s affairs at your local tax office; someone you knew by name and, in most cases, had met face to face.

It therefore made perfect sense to get all clients to sign a 64-8. It was in everyone’s interest and all parties (the client, the accountant and the tax office) benefited.

Now, fast forward to 2010. Times have changed. Things are much, much different. If I was starting a new practice now, I would make it a rule that we did NOT allow ourselves to be authorised under forms 64-8.

The form has become a poised chalice for accountants. The client still benefits from the arrangement, and HMRC certainly do, but the accountant? Absolutely not. For the accountant, being the authorised agent now just means lots of extra hassle, wasted chargeable time and paper handling.

The 2010 version of the 64-8 arrangement for the accountant means fighting your way through call centres (who might never actually pick up your call), remote HMRC administrative offices and revenue staff who have little idea what you are talking about. The client gets frustrated with you, thinking that you are not doing your job properly, or making excuses. Of course, they don’t want to pay you for all this wasted time.

Then there’s the paper mountain that a modern form 64-8 brings to your office. Huge piles of client statements of account are just one example. You process all of this paper, soaking up more staff time and then spend even more time because you find errors that need to be corrected. Back to the call centre merry go round again.

So, I say let the clients deal with HMRC direct. Let them understand how much time this takes and let them call you in (for a fee) when they either can’t cope, or put a higher value their time. And let the revenue take the flak from the client when they prove to be inept on a regular basis.

Reading this posting on AccountingWeb got me thinking about this unrelated piece at CPA Trendlines and what the future holds for the “Client Testimonial” – as used in the marketing materials of professional service firms, particularly on their websites.

I think testimonials don’t work and are open to abuse in many ways, as the comments on the AccountingWeb thread suggest. The fundamental problem is that the person reading a testimonial knows that they are only being presented with a partial view; they have no way to validate their opinion on it without access to the broader picture.

The next generation of clients, in particular, is savvy to this and they have grown-up in a world where Google lets them assemble something like the full picture from a jigsaw of pieces of information scattered all over the Internet. They are not, therefore, going to take any testimonial in your marketing at face value.

So, why not make it easy for your potential clients to see the full picture in the first place, from your site in a manner you have some control over?

The way forward is for professionals to open as much of their work, and their interactions with clients as possible. Show people as much as you can about what you do, how you do it and what the response from your clients is. Share the ideas you are working on, share the problems that you and your clients have faced and then, only then, share the praise they have given you. Share that praise in a way that is transparent and (prima facie) obviously unsolicited, real-time and real world.

The good news is that the technology to make this easy is already out there and, depending on your requirements, free.

I say the firms that have the balls to expose themselves like this will be the firms that win the next generation of clients. Oh, and if you are scared of hanging out your dirty washing, do everyone a favour and stop taking on new business until you sort yourself out.

I recently participated in a discussion on AccountingWeb where I questioned the value of including detailed technical and tax resources on accountants’ websites.  My long-held view is that such resources are a waste of money.  If I were a client, I would want to pick up the phone and get the answers I need.  I would not expect to find them for myself, “on the website”.

However, since there are many providers of technical content and many accountants including their services on their sites, I wondered if I was alone in my view – so I created an online survey and asked for responses.

With only limited public awareness of the existence of the survey, I am pleased to have received 32 responses.  I promised to publish the results and here they are (pdf format).

I believe that the results support my view including technical content on an accountancy firm’s website is not good use of the marketing budget.  Some 24% of firms had no idea if clients or prospects ever used it and less than half (47%) thought that the cost of technical content represented value for money.

Looking at all respondents, including those who did not include technical content, only 16% of firms reported receiving more than “one or two” enquiries per month from their website.  This, despite the fact that the overwhelming majority (85%) had refreshed the look and feel of their site recently (less than three years ago).

So, I stick to my view.  Accountants need a professional web presence but only something that a prospect can use to “kick the tyres” before making contact to initiate a discussion.  Existing clients will likely never visit the site, because they have no need to – and if you think tools, guides and calculators on your site will make them come you are deluding yourself.

Accountants, think for a minute – you are a supplier in your clients’ eyes.  Now, thinking about yourself, when was the last time you checked out the website of the firm’s PI insurer or stationery supplier?

I have just spent 10 minutes writing a comment to this posting over on Accounting Web, then thought that it would be better to set out my thoughts here.

There is a fundamental misunderstanding in the Accounting Web discussion, when contributors state (rightly to some extent) that transactions cannot be keyed into the online accounting services, like Xero, Kashflow and Free Agent as quickly as in desktop software, like Sage and QuickBooks.  The problem is speed, many say.

If your practice is providing what I would term “binge bookkeeping” services, meaning processing client records in batches, perhaps monthly or quarterly, then there is little benefit from using online accounting systems for 3 reasons:

1. the client is clearly not interested in maintaining accurate, up to date accounting records, so there is no need for real-time reporting
2. because the client does not need real-time information, there is less downside in sending backup files to the accountant and back – indeed perhaps the data file is permanently with the accountant, with the client only having financial information provided in the form of reports produced by the accountant, and
3. data in batches can be entered more quickly using the interface of desktop software compared with web-based software (with the exception of live bank feeds and bank statement upload files)

However, if you wish to provide a management accounting service, in collaboration with your clients, then online is the only way to go.  The client would typically enter most of the transactions themselves, in very small numbers but very frequently – i.e. daily.  No speed problems here then.

The accountant’s role is to monitor, review, correct and complete the records – then use the real-time numbers to help the client manage and grow their business.  Doing the “clever bits”, like calculating and posting depreciation or making the stock adjustments at the month end, is high value but low transaction volume work.  Again, speed is not therefore an issue.

So my argument is that web-based accounting systems are modern tools to enable delivery of modern services. Accountants can stick to traditional desktop tools if all they want to deliver is a traditional service.  I know which horse I would rather have my money on in that particular distance race.