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Management advisory services: a new part of your practice?

Many accounting practitioners are finding a new niche for themselves in the area of MAS (Management Advisory Services). Advisory services are a natural outgrowth of the tax and write-up services which accountants are currently providing for their clients. In many cases, accountants are already providing a form of MAS when they answer typical client questions about business problems. It is an easy step to take a more detailed look at those problems and find solutions which will not only benefit the client but provide a new and financially rewarding addition to your practice.

Teaching a client to use a computerized accounting system for his/her business is an excellent first step. The accountant can work with the client on the selection of the system that will provide the most useful information. It is not necessary to begin with anything overly complicated. Once the client understands the basic use of the computer system for maintaining everyday information, the accountant can then use the material to advise the client with future planning and with forecasts.

Among the most frequently asked questions are those regarding cash management. Many clients know their product and are excellent sales people, but have little or no understanding of the handling of the financial end of a business. An accountant can help that client understand and set up a system for collections and payments. Here the computer can serve several uses. It can be used for standard everyday purposes such as providing tickler files for collection of accounts receivable. Or it can be used to analyze cash receipts and disbursements in order to forecast cash flow and therefore, to help the company achieve maximum use of cash.

The accountant can work with the client on a variety of business decisions. The size and turnover of company inventory may be a significant area where changes can be made. The timing on the purchase of assets or the decision to lease rather than buy can have a substantial effect on cash flow. The design of an effective business plan can readily aid in business growth.

Sometimes the client will ask questions looking for informal business advice, but which readily lend themselves to a situation where the accountant can suggest a structured plan to help the client achieve his/her business goals. In other situations, the accountant in the process of working with the client's books may see an area where he/she can offer additional assistance and services. In order to "advise" a client, the accountant must be knowledgeable about the clients business. Depending on the complexity of the management advisory services, the accountant must be reasonably certain that he/she understands the totality of the situation and can fairly provide the advice and help the client implement any changes.

Management advisory services are a new and growing addition to the field of accounting. But they must be approached with care and knowledge. The NSPA Practice Management Conference in San Antonio, Texas on October 23 and 24 will host sessions on this topic. Take advantage of the opportunity to learn from your fellow practitioners and begin to enhance your own practice.

Maryln A. Schwartz Director of Education & Professional Development
COPYRIGHT 1992 National Society of Public Accountants
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Accounting Scene
Author:Schwartz, Marlyn A.
Publication:The National Public Accountant
Date:Sep 1, 1992
Previous Article:Automating your accounting.
Next Article:Growth through communication.

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