“take action now · practicing certificate - mipa client’s best interest professional...
TRANSCRIPT
Sam ZervidesDirector & PrincipalAustralian Wealth SolutionsDeputy President – IPA Victoria
“Take Action Now to Bullet Proof Your Business Against the Rising Tide”
Disclosure
Practicing Certificate - MIPA
Professional CollaborationClient’s Best Interest
Bullet Proofing Tools
Lawyers
Mortgage BrokersAccountants
Insurers
Corporate Solicitors
Investment Managers
Challenges
What is the rising tide?
Diminishing Client Base
Legislative (APES 230)(SMSF Advice Unless Licensed)
ATO(Standardised ireturns)
Professional Development
“Embracing technology = more advisory & less low value”
Technology
BGL Xero MYOB
“Clunky data entry”
“Less value add”
Disruption AutomationObsolescence
myprosperity
Challenges
Challenges Vs Opportunity
Bullet Proofing
Double Pain
Exponential Growth
“Exponential growth is caused by compounding returns.”
Challenges
What could you do within your business to make it more valuable to the potential buyer?
What would the key challenges be and how would you overcome them?
Sell
Questions to Ourselves
“Accountants underestimate their clients’ need for services they don’t currently offer”
93% of small businesses rely on a public accountant for advice beyond standard compliance and tax-related matters.
⅕ businesses would also like to receive a business strategy.
Advice on financial future and growth
opportunities
“Looking in the rear-view mirror causes accidents, create a journey for your clients to
reach their destination.”*2017 Survey - IPA*”The Australian Accounting Industry” - NAB
“Accountants are rated the most important professional service provider by all SMEs, irrespective of location or turnover”
¼ of SMEs wouldn’t have gone into business if they realised the associated stress.
⅓ wished the engaged with an accountant earlier.
SMEs view their accountant as their most trusted business advisor more than one in two stated this.
*2017 Survey - IPA*”The Australian Accounting Industry” - NAB
“Time-based billing is the main billing method for accounting firms but most SMEs would prefer to be charged a fixed fee”
More than half of all fees accountants charge their business clients are generated by an hourly billing method.
However, more than one in two businesses would prefer fixed fees Only 16% would prefer to be billed hourly.
*2017 Survey - IPA*”The Australian Accounting Industry” - NAB
Client – Adviser RelationshipRoles & Responsibilities
YOUChairman of the Board
CEO of Family WealthDecision Maker
MeYour Financial Planner
Your Personal CFO
Project ManagerAnalyst, Strategist, Adviser, Intermediary
Lawyers
Accountants
Corporate
Solicitors
Mortgage
Brokers
Specialist
Lenders
Insurers
Investment
Management
Engagement Letter
John
Proposed Insurance
Life - $430,000TPD - $430,000IP - $7,828 pm
Agreed, 2 Year Wait,Benefit to Age 65
Personal
Super
CurrentAccumulation
Current: $98,051Retain: $5,000
Proposed Wrap Super
$93,051
Rollover all except $5,000
Wages$100,000
Proposed Insurance
Trauma - $160,000
$4,037 pa premiums
$2,896 pa premiums
Linked Policies
CurrentDefined Benefit
$531,334
$14,000pa (14%) SGC +$8,250pa Sal Sac (8.25%)
(Reduce by $250 pa)
InsuranceLife - $155,116
IP - $4,676Indemnity
90 day wait, 2 year benefit
$3,000pa SGC (3%)
Personal Cash
Jane
Proposed Insurance
Life - $1,000,000TPD - $1,000,000
IP - $3,131 pm
Agreed, Full Cover, 2 Year Wait,
Benefit to Age 65
Personal
Super
CurrentAccumulation
Current: $52,047Retain: $5,000
Proposed Wrap Super
$47,047
InsuranceLife - $49,000TPD - $49,000
Rollover $47,168
Wages$40,000pa
Proposed Insurance
Trauma - $160,000
Cancel once replaced
$2,963 pa premiums
$1,468 pa premiums
Linked Policies
$87 papremiums
$1,200 pa (3%) SGC
CurrentDefined Benefit
$7,687
$5,600 pa (14%) SGC +$3,300 pa (8.25%) Sal Sac
InsuranceLife - $105,875
IP - $2,403Indemnity,
Disability Only,90 day wait,
2 year benefit
Personal Cash
Fee Disclosure Statement
The future of a Accounting Business(if no action is taken)
Accounting Practice Valuation – 1x Revenue pa
The future of a Holistic Accounting Business
Accounting Practice Valuation – 3x Revenue pa
The IPA
What can the IPA do to cushion our members against the rising tide?
Consultants
Members
BusinessesIndividuals
PDMsMembers’ Hub Call Centre
• Conclusion
• Any Questions?