15 Smart Strategies to Effectively Manage an Accounting Firm

Making the mindset shift from accountant to business owner unlocks a new level of potential growth for both you and your firm. However, the transition from solo practitioner to firm leader isn’t always smooth sailing. 

It’s easy to feel like you’re constantly up against deadlines, and your business operations and growth gets pushed aside in favor of focusing on your clients. Don’t fret. If you’re going to scale, there are some best practices that are invaluable for you to invest your attention and time.


  1. Look for new team members before you need them

In today’s labor marketplace, there’s a shortage of workers for most jobs, and accounting is no exception. Accounting is a service business and you want to have the best people for the job. 

If your business can support another team member and is approaching the point where it will need another team member, you should start looking. Waiting until the last minute to start hunting for the perfect hire is going to leave you short on choices. You don’t want to end up choosing from a pool of mediocre candidates. 

If you meet someone who may make a great future team member, get their contact information and have it ready for when the time comes. 


  1. Thoroughly vet your new hires

People present the best of themselves during the interview process, but you need to make sure you’re asking the right questions, and ultimately getting the right people. 

Everyone has their own method of finding the right team members. However if you constantly find yourself hiring people that just don’t work out, it might be time to get outside assistance. 

If there’s someone in your life that is a master interviewer and always finds the right people, ask for help. Sometimes a recruiting agency can provide assistance and placement (though they usually come with a hefty price tag).

Once you’ve hired someone, assuming that you’re not bound by a contract or labor law, be willing to let go of people who aren’t working out. This might be their technical skills, their attitude, or their work ethic. Whatever the case, be willing to let people go that just aren’t the right fit. 

  1. Take seasonality into account.

When you’re building your team, make sure you take into account the seasonality of the business. For tax accountants, spring is a busy time while for other types of practices quarter-end might be the busy time. Seasonality affects all aspects of your business from staffing to managing client expectations. 

Use a  workflow system tool so you can ensure that you are dividing work evenly amongst your team members, and you are able to set client expectations accordingly. Workflow systems can be simple spreadsheets or online systems.


  1. Plan vacations

Whether you’re just getting your business started or a seasoned accounting veteran, you need to have a plan in place that allows you to take a break and recharge. Whether this means that clients are aware that you will be unavailable during certain periods or your team members can fill in for you during your absence, you need a plan.

Without a plan, it’s easy to just keep working and never take time off to rest. This is a recipe for disaster, and you won’t even realize how much less effective your work has become. 

You should also plan breaks throughout the day. Block off your lunch hour on your calendar and guard that time. Go for a walk, read a book, or do some light yoga. A change of pace will guarantee that you come back after your break ready to get back to work.


  1. Stay organized and automate as much as possible

As a small business owner, there are many demands on your time. Along with being an expert in your field, you also need to pay the bills, ensure your employees are getting paid, and manage cash flow. 

You should delegate and automate whenever possible, but there will always be some additional items that can’t be outsourced. When it comes down to managing your practice and managing your client work, the most important thing is to stay organized. You’re juggling a lot of things and the less you rely on your memory for deadlines, the better off you’ll be. 


  1. Set clear expectations with clients

Once you have your team running like a well-oiled machine, it’s important to set your client expectations to line up with your standard practices. If all emails will be answered within 48 hours, let the clients know that upfront. Don’t make them wonder if you received their correspondence when you haven’t answered in a day.

If you want to be the single point of contact, then let them know that. If there are several team members that they can reach out to with questions, they should be aware of that too. 

How you want to run your practice is your choice, but letting the client know how you run your operation in advance will save you a lot of headaches down the road.


  1. Know when to turn down new clients

If you’re in the early stages of building your business, it might be tempting to say yes to every client that comes your way. You need to consider if the client is the right fit for your business model, if you can meet their expectations, and you have the available resources to service that client. If any of these things don’t quite fit, you should consider turning down the client.

By vetting new clients, you’ll be able to provide top-notch service, and you’ll find that your business will grow through referrals from satisfied clients.


  1. Be willing to expand into remote work

Traditionally, accounting was very paper-based. Accounts receivable engagements required paper bills to be delivered, checks to be mailed, and signatures collected. Now, virtually all of this can be done online. 

PDF copies of documents and work papers can replace paper files. This allows you to expand your team in various locations and also allows you to work with clients in distant locations. By opening up your practice to remote work, you’ve immediately expanded your talent pool and potential client base. 

Managing a remote team can come with its own setup challenges. It is important to schedule regular check-in meetings and have systems for managing work when you can no longer judge backlogs based on the number of files piled on someone’s desk.


  1. Review your processes regularly to see if they’re still working

Accounting involves a lot of repetition. This doesn’t mean that you should become comfortable with your current system. You should continually evaluate processes and stay abreast of the latest technological developments. There are any number of mailing lists from the IRS to professional accountant organizations that can provide regular industry updates without you having to hunt them down. 

The important thing here is to be open to change. Talk to other accounting firms and find out how they manage their practices. You should also meet with your team regularly to see if anyone has ideas to increase efficiency, introduce automation, or remove redundancies that are slowing you down.


  1. Ask your clients for feedback

No, you don’t need to ask every client for an evaluation of your services after each engagement. However, you should talk to clients about any hiccups that occurred during an engagement. 

When you’re trying out a new system or software, ask the clients if the update worked for them or what they would like to see in the future. While you can take the feedback with a grain of salt, do your best to be open to feedback and willing to integrate suggestions into future projects to continue increasing client satisfaction.

  1. Cross-train your team members

Most accounting practices are small teams consisting of a mix of bookkeepers and accountants. Not everyone has experience with data entry, payroll processing, accounts payable, accounts receivable, and posting journal entries. But the more of these regularly occurring events that your team members have been exposed to, the better off you’re going to be. 

If all of your team can fill in for any of these items (or at least the most urgent ones), you’ll be able to continue operating in the event that someone is out sick or quits unexpectedly. While it’s not a long-term solution, knowing that things can continue even if short-staffed, is essential.


  1. Consider hiring non-accountants to help you run your business

Hiring an office manager to run your practice might make sense from an operations and financial standpoint. Most office managers need to know some basic accounting (as do most people) such as billing, collections, and data entry, and other administrative tasks.

At the very least, an office manager can handle a lot of the daily, non-accounting tasks that need to be completed in a practice. They might make appointments, call clients with past due bills, ensure that office supplies are ordered, verify that staff is properly allocated, and generally keep the office running. 


  1. Have a system in place for managing your team’s work

Though an office manager may take the lead on ensuring that your practice is humming along, having a system in place to allocate tasks, verify workloads, and track billable versus non-billable time, will allow you, as the owner, to see if your team is meeting its financial goals.  

If some team members are not billing enough hours, it’s possible that other team members are left picking up the slack. Balancing projects and deadlines can help you, and your employees, avoid feeling overwhelmed and burned out. 

Use IT tools that can help allowing you to know what everyone is working on and none of your client work falls through the cracks.


  1. Set a budget for projects

Each project should have a budget attached to it. If you are a tax accountant, you probably have a pretty good idea of how long a standard return should take someone.  

If your team regularly prepares financial statements for the same clients, you’ll be able to estimate the number of hours that those statements involve. Audit projects most likely involve custom estimates for each project.

No matter what type of project you are tackling, knowing the time, team members, and billing rates of the people involved in the project will help you allocate your time and resources to the task.  

Over time, having budgets and calculating variances from the budgets will help you determine which projects are worthwhile and profitable for your team.


  1. Create a strong team culture

Whether you are working together in an office or scattered as a remote team, it’s important to build a sense of camaraderie amongst your team. Teams that have friendly relationships with each other will be more likely to have each other’s backs when things get tense.  

You also build a sense of belonging by getting everyone’s buy-in on important decisions that will affect the whole team—whether that’s hiring a new team member or deciding where to hold the next company retreat. All of these little things add up to a cohesive team that works better together and provides better services for your clients.


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