Starting your own accounting firm?


We’ve got some important steps for you to keep in mind, and facts that we hope can help you too!

Current state of the accounting industry

Before you begin starting an accounting firm – or rather, any type of venture – it is important to do your research and understand the industry that you’re aiming to get into and the factors that impact it.

According to Bankwest’s Industry Review report on the accounting sector, more than 133,000 Australians are employed in accounting services. Between 2014 and 2015, the accounting services sector was responsible for generating $17 billion in revenue. These numbers reflect just how significant the accounting services plays in the professional services industry.

Many accounting businesses are located in major Australian cities. Bankwest has found the majority of these businesses to be based in New South Wales. While it’s easy to imagine that the majority of the firms in the accounting industry are large, smaller firms are the dominant. The ‘Big Four’ of the accounting industry only account for roughly 30% of the available market share (AFP Business Brokers). The profession can be separated into the ‘Big Four’, 2nd tier, mid-tier, medium sized and small accounting firms. There are many different markets that these firms cater to – meaning that there is plenty space in the market for the smaller firms to enter and compete in (AFP Business Brokers).

The important questions

Before you start an accounting company, ask yourself:

  • Do I have enough experience to help the needs of other businesses and individuals?
  • Do I have one year’s worth of capital to begin and operate for one year?
  • How will I differentiate what my accounting company has to offer from others in the market?

 Entering the market

Develop your Business Plan

Like every business venture, your accounting firm will need a business plan. Your business plan should cover the following areas:

  • Your goals for the business
  • Target market research
  • What services you offer
  • Your chosen business structure
  • Breakdown of costs and capital requirements
  • Marketing your business
  • Pricing strategy
  • Office location and requirements
  • Projected costs to start up, budget and revenue model
  • Insurance

Try it out part-time

If you’re still feeling some hesitancy before taking the plunge to break out on your own, consider picking up some clients part-time and see whether you enjoy working on a full-time basis and starting out on your own.

How about it, partner?

Two heads can be better than one. By finding the right partner or joining the right franchise, you can potentially have more service offerings, share costs and may appeal to a larger customer base.

Old issues, fresh start

One of the perks about starting out is that you aren’t beholden to any business legacy issues that may push down profits such as an old fee structure, old equipment and software or client service issues from the past. Make sure that you can market your services and price yourself accordingly. Brush up on the management of your marketing, pricing, selling and practice!

Know your software

Familiarise yourself with online accounting and bookkeeping software that is often used for small businesses, such as MYOB, Xero or QuickBooks. Cloud computing now offers accounting firms Software-as-a-Service (SaaS) solutions, allowing firms to be able to use flexible and extensive software applications that operate with strong data security at fixed rates.

Join industry and professional groups

If you are a member of any industry or professional groups, utilise them for information and support! If you aren’t a member of any of these groups, then sign up. Chartered Accountants in Australia and New Zealand (CAANZ) and CPA Australia are two of the world’s largest accounting bodies with a global membership and offers many core services to its members including education, training, technical support and advocacy.

Know the guidelines and legalities

Starting your business can be stressful but it can be even more stressful when you don’t know the guidelines and legalities around your business operations. There are many resources out there for new businesses to understand the requirements of practicing in Australia. CPA Australia has compiled a list of resources and information for public practices, including links to resources and support that the Australian Government offers as well.

Check out our Certificate IV of Accounting.

Unknown Famous Accountants


Unknown Famous Accountants

Accounting first began in Ancient Mesopotamia. Then accountants worked for temples, tracking taxes paid on sheep and agricultural produce. They used cuniform, a writing practice, to keep receipts. But, there have been many developments and accomplishments since then. Let’s take a look at some notable accountants that changed the game.

1. Mary Addison Hamilton

An Australian feminist, she was underestimated by her peers and surpassed expectations by received the highest mark on her exams and becoming the first female Chartered Public Accountant. She was offered a permanent position in the public sector, which is especially significant because in that time, women were not usually offered jobs in government. She worked as a clerk in the public service, using her skills to train new accountants and assist a number of charitable and not-for-profit organisations.

2. Josiah Wedgwood

If you recognise the name, that’s because he is in fact the founder of Josiah Wedgwood and Sons – the famous Wedgwood china. He created the first reliable system in the 1700’s to track bottom-line costs and profits, and tested it on his own company during economic downturn. His system proved so successful, it even brought to light an embezzlement scam run by his head clerk. Obviously good accounting is undeniably beneficial. Wedgwood is still around today, more successful than ever.

3. John Pierpont Morgan

He was an American financier and banker in the late 1800’s. He dominated corporate finance and industrial consolidation, directing the banking coalition that stopped the panic of 1907 and aiding the banking industry through the 1890’s. John’s global market leading financial services firm still carry’s his name, so successful, that is annually donates $200 million to non-profit organisations. His impact was so significant, that upon his death, the NY Stock Exchange stopped trading until midday.

4. Frank Mason Robinson

Frank started a business with associates called the Pemberton Chemical Company. They were playing with a medicinal formula using coca leaves and kola nuts… do you see where I’m going? Frank eventually coined the name Coca Cola, and even designed the logo written in Spencerian (the Accountants script of the time). So successful was their marketing that they were able to keep the same price of 5c from 1886 to 1959, which was approximately worth $1.20 including inflation.

5. William Welch Deloitte

Deloitte, also a founder of one of the Big 4 accounting firms, was an accountant from London. He began his own business sorting out bankruptcy at a young age. He also became the first independent auditor ever appointed at the Great Western Railway, and invented a system for railway accounts to protect investors from mismanagement of funds. In his time, he was also president of the Institute of Chartered Accountants in England and Wales. He retired a year before his death, as the oldest practicing accountant at the time.

Clearly, accountants have a lot to offer the world, including Bubble Gum (look up Walter Diemer) and Phil Knight – the co-founder of Nike. You never know where an accounting career will lead. Linden offers a Certificate IV in Accounting (FNS40615)… just saying.

The Accounting Industry: What it’s like.


The Accounting Industry

There’s been talk that the accounting industry might be declining thanks to technological advancements. But this is simply not true. Accounting has too many complexities and intricacies for a machine. Most individuals and every company in every industry needs an accountant.

There are many different types of accountants, and many different area to work in. Some examples include – accounts administrators, reconciliation clerks, accounts payable, accounts receivable, bookkeepers and SMSF administrators.

Then there are accountants who work in accounting practices. These accountants have roles  such as – auditing (who examine company’s financial statements), management accounting, taxation advising or business services. Business services accountants work across all areas of accounting consulting to small business and individuals.

Some accountants are consultants, who help businesses with their decision making, or in specialist tax areas, like film production. Other accounting roles include forensic accounting – which involves fraud prevention and detection; cost accountants, project accountants, as well as analysts.

There are unique areas like environmental accounting, which involves analysing the environmental impacts of business such as the financial damage from ecological disasters.

Do you have a particular interest in an area outside of accounting?  You could combine your passion with work as an accountant within areas – such as a sports or music company. There are also industry specialisations, such as SMSF accountants and Real Estate Trust Accountants.

What Do Accountants Do?

The accounting industry is diverse. Accountants prepare reports, analyse, and assess on many various financial or tax items, which yes, does include tax returns. They also interpret and apply regulation, as well as keep up with ever-changing legislation. A good accountant is adaptable, diligent, committed and detail-orientated. Some accounting positions can be stressful, with tight deadlines. Mostly, accountants also need to be affable, as they work with people.

From our CEO – What do you like most about the accounting industry?

The most interesting thing about the accounting industry is the people you meet. Definitely, its the people, you meet new clients and catch up with old clients. You learn about their life, their family, their business, their investments, their goals and objectives.

Then it’s the problem solving. How can I help this person meet their goals and objectives, how can I help them save on their taxes, is their business tracking well?

Knowing that you can’t please everyone all of the time is important. Knowing that you are helping your clients and getting positive feedback is the ultimate goal for any accountant.

To move up in the accounting ranks;

You can begin an accounting career with a Certificate IV in Accounting and develop the skills and knowledge to move ahead. With a Certificate IV in Accounting your career will commence with jobs such as an accounts clerk, payroll clerk, accounts clerk, bookkeeper or assistant accountant.

Starting with a Certificate IV in Accounting is also a great way to springboard into university with a little prior knowledge. There are many professional associations in Australia including the Australian Bookkeepers Network, Association of Accounting Technicians, and the National Tax and Accountants’ Association.

If you would like to find out more about our Certificate IV in Accounting phone us on 1300 228 338 or complete the contact form and one of our staff will respond to you as soon as possible.

 

Accounting Career Under the Microscope


If you are considering or starting an accounting career? Then you will need to understand the accounting career pathways. In this article, we explain some accounting career choices by putting Accounting Career Under the Microscope.

What is an accountant

If you think accountants are only boring, bean counters or poor old pencil pushers sitting alone at in a small cubicles, then you’d be mistaken. Accounting is a fairly social profession with many different streams.

OK, perhaps being an accountant isn’t always social. It is a serious job. Then again, no job is completely social. Let’s think about it for a moment. Because, in today’s world we network, use social media and go to meetups, no accountant is going to hide in a cubicle.

So just where do accountants work?

There are so many different streams of accountants. We thought it best to start with where accountants work. With so many streams to choose from, people with accounting careers in accounting practices, business, industry, government, education and IT.

Personal characteristics

If you are considering an accounting career, then you may possess:

  • a need to learn new things
  • embrace technology and innovation
  • outstanding work ethics
  • leadership potential

Which qualification is best for me?

This is a not as straight forward as you might believe. The following table matches the qualification to a job role. You can use this table as a guide to choose your course.

Certificate III Certificate IV Diploma Advanced Diploma
Accounts Clerk

Payroll and Accounts Clerk

 

Accounting Support Officer

Bookkeeper

 

Assistant Accountant

 

Accountant

Tax Agent

 

What is the accounting career outlook?

The job outlook to 2020 appears good for those considering an accounting career. According to myskills.gov.au, the demand for accountants, with a Certificate IV in Accounting is above average. The demand for accountants with a Diploma in Accounting or an Advanced Diploma in Accounting is high.

 

You can become an SMSF Accountant!


Being an SMSF Accountant

SMSF stands for Self Managed Superannuation Fund, which is a type of superannuation fund run by the members for themselves.

Being an SMSF Accountant involves more than just counting the money and preparing reports. SMSF accountants learn quite a lot about the SMSF law, SMSF Tax, investments and retirement planning. Being an SMSF accountant involves dealing with a number of other professionals which may include: a financial planner, a registered SMSF auditor, a lawyer, a registered valuer, or actuary. Who the SMSF accountant deals with each year will  depend on the transactions in the fund.

SMSF Accounting services

SMSF Accountants prepare the superannuation fund’s financial statements, typically using specialist accounting software such as BGL or Class.

The financial report must be prepared with knowledge of the Australian Accounting Standard. The standard applicable to superannuation funds is AAS25: Financial Reporting by. Superannuation Plans. Although an SMSF, is not a reporting entity, and only needs to comply with the section relating to asset valuations at market.

The SMSF accountant also prepares relevant minutes, members’ statements and the Annual Tax Return.

Often this is completed once-in-the-year, however with the advent of online SMSF accounting software, it is now easier to be a pro-active accountant and prepare the financials on a more regular basis. This could be daily, weekly, monthly or quarterly depending on the size of the SMSF and the trustees needs. 

Caution

SMSF advisers, including accountants must understand ASIC regulation RG146. Because an SMSF is a financial product, an SMSF accountant is limited to providing only accounting and taxation services. Note: the SMSF Accountant cannot make any recommendations on the investment process, although there are exceptions.

Benefits of becoming an SMSF Accountant

Being an SMSF Accounting is an interesting and rewarding career choice. You get to understand a lot about the various investments and deal with different professionals than you would normally.

 How to become an SMSF Accountant

Linden College offers a specialist stream of FNS40615: Certificate IV in Accounting (SMSF). To find out more, contact the college on 1300 228 338 or email study@lindencollege.edu.au. Click here to find out more about our FNS40615: Certificate IV in Accounting (SMSF)