Clients regard their CPA as their “most trusted advisor” because they believe their accountant has an objective perspective on the financial world. However, less than five percent of affluent investors who utilize financial planning advice say they seek this advice from their accountants, according to a recent research draft from Prince & Associates.

Each year accounting professionals look to increase annual revenues without working more hours. To do this, leading firms are seeking to attract higher-value clients by offering access to additional financial services. These premium services are supporting increased billing rates by drawing higher-value clients who appreciate the immediate access to additional expertise.

But first, remember that although accounting firms deliver tax and accounting-related services, more importantly they offer objectivity, independence and confidentiality.

Accounting firms have spent decades building businesses on these values, and they strive to maintain control of the client relationship in order to protect the integrity of these values. Continuing to do so is important; and within these parameters delivering non-traditional financial services for compensation is possible.

Benefits of a Team
Most clients retain relationships with several unassociated advisors to address diverse needs. Each advisor maintains a level of objectivity; however, a significant cost is incurred as the clients remunerate each professional individually and use their own time to integrate the counsel of each.

Assimilating the efforts of clients’ multiple advisors to deliver comprehensive financial advice from a team of trusted professionals would provide clients with consistent guidance, at a lesser cost. Seeing these potential benefits, professional advisors from various specialties have recently integrated their work through alliances.

The main difficulties have been the professional advisors’ loss of objectivity and independence. However, when the team is built correctly, these values are prioritized, not sacrificed.

Building a Team
For example, an accounting firm in California built an alliance with a trusted group of wealth management professionals in order to provide clients with additional services such as financial planning, estate planning, retirement planning, investment advice and insurance services. The wealth management firm has built a tradition of offering these services on a fee-based platform.

The alliance is built to uphold each firm’s objectivity, independence and confidentiality. When any of the professionals introduce a client to the team, that professional retains full control of the client relationship. If an accountant introduces a client to an investment advisor for retirement planning, the accountant has the right to advise the client to fire the investment advisor at any time. This structure brings the highest level of accountability to the alliance.

Client needs are fully analyzed to reveal goals, objectives, risk tolerance, time horizon and tax sensitivity. Then, as work is accomplished and advice is given, the professional who originally introduced the client has access to as much information as desired. Again, this leaves control of the client relationship in the hands of the originating advisor.

Valuing the Team
To maintain the independence of each firm, separate firm names are still employed. To enhance the synergy of the alliance, the relationship is stimulated by a revenue-sharing agreement. With proper licensing, each advisor participates in the revenues generated by the advice that is given. Each advisor takes responsibility for providing and supporting suitable advice in his/her area of expertise. Ongoing client service is accomplished through quarterly review appointments, periodic newsletters and birthday cards/calls. 

In summary, the clients of both firms gain comprehensive advice from trusted professionals representing several areas of expertise. Although it requires forethought and planning, clients receive a consistent look at their overall needs, adding significant value to their financial lives. And because of its flexible structure, an alliance allows each firm to grow within its unique business model.

About the Author
Chris McCarty holds a degree in business/accounting from The Master’s College and is a financial advisor with Cirrus Wealth Management. He can be reached at 800.550.1095 ext. 114 or at cmccarty@cirruswealth.com.

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