By now, you’ve most likely heard of CAS, CAAS, advisory accounting, accounting and advisory companies—or no matter you need to name it! This development within the accounting trade transitions to a give attention to advisory accounting companies fairly than a compliance-heavy service. However, what precisely is it? We’ll break it down for you right here.
What’s CAS Accounting?
First, let’s get our acronyms straight. There may be nonetheless debate within the accounting neighborhood about whether or not or not this mannequin known as CAS (Shopper Accounting Companies) or CAAS, with the additional A representing “advisory.” For our functions, we’ll confer with this mannequin as CAS accounting.
Now that we all know what to name it, let’s study what it’s! Traditionally, accounting companies have been centered on the compliance facet of issues. Extra lately, companies have been adopting a special mannequin of enterprise with CAS. In line with the CPA.com & AICPA PCPS 2018 CAS Benchmark Survey Report, the 5 commonest consumer accounting advisory companies provided are: monetary assertion prep, accounts payable, CFO/controller advisor companies, budgeting/forecasting, and payroll companies.
As an alternative of specializing in simply the nitty gritty i.e., taxes, transactions, and issues which have already occurred, CAS companies additionally give attention to the long run and attempt to assist their purchasers keep proactive and make one of the best choices for his or her enterprise holistically. Consider the compliance facet and the advisory facet as complimentary companies that go effectively collectively. Compliance is the cake, and advisory companies are the icing on high.
As an alternative of continually hounding your purchasers for the suitable paperwork, the work turns into extra of a partnership and the accountant is seen as a part of the enterprise’ workforce. Accounting companies trying to undertake advisory companies into their technique don’t want to dump their compliance purchasers—these purchasers are nonetheless nice and it’s OK to have each advisory purchasers and compliance purchasers.
When CAS companies are in search of new purchasers, it’s necessary to ask “How can our companies assist you on the compliance facet AND the advisory facet?” Relatively than ensuring the tax return is solely turned in on time, CAS companies ask themselves “Can we have a look at this tax return and truly add additional worth and perspective?”
Discovering a distinct segment consumer base could be useful when adopting a CAS mannequin, because it permits you to present extra service to your purchasers, contemplating you’ll shortly develop into well-connected in that area of interest market and be capable of present skilled recommendation.
CAS companies are about altering the narrative about accounting—you’re now not promoting your time, you’re promoting your data and experience. That’s why CAS companies sometimes invoice their purchasers upfront with a subscription, or value-based pricing mannequin, and description precisely what companies their purchasers will probably be receiving. This permits the accounting agency to have 12 months spherical money circulation and receives a commission earlier than the work is completed. For the consumer, there’s no hidden charges, the communication is obvious and the connection is ready to evolve to a partnership between the consumer and the accounting workforce.
In line with the CAS Benchmark Survey, CAS accounting companies are rising at double the 5% median CPA agency progress price reported by the 2018 AICPA PCPS and CPA.com Administration of an Accounting Apply (MAP) agency benchmarking research. With the advantages of providing Shopper Advisory Companies to each the accounting agency and the consumer, it is smart that the trade is seeing a rise in a majority of these companies.
If you happen to’re trying to keep forward of the competitors (and sustain with the trade) it could be time to begin contemplating adopting advisory companies to your accounting agency. Does your agency provide CAS? Tell us within the feedback beneath.