Sunday, 12 August 2018

$405,000 worth of new accounting fees - With NO Marketing and NO New Clients?

I just finished running my 1-Day Intensive Workshop "How to Build a Value-Based Accounting Firm" with a great accounting firm on the Gold Coast. One outcome (of many) was their first project that will create at least $405,000 worth of new accounting fees straight away from existing clients with ZERO spent on marketing etc.  This is the picture of the whiteboard from the afternoon session of my workshop and there, slap bang in the middle is the "conservative" amount in red that I wrote that this project will generate in fees for them. 

Imagine what I could do for your accounting firm?

It's my favourite session of the day and it's called "Fees from Thin Air."  It's amazing when I see the eyes light-up of the partners in the room when I show them how literally they can create fees from thin air. 

Here’s how you know if you need to undertake my workshop:
  • You have write-offs of 10% to 20%, or even more and having at least 20% write-ups on every job appeals to you.
  • You feel that your Work-In-Progress and debtors is too high and you spend a fair chunk of your day (or someone on your staff does) on the phone either arguing with clients justifying your fees, writing off WIP, carrying it forward hoping to recover it in the future or chasing clients to pay you.
  • Having thousands of dollars in new fees with minimal work to generate them is something that you want.
  • Some of your clients are telling you that you are too expensive and some even  say that they can get their work done cheaper somewhere else and therefore they pressure you to reduce your fees.
  • Some clients don’t see the value in what they pay to you and you hear the statement: “My fees should be reducing every year.  Surely your staff know my work by now and should be doing it faster each year?”
  • You currently waste time and money trying to get new clients, spending thousands of dollars on marketing campaigns that deliver poor results, social media posts that no-one reads or finds interesting, search-engine optimisation that makes the SEO company money not you.   
  • Cash flow at times is a struggle for your firm and being paid 100% upfront by all your clients would make your life so much better.
  • Clients don’t value what you do and you have to constantly battle with them to prove your worth.
  • You truly love the business you’re creating and are passionate about seeing it succeed–in other words, you’re in this for the long haul. BUT you want someone to lend you a helping hand who has been there and has done this and who can show you an easier way to grow your firm.
If you answered yes to any of these, here’s the first thing I want you to do: Call or email me for a no-obligation meeting to see if I can help you build the vision you've always had for your accounting firm.

Sunday, 29 July 2018

How to Create Accounting Fees From Thin Air - And Have Your Clients Rave How Valuable You Are!

How to get fees from THIN AIR! It's not a typo. I have a segment in my 1-Day Intensive "How to Build a Valued-Based Accounting Firm" actually called "Fees From Thin Air." It is my favorite segment and by the end of it every skeptical, disbelieving, cynical person in the room is in awe of how to do it. If you don't think it works, I show my attendees the actual proof. Here are some recent examples of clients signing off and paying 100% upfront and the time it took from when the fee estimate was first emailed to when it came back signed to proceed. AND these clients all raved about how valuable the work was compared to their old accountant:
- New Client - signed off $4,000 in 13 minutes
- New Client - signed off $6,000 in 20 minutes
These were NEW clients, I haven't even started their annual compliance work, which BTW they signed off in similar times at an average of 3-4 times what they paid their previous accountant in fees. The only thing I did WAS DEMONSTRATE THE VALUE in each proposal. Each proposal took about 1 hour to draft and the value was huge. Why else would they sign off so quickly? I certainly wasn't holding a gun to their head. The work above resulted in an Average Hourly Rate of at least $1,000 per job with admin staff doing most (if not all) of the actual work by following my simple proposal. This is no bull. I have the reports to show you.
Everyday accountants don't value what they do for their clients (new and existing) and don't see the tens of thousands of dollars of new fees right in front of their faces. Not a single $$$ was spent on marketing for these new fees BTW.
Maybe you should allow me to run my 1-Day Intensive workshop for your firm, in-house, in private, just for you and your staff. It will give you an unfair advantage over your competitors. Message me to find out more. What do you have to lose? Maybe just a lot of untapped professional fees!

Friday, 20 July 2018

For God's Sake! - Stop Doing This!

"We specialize in a range of services designed to assist our clients to meet their taxation and compliance obligations, whilst assisting them to achieve their business and personal goals. We have highly skilled and experienced staff who are committed to helping our valued clients grow their wealth whilst providing a holistic tax and accounting experience."

For God's sake will accountants STOP putting such boring, trite dribble on their websites and on their marketing brochures. IT IS PUTTING POTENTIAL CLIENT'S TO SLEEP! And it also sounds like every other dribble I see on nearly every accountants website. They ALL look the same. 

As you guessed from my tone, it makes me mad when I see so many examples like the one I just pulled off an accountants website this morning. It hardly gets me excited when I read it and it makes me want to tear my hair out.

If you want to build a Value-Based Accounting Firm then please, please stop writing such dribble like this. Write this instead:

"We just saved our client Chris $113,000 in tax that his other accountant couldn't. Now he's taking his family to Disneyland for the holidays.

Imagine what we could do for you..."

Now here's a few tips for you:

  • Make sure you do have a real life example testimonial from a client. A good-news story. Change the names if you have to but get their permission to use it.
  • Make sure you quantify it. Don't just have Chris your client saying how good your firm is. As if no accounting firm already says this on their website? Good at what? What did you actually do that improved Chris's life? Be specific, invoke an emotional response.
  • Put it front and center on your website. Big and bold and make it the first thing a potential client sees. Don't bury it halfway down the page or behind another tab.
  • Make it the basis of all your marketing, front and center. People will remember it like, "Yeah, I've heard of those accountants. They helped one of their clients take the family to Disneyland." I don't know about you but I'd like to be known as the accountant who did that rather than "Yeah, we do tax returns, GST, accounting, blah, blah, blah."
  • Believe or not, people don't care that you have the best, most highly skilled staff. It's a given. Even if you don't, are you really going to say you don't? People want to know what tangible results you have achieved and what you can do for them. I have run rings around "the best, most highly-skilled staff" who couldn't see a better outcome for the client if they fell over it.
  • Everyone has a range of services, the best staff, dedication, works hard, values their clients (well maybe not everyone) does tax and accounting work, helps their clients. So say something else otherwise you will look like everyone else.
  • Stop using words like "compliance" and "obligation". It all sound very "big stick" and unemotional like you work for the Taxation Office. I want to feel excited and emotionally moved not frightened when I read your message.
So please, please take some of these suggestions on board. If you aren't getting enough website inquiry then maybe look at what you have written on your website and marketing material and wonder why it looks like every other accountant's marketing: the same!

End of my rant. 

Thursday, 28 June 2018

You are Worth More

How does your firm stack-up? - To grow your accounting firm starting 1st July may be as simple as lifting your own expectations.

A partner in a firm the other day asked me: "What level do I lift my Average Hourly Rate to? Matthew what rate do I set?"

It's as simple as deciding where you want your firm to be (not your clients nor your staff deciding for you) compared to those in your industry. Above is a snapshot of Performance KPIs for a range of accounting firms. Take a look now.

  • If you want to be a "high-performing" firm as is in the Upper Quartile, then set your AHR at a minimum of $231, across ALL jobs.
  • If you want to be just "Average" then set it at around $200 or less.
  • If you want to to have a poor performing accounting firm then set it below $170 per hour.
The choice is yours to make not mine. (That's what I told the partner of the accounting firm).

It's funny as accountants we preach to our clients such things like "Business Improvement", "Profit Performance" and "Growing owners return" and yet in our own accounting business it's almost forgotten. Hardly a living example are we? We tell our clients to make money, to maximise returns  and "cash-flow is king" yet I know a lot of accountants with their own firms who are still sitting in the "Worst Results" column on the above chart. 

So here's a few questions for you: 

  1. Where do you sit on this chart? 
  2. What targets are you going to set yourself and your accounting firm starting now?
  3. Will you settle for anything less than you are capable of?

I assume you have studied accounting. I assume it wasn't easy working two jobs while you got through Uni (I had 3 jobs to pay my own way). I assume you still study now by keeping up-to-date with all the tax law changes etc. I assume you have a lot invested in your business, have loans, a mortgage and are good at what you do. I assume you eventually want to sell your share in the business for a lot (CGT Tax Free don't forget) and have a great retirement.

You are worth more. You have immense value. You are the expert. Charge accordingly.

BTW - I help Partners, Owners and Directors of accounting firms painlessly lift their firm-wide Average Hourly Rate. 

Thursday, 21 June 2018

How to lift your fees by 26%

How to lift your fees by 26% - Ditch your multiple charge-rates if you want to grow your accounting firm starting 1st July.

I did this in 2012 in my firm and never looked back. My fees grew by 26% in less than 12 months with Zero marketing spend.
If you really want to lift the performance of your accounting firm, then make a new "financial year's" resolution to stop using multiple charge-out rates for your staff. It is cumbersome and inefficient. The bigger your firm is the more charge out rates you have to track and then increase for a particular staff member when you do pay reviews. It's crazy!
A simpler, more efficient and certainly more productive approach is to ditch your multiple charge-out rates and simply implement a firm-wide Target Average Hourly Rate (TAHR). This is the Target AHR you want and set from the 1st July for ALL compliance work that comes in to your firm. Therefore each year, all you have to do, is to be ambitious enough and increase the TAHR and your fees will grow automatically.
For Example: Recently one of the accounting firms that I am working with were horrified to discover that for the entire financial year, their firm wide AHR recovered for professional staff was $53 per hour! That's insane! Where's the ROI on your investment, your risk, your blood, sweat and tears! And there's a lot of tears (and blood spilt) in running an accounting firm as you very well know.
The quickest way to increase your firm's fees is to simply set a target rate that must include all staff, including Admin. Therefore you need to increase your target TAHR slightly more than what you would expect to take into account your Admin Staff who may not charge their time. Personally I believe all Admin Staff you charge their time. But that is an argument for another day.
This is how you do it:
  1. Ditch all individual charge rates in your firm.
  2. Still complete time sheets, however the charge rate for everyone is $1.
  3. Prepare your fee estimates based on the number of hours to complete the job with some buffer for overruns.
  4. Always monitor daily the hours left on ALL the jobs and always adjust for scope creep and scope seep.
  5. Set your fee budgets based on hours multiplied by your Target Average Hourly Rate regardless who is working on the job. For example: An accounting job comes in and you budget 20 hours from start to finish including Admin time to log in the job and mailing it out. If you set a target AHR of $230 per hour, then the fee budget is $4,600 plus GST.
  6. High-end business advisory work should be charged at an even larger TAHR. Therefore at the most you may only have two target AHRs in your entire firm. How simple is that?
You can lift your fees across the board in 2019 without spending $1 on marketing and without acquiring one new client. Just simply set a Target AHR for the entire firm and price everything accordingly.

Sunday, 25 March 2018

5 Huge Tax Savings From Having Your Own Super Fund


I was speaking to a client last week who was telling me that their superannuation was going no where and they wanted to buy an investment property as part of their retirement savings plan. They didn't want to negatively gear the property and wanted it to be cash-flow positive from the start. They also said it was a long-term plan of theirs to have maybe 2 or 3 properties in the next 10-15 years in a property portfolio. BUT here's the problem. They don't want to pay any tax on their rental income or capital gain on the property or risk the property if something happens to the business or they get personally sued etc. 

"Perfect!" I said. They looked at me blankly. "We can do all that if you buy the property in your own superfund." 

"What do you mean Matthew? Are you kidding me? The government taxes us so much now. If we buy a property it's just going to add to our tax woes."

"Let me show you the 5 huge tax savings from having your own Self-Managed Superannuation Fund," I said to them.

It goes like this:

  1. Super Fund net earnings are taxed at only 15% compared to as much as 47% on your personal earnings. So if you have the property in your name, rather than in an SMSF, you could be paying as much as triple the tax on the net rental income from that property. No brainer.
  2. You get a tax deduction for paying down the property loan. When you make a contribution into your super fund, you get a tax deduction. Now superfunds pay tax at 15% on contributions. But if you are say in the 30% plus tax bracket, you are still saving a net of 15% in overall tax. So the funds that go into your superfund you get a tax deduction for AND can be used to pay down the property loan. How good is that?
  3. When you go to sell the property and you haven't yet retired (still in accumulation phase they call it), the capital gain is reduced to just 10%. That's right.  A superfund only pays 10% capital gains tax if you hold the asset for more than 12 months. Now since the client said they wanted to hold the 

Monday, 26 February 2018

How to buy THE RIGHT PROPERTY for your Super Fund

The Four Philosophies to Rapidly Growing your SMSF

I have seen so many clients purchase the right property in their super fund and so many purchase the wrong property in their super fund. I'm going to tell you the secret of how you buy the best property for your super fund. If you get it right, then your retirement funds will soar and you can look forward to a happy and secure retirement. BUT if you get it wrong, it's not too late to fix it so you can correct the problems and grow your super. 

Each week for the next 4 weeks I will be sharing with you how to do this. All this and more valuable information is in my book, The Collapse of SMSFs..   ⇐Click on the link to read more.

So keep reading and keep learning. The best investment you can EVER make is in your own knowledge.

I have created four philosophies for rapidly growing your SMSF. These philosophies are not based on academic theory nor on copying ideas out of an investment textbook or magazine. These four philosophies I have created are based on more than 20 years’ experience that I have had in helping business owners and investors in my accounting practice. In those 20-plus years, I have observed, helped, and seen the best and worst of what my clients have done well and what they have done poorly in terms of investing and in managing their superannuation. I’ve taken this vast amount of first-hand knowledge and experience and have condensed it into what I call the Four Philosophies.

Whenever one of my clients lost money or made money, whether it be in their superannuation, in shares or property, or in sophisticated investments, I have taken intricate and detailed notes on what they did and exactly how they did it. From being involved in hundreds of client meetings, reviewing truck-loads of investment transactions they have done, and scouring thousands of pages of detailed notes, work-papers, and records that I have taken, made, and analysed, I have found four common strategies that exist in nearly all of their investment decisions. Clients following these four strategies or philosophies have made significant investment gains where others have failed. I have boiled down this accumulation of knowledge into a concentrated source that I am going to share with you called the Four Philosophies for rapidly growing your SMSF.

These four philosophies should be the bedrock that surrounds, protects and grows your retirement fortress. They must form the basis of every investment decision that you make when managing your retirement savings. They must become the DNA upon which you grow and protect your retirement savings.

I have collated and curated 20 years of real-life financial records to support and prove time and time again that these work. How? Because I’ve seen the actual results and financial gains these people have made when following these philosophies. I have the records to prove it.

Whether or not your retirement years will be the “time of your life,” or you spend them watching every penny, sacrificing your lifestyle or not being able to pay the rent depends on you deciding to make a commitment right now to follow these four philosophies. A life of backward reflection is about having no regrets.

The Four Philosophies are:

Philosophy #1 – Live and breathe the seven laws
Philosophy #2 – Losing money is unacceptable
Philosophy #3 – Only invest in High Probability Events (HPE)
Philosophy #4 – Timing isn’t everything – It’s the only thing

If you graft the DNA of these four philosophies into your living and breathing retirement plan then you will have a bountiful, independent, and secure retirement lifestyle.

Philosophy #1 – Live and Breathe the seven Laws

You need to set yourself up for success by reading, practicing and adopting the seven laws we have already covered in this book. Living and breathing the seven laws will set you up for success. The seven laws are all driven by one outcome: helping you not to lose money. Nearly every person that I know who has a self-managed superannuation fund or retirement fund has lost money at some point simply because they didn’t practice consistently and totally any of the seven laws. The loss of money could have simply been avoided in 100% of the cases. This is no exaggeration. If they had simply lived and breathed the seven laws they would have made, not lost money. Here are some real-life examples:

·         I have seen people lose money by purchasing a dud SMSF property because they didn’t do their due diligence well. They paid over $100,000 more for a holiday apartment than what it was really worth.

·         I have seen people lose up to 60% of their retirement savings when the GFC hit, because they didn’t “Go Back to School” and fully understand the patterns in the stock market and in the global financial system.

·         I have seen people lose money in their stock portfolios because they didn’t see the hidden clues in following how the stock market moves in relation to interest rates and inflation.

·         I have seen people lose money because they simply trusted implicitly and completely what they had been told by dubious and charlatan financial planners and so-called investment advisors.

·         I have seen people lose money because they had no “Plan B” for how to rescue their retirement savings, savings that could have been quickly and easily salvaged if they had had alternate strategies ready to be implemented.

·         I have seen people lose money because, whilst they had built up a strong retirement fortress initially, through subsequent neglect and apathy and the typical “she’ll be right mate” attitude, they then neglected to adopt a siege mentality and, as a result, their once-solid investment portfolio fell out of favour and plunged in value.

·         I know clients who have blindly followed the advice of investment advisors and bought property in 2010 in low socio-economic areas such as Buffalo and Detroit in America, trying to capitalise on the eventual upswing of the US property market after the GFC. Some of these properties have only been rented for six months of the year or were turned into crack houses. The police seem to spend more time there than the tenants.

·         I know people who have answered an advertisement in a newspaper to buy property in the US, and then they ended up having to pay tens of thousands of dollars in property back-taxes from the previous default owner.

·         I know clients who have bought multiple properties in regional mining areas, paying inflated prices for houses, believing that the growth in the Seurat Basin would be the answer to all their financial woes and would make them instant millionaires. Three years later these properties are now worth less than 50% of what they purchased them for!

Case Study – Friday, 22nd May 2015 – Scott and Julie

I stared disbelieving at Scott when he told me. I could not believe what he had just said.

In his managed fund he had $90,000 invested and for the last three years it had not grown at all. For three years it had gone nowhere! Yet Scott had admitted he knew this fact. Every three months for the last three years he received his quarterly fund statements in the mail, read them and then did nothing about them. He didn’t care.

That’s three years wasted in building his retirement fund. With inflation, he was in fact losing money.

The overarching secret to rapidly growing your retirement fund is to first implement all of the seven laws you have learnt to date, because:

1.     If you don’t have a distrusting mindset, and trust all the advice that you are given by family, friends and investment experts, then you will lose money.

2.     If you are not willing to go back to school and constantly expand your knowledge and develop your financial intelligence, then you will lose money.

3.     If you don’t choose to build a retirement fortress by having a solid trust deed, and review and update that trust deed on a regular basis, then you will lose money.

4.     If you don’t thoroughly review and research every investment proposal that you are presented with, before you invest your valuable retirement savings, then you will lose money.

5.     If you take as gospel what a property spruiker tells you, that this property that they have found for you is a “sure thing” and you will make lots of money, without first doing your property due diligence, then you will lose money.

6.     If you don’t have a Plan B for when your shares drop in value, or you cannot get tenants for your rental property, or the real estate bubble bursts, then you will lose more money.

I have seen time and time again over the last 20 years the exact same scenarios that I have described above. All of these, without exception, could have been avoided if people had simply followed my seven laws. There is no magic formula. There is no secret share-trading algorithm. There is no hidden backroom where the best investors swap the holy grail of moneymaking commandments. Just live and breathe the seven laws and you will not lose money. It’s as simple as that.

The instances where I did lose money myself in my superannuation or in investing in general I can pin down 100% of the time to myself not following my own seven laws. Did I make mistakes? Yes I did. Do I regret what I have done? Absolutely. We are only human. I too have lost money. I can simply say that in 100% of the cases where I lost money, I did not follow all of my own seven laws.

Those who have made money and whose retirement savings have grown in leaps and bounds followed the seven laws in one form or another, and it has paid dividends for them. They now have an exciting, rich and rewarding retirement life and can live and do what they want, when they want. Will this be you?

Case Study – Dan & Mary: Lessons Learnt in Building a Watertight Business

Dan and Mary had built a strong and profitable waterproofing business that had multiple offices throughout the State.

Business profits were ploughed into investment properties in Brisbane and Ipswich, an outer-lying suburb 30 kilometres west of Brisbane. Prior to the GFC in 2008, things were going well. Dan was getting plenty of waterproofing work from builders, and there was a construction boom happening in South East Queensland. The business phones rang hot, and their bank account grew as a result. With the growth came more staff, more debt, and more stress.

They had built a very strong retirement fortress with their SMSF; however, they didn’t see the warning signs that were looming on the property and construction horizon. Dan had invested in non-traditional assets in his super fund, including works of art, rare bank notes, and speculative mining shares. The demand for such specialised investments could fluctuate immensely.

Whilst Dan had done some initial research and had “gone back to school” by attending a few investment seminars and subscribing to a few investment newsletters, he was only doing the bare minimum and not really mastering the fundamentals of investing.

He followed what “celebrity” investment experts in the media were telling him to invest in without doing too much actual due diligence himself. However the warning signs were coming loud and clear and the writing was on the wall:

1.         They had bought an investment apartment in an oversupplied apartment market in Ipswich (Go Back to School & Master Your Due Diligence);

2.         They continued to aggressively expand their operations in North Queensland, believing that the mining boom would continue and that the surge in new house construction close to regional mining sites would increase (Create a Plan B);

3.         They trusted that many of their business customers would eventually pay them. A few large builders and developers in particular had promised to pay their accounts even though after six months, Dan and Mary had not seen one cent from these customers. They simply trusted them too much (Trust No-one & Develop a Siege Mentality).

4.         They invested in speculative, overpriced works of art for their SMSF based on unsubstantiated advice from an art dealer that specialises in selling corporate art to investors to then lease them back to their corporate clients to hang in their boardrooms. This art-dealer had a sweet deal; he would get a cut of the sale price from the artist for selling their paintings, he would then charge the purchaser of the painting (in this case Dan and Mary) a buyer’s fee, and he then took a margin on the lease payments for leasing the painting to a corporate client! (All seven laws ignored by Dan and Mary, but followed by the art dealer).

5.         There was a looming construction downturn (Create a Plan B);

A pattern was emerging that whilst Dan and Mary were ploughing headlong to expand their business as well as investing in their SMSF, they didn’t follow all the seven laws.
When cracks started to appear in their retirement fortress, they chose to ignore them until the cracks became huge. By then, it was too late. The leaks eventually became a flood, and the business went downhill. Dan and Mary had to sell their properties at fire-sale prices and dump the artwork, bank-notes and speculative mining shares in their SMSF at grossly discounted prices.

I remember clearly them coming into my office one day. I was very direct in my words as to the looming downturn in the mining industry and what effect this would have on the construction industry and on their business. I was also concerned about the specialised nature of the investments in their superannuation fund and how easily their market value could fall. I know when an economy tightens up and spending slows down, exotic investments and discretionary spending is the first to go. At the corporate end of town, fancy pieces of abstract art get sold or returned to the leasing company. This is exactly what happened a few months later. Unfortunately Dan and Mary chose to ignore my advice. To my surprise, they were quite angry that I had contradicted their once successful investment philosophy.

A few months later, I ran into Mary at the post office collecting her mail, and she looked haggard and stressed out. Two of their paintings had been returned to them. The corporate client who had rented the artwork was cutting head-office costs, so they had cancelled the lease. The art dealer could not place the paintings with another corporate client, as they were all looking to reduce their own business expenses. Apparently leasing a painting that looked like a child had painted it wasn’t an essential business expense. The paintings were then wrapped and placed into storage and have not earned any income for their SMSF for over 12 months.

Their other investments had done worse and, in fact, Dan and Mary had lost a lot of money on the share market. Other collectors of bank notes, feeling the cash-flow squeeze, dumped their collection on the market, causing a glut. Consequently, prices fell and Dan and Mary’s collection halved in value in a matter of months. Their operations in North Queensland dwindled on the back of the downturn in the mining and resources boom, and their business suffered as well as their retirement savings.

Live and breathe the seven laws I have given you. When things are going well and your shares, property and other investments are growing, pay even more attention to these seven laws. I have designed these laws to help you to NOT lose money. They are based on more than 20 years of dealing with people exactly like Dan and Mary. Turn your back on these laws or bury them in the dark recesses of your memory and you will lose money, eventually.

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