Accountants and bookkeepers have been told for years that they need to offer financial advisory services. What they haven’t always been told is how to provide those services well.
Artificial intelligence and accounting technology are quickly taking over many of the repetitive tasks that once filled the workday. That makes trust, judgment, financial insight, and meaningful client conversations more valuable than ever.
In this episode, I begin a new series based on more than 30 years of experience providing financial advisory services. We’ll look at why advisory services matter, how they can strengthen client relationships, and why moving away from hourly billing may be an important part of the transition.
Why Financial Advisory Services and Value Pricing Matter
The Accounting Profession Is Being Disrupted
Technology is changing accounting whether we’re ready for it or not.
Artificial intelligence, large language models, and newer accounting platforms can already complete many repetitive tasks faster than people can. These tools can assist with transaction categorization, bookkeeping, reconciliations, reporting, and other parts of the accounting process.
Human oversight is still necessary. Someone must verify the work, apply judgment, recognize unusual circumstances, and make sure the information is accurate.
But clients are unlikely to continue paying the same rates for routine tasks when they know technology is doing much of the work.
That leaves accounting professionals with an important decision. They can continue providing services the same way they always have, or they can begin offering more valuable guidance through financial advisory services.
Clients Want More Than an Annual Conversation
I recently taught a class where a business owner said he spoke with his accountant only once a year. He wasn’t happy about it.
That comment wasn’t prompted. He brought it up because it was affecting how he viewed the relationship.
Many business owners want more communication and a better understanding of what’s happening financially throughout the year. Reviewing financial statements every month creates a natural opportunity to have those conversations.
That is the foundation of financial advisory services.
Instead of simply preparing reports, you help the client understand:
- What is happening in the business
- Why financial results are changing
- Which trends deserve attention
- Where potential problems may be developing
- What actions the owner should consider next
These conversations help clients make better decisions and build a much stronger relationship with their accountant.
Advisory Services Require a Different Mindset
Providing financial advisory services may require you to step outside your comfort zone.
The fundamentals of accounting have remained largely unchanged for centuries. Many firms have also followed the same service and billing models for years.
Advisory work requires a different approach. You’re no longer focused only on completing the financial statements. You’re using the information to help clients improve their businesses and reach their goals.
That transition may feel uncomfortable at first. It may also become one of the most enjoyable parts of your work.
There is tremendous satisfaction in watching a client finally understand what the numbers are telling them and use that information to make a positive change.
Why Hourly Billing Can Limit the Relationship
Moving into advisory services also creates an opportunity to rethink how you charge clients.
Hourly billing can discourage clients from contacting you. They may avoid asking an important question because they’re worried that every phone call or email will create another charge.
That works against the type of open communication an advisory relationship requires.
Value pricing or flat-rate pricing gives clients more certainty. They understand what services they’re receiving and what they’ll pay for them.
It also allows the firm to price its services based on the value being delivered rather than simply counting the number of hours required to complete a task.
What Accountants Can Learn from Contractors
I’ve worked with plumbing, electrical, and HVAC contractors for approximately 40 years. These businesses have used flat-rate pricing successfully for decades.
When a contractor diagnoses a repair, the customer is given a price for completing the job. That price generally remains the same whether the repair takes 15 minutes or several hours.
The customer isn’t penalized because one technician works more slowly than another. They know the cost before the work begins.
The same principle can apply to many accounting and advisory services.
Rather than billing a client based entirely on the time spent completing a task, the firm can establish a clear price for a defined service or level of support.
This doesn’t mean every service should be offered at a fixed price. Work with an unpredictable scope, such as certain audits or tax disputes, may still need to be billed hourly.
But many recurring bookkeeping, reporting, review, and advisory services can be packaged and priced in advance.
Flat-Rate Pricing Rewards Efficiency
Hourly billing can create an unusual problem: the slower someone works, the more the customer pays.
Flat-rate pricing changes that equation.
The client pays an agreed-upon amount for the outcome. The firm then benefits from improving its systems, training, and efficiency.
This model also encourages firms to examine how long work should take and why certain team members may require more or less time to complete the same task.
If someone takes twice as long as expected, the firm can determine whether additional training or a better process is needed. If someone finishes unusually quickly, the firm can make sure the work was completed correctly and corners weren’t cut.
Clients Appreciate Pricing Certainty
Business owners generally dislike surprise bills.
They want to know what they’re buying, what support is included, and how much they should expect to pay each month.
A firm might offer several levels of service, allowing clients to select the amount of reporting, communication, and advisory support that fits their needs.
Clients can then move from one level to another as their businesses grow or their needs change.
This structure makes the value easier to understand and creates a clearer relationship for both the client and the accounting firm.
Start Preparing for the Transition
Financial advisory services allow accountants to provide the judgment, insight, and trust that technology can’t replace.
Value pricing can support that relationship by creating predictable costs and making clients more comfortable asking questions before a financial issue becomes a crisis.
The transition may feel intimidating, especially for firms that have billed by the hour for many years. But when the services and pricing are structured properly, clients often appreciate the clarity and the opportunity for a stronger relationship.
The next episode in this series will explore how to identify a great financial advisory client.
Frequently Asked Questions About Financial Advisory Services
Why should accountants offer financial advisory services?
Technology is automating many routine accounting tasks. Financial advisory services allow accountants to provide greater value through financial insight, judgment, oversight, and guidance that helps clients make better business decisions.
What are financial advisory services?
Financial advisory services involve regularly reviewing a client’s financial statements, identifying important trends, explaining what the numbers mean, recognizing potential problems, and helping the business owner determine what actions to take.
How does AI affect accounting firms?
AI can complete many repetitive accounting activities faster and more efficiently. Accounting firms will still be needed to verify the information, provide context, exercise professional judgment, and advise clients.
What is value pricing in accounting?
Value pricing means charging an agreed-upon price for a defined service or outcome rather than billing the client solely according to the number of hours worked.
What is the difference between value pricing and hourly billing?
Hourly billing charges clients based on the time required to complete the work. Value pricing establishes the price in advance based on the service, scope, and value delivered to the client.
Can all accounting services use flat-rate pricing?
No. Services with an unpredictable scope, such as certain audits, tax disputes, or complex investigations, may still need to be billed hourly. Recurring bookkeeping, reporting, financial reviews, and advisory services are often better suited to flat-rate pricing.
Why do clients prefer flat-rate pricing?
Flat-rate pricing gives clients cost certainty. They know what services are included and how much they’ll pay, which reduces concerns about surprise bills and can make them more comfortable contacting their accountant with questions.
How can an accounting firm begin offering advisory services?
A firm can begin by reviewing client financial statements monthly, identifying trends and potential concerns, scheduling regular conversations, defining the advisory services it will provide, and creating clear service levels and pricing.