3 min read

How to build a foundation for advisory services


The worst-kept secret in the accounting profession is that client advisory services, or CAS (sometimes also CAAS, or Client Accounting and Advisory Services —  just to keep it all exciting), are a huge profit center for firms. As more and more firms of all sizes evolve their business models to address the demands of an increasingly savvy client base, advisory services are only increasing in prominence and importance.

But what’s sometimes lost in the hubbub surrounding CAS is the importance of establishing the foundation for its success. That might sound obvious on the surface, but many firms trying to evolve their business model miss some of the basics — and these mistakes can be avoided.



Why advisory services matter

CAS is the fastest-growing revenue source for firms. According to AICPA President and CEO Barry Melancon (as told by Accounting Today in September of 2020), CAS represents 10% of major firm revenues. Properly planned and implemented, it’s more profitable than either tax or assurance engagements. So it’s worthwhile to do it right.

As a focus for revenue, CAS offers something many other areas of traditional accounting services don’t — predictability and recurrence. But probably best of all, it creates a client relationship in which your firm becomes an indispensable partner; your technology- and people-driven approach can uncover information for clients that they can’t get anywhere else. As you can imagine, this enables a cascade of both informative and predictive inputs that can develop businesses in ways unimaginable just a few decades ago.

This is the kind of service clients are expecting and demanding today; initiating and/or developing your advisory practice is no longer just a nice-to-have. It’s an imperative. Advisory services don’t just matter, they are the present and future of the profession.



Naturally, there are hurdles to building a CAS practice

You’re probably all too familiar with the pains facing so many firms at the moment. Capacity, hiring, retention, technology… there’s a dizzying mix of challenges to running a firm. Building a new practice within that firm might seem a bridge too far in terms of resources alone, but if it does, it’s likely because you’re thinking of a CAS department in terms of a traditional business model. CAS needs a different approach.

In reality the biggest bottleneck in building a CAS practice isn’t any of those well-discussed topics. It’s bookkeeping. Without significant and effective automation, bookkeepers operate in disparate ways devoid of standardization. Manual tasks eat time. Bookkeepers quickly burn out on repetitive and menial tasks largely beneath their abilities. The crunch results in hits to timeliness and accuracy, and ultimately, attrition.

And without the bookkeeping data, you’re missing a key component to the foundation of CAS services: clean, reliable, up-to-date books.



What makes a strong CAS foundation?

Recently, Deneen Dias, VP Growth and Strategic Partnerships, Botkeeper; David Emmerman, Head of Enterprise, U.S. Xero; and Ryan Faulkingham, Principal Solutions Engineer, Botkeeper sat down to discuss these topics and proffer some solutions to creating a CAS department that’s built to succeed and grow. Perhaps unsurprisingly, technology is very high on the list.



If the client data isn’t in the cloud, it will be that much harder to make effective use of it for advisory. Xero was developed as a cloud-based general ledger solution — it never had a desktop software product. According to Emmerman, it was designed to play well with the other essential apps of the profession, creating seamless workflows that immensely ease recording of the books. This puts a focus firmly on real-time discussions around transactions and books — rather than waiting weeks, months, or even a quarter to discover the information that would have been useful if only it had been available sooner.

As such, Xero plays well with Botkeeper, which works along with Xero. As a human-assisted AI platform that automates bookkeeping, Botkeeper is purpose-built for accounting firms. It delivers a full-suite bookkeeping and pre-accounting solution, and handles critical, time sensitive (but low-margin) work at scale. Using machine learning, Botkeeper can automatically categorize transactions and post them to the Xero or QBO GL, furthering that real-time discussion we mentioned.




Obviously, when you have good people, you want them to be happy. And it’s hard to make people happy when they aren’t doing the work they most excel at. Having talented employees stuck in coding transactions when they could be doing more both for the firm AND for themselves is a prescription for disaster. And so is, by the way, not having the right people in the right roles. That means having a dedicated, experienced CAS manager heading up the practice, and employees suited to the advisory mission. The people you need aren’t CPAs or even accountants? That’s okay! It’s a known and accepted trend that firms increasingly need expertise from other areas of business to fulfill their clients’ needs.




Understanding how information flows through a CAS practice and what impact that has on your firm and its personnel and clients is essential to the foundation of your department. Also important is documenting those processes so knowledge transfer is simplified. 

All of this is secondary to your firm saying “yes” to the simplest request a client can make — help me with my books. This is your open door to eventual CAS relationships that can never get off the ground if you don’t offer what clients need most in the beginning. 


To hear the full discussion Deneen, David, and Ryan had, you can watch it for free, just by clicking on the button below. Happy CAS-ing!


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