Receipt Bank Blog>AdviceFor Business>CPA Dana Maxwell predicts business expansion in 2021

CPA Dana Maxwell predicts business expansion in 2021



Receipt Bank

Dana Maxwell

Senior Manager for the Business Accounting Services Department at Harper, Rains, Knight & Company, P.A.

What challenges and opportunities will 2021 present for SMBs and how can accountants meet the evolving needs of their clients? Dana Maxwell, Senior Manager at US accounting firm, HRK, shares her predictions for 2021 in an interview for Receipt Bank.

What are the top three reasons clients turn to you for advice?

Clients come to us for various reasons. Sometimes, they are starting a new business and want us to give them suggestions on how they can structure their accounting in a way that would allow them to do the work themselves as a cost-saving measure for their business.  Others come to us because we understand what they don’t understand and they need us to be in charge of their accounting. We also have clients that have their basic accounting needs met either by doing it themselves or hiring an in-house person but they reach out to us when they have an issue they need guidance on, perhaps they want to change the way they process A/P or they are expanding their online sales and need sales tax guidance or tax planning guidance.

What are the most valuable services accountants can provide their clients with in 2021?

2020 was really hard for a lot of businesses. Obviously, we are hopeful for growth in 2021 but I think it’s going to be slow and difficult, so we really need to be proactive with our clients. For the clients that we are tasked with full-cycle accounting, we need to be keeping an eye on cash and expenses, and really be communicating what we are seeing in their books. So many business owners just look at cash and they do a pretty good job of knowing their cash position and calculating in their heads what they can pay and when, but most of them do not really take advantage of good A/P planning – they may know what bills they have to pay, but they don’t often know the order in which they can be paid.  We can use the various software platforms to accomplish a better timing of payments for them which can help strengthen their cash position.

Another major item that we will be dealing with in 2021 is going to be all the legislation around the various COVID relief packages. We went through this in 2020 when we jumped in and helped our clients with loan applications. Now we are working with them on the forgiveness applications, and soon we will pivot to analyzing the ability of our clients to secure more loans or take advantage of the various payroll-related credits that are now available. Clients are anxious to get started on any relief that is available to them and they rely on us to have an understanding of what is available to them and then work with them to get it ASAP.

How have client needs changed over the past 5-10 years?

Historically, clients came to us for tax return preparation or when they needed audited, reviewed or compiled financial statements. So an accounting firm’s focus was those services – tax and assurance, maybe we did payroll for a client or maybe we recapped their bank statements for them but for the accounting services department the focus really was processing payrolls and doing the recap work to support a monthly compilation.

What we have seen over the last couple of years is that less and less clients actually need the assurance services. Banks have loosened their requirements for financial statement presentation and will accept ‘management financials’. Of course, there will still be a role for assurance services, as many entities still do require audits and such, but for business accounting services we have been able to provide our clients more with what they need instead of what they thought they needed.

How has the availability of real-time financial data changed your relationship with clients and their expectations from accountants?

I spent almost 20 years in the hospitality industry before becoming a CPA, so I approached my accounting work the same way I approached my prior work – with “How can I help you?”.  The ability for accountants to now work in real time has really changed our ability to be of service to our clients. The old way of doing things was that each month we would wait for our clients to send us a prior month bank statement and their check stubs, then we would recap that information and produce a financial statement that was at least 15 days’ late, creating an after-the-fact scenario where all we could do was look back at what happened and then try to predict what would happen in the future based on what happened in the past – this rarely provided adequate assistance to our clients.

Real-time accounting has changed all that. Now we can be involved with our clients and their decisions and needs every day. We can provide real-time guidance and better planning because we know what is happening now – we are not spending our time looking back, we can be much more future-focused. Our duty with this expansion is to be able to meet those needs in real time and not slip back into the old ways of playing catch-up. Our clients know that we have the ability to be more engaged with their businesses, so we need to make sure that we uphold our end of the arrangement and make sure that we are maintaining the timeliness of communications.

How do you see business needs evolving over the next two years?

I think the next couple of years will see more of what we have experienced over the last year. We will spend our time shepherding our clients through this most difficult economic time and helping them plan for the future. I think in the latter half of 2021 and going forward, we will see business expansion – new businesses will rise and existing businesses will continue to seek ways to grow and expand. We need to be ready and have the resources to help our existing clients, and seek opportunities in our communities to be of service to the new companies that will surely be started.

How can accountants support the evolving needs of their clients?

We owe it to our clients to be informed – we need to constantly be thinking about our processes and be learning about software solutions that exist. It’s always easy to slip into the ‘this is the way we do it” mindset.  We need to challenge ourselves to consider if there are different ways of doing things, new processes, new software solutions.  We need to be aware of the options before our clients come to us and ask for it – we must continue to grow and learn ourselves, so that we can preemptively support our client needs. We really serve our clients best if we can identify a pain point in their operations and provide a solution before they have identified it themselves. We must always ask ourselves “Is there a better way?”

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