Recent research has shown that 45% of accountants expect their work with advisers to increase over the next two years, with the majority citing pension changes as the primary contributing factor (economia, 2016). It makes commercial sense that with professional and transparent collaboration, both accountancy firms and financial advisers can provide a powerful and mutually lucrative service that is of greater overall benefit to a client. Here we explore the primary reasons why collaboration is so important in the current financial market.
1. New business channels
The UK financial regulator and government have proposed significant regulatory changes to ‘close the advice gap’ that is affecting millions of consumers who have been priced out of the advice market. With the regulator concentrating on making it easier for IFAs to offer cheaper, more basic services to accommodate a wider spectrum of clients, it is highly likely that the average customer value will begin to decrease with time. Integrating ‘add-on services’ from a trusted accountancy practice should provide a consistent referral income to boost overall client value.
2. Find new clients
One of the greatest challenges facing IFAs in the new regulatory landscape is business development. Strategic relationships with an established chartered accountant can provide increased opportunities to source new clients and can also eliminate any gaps in service for both businesses.
3. Integrate financial and tax planning strategies
With careful guidance, an accountant should be able to assist an IFA to broaden the financial planning strategy. Increasingly, accountancy firms are electing to obtain a DPB (Investment Business) licence, which gives an accountant the opportunity to provide complementary financial advice to their clients on specific exempt regulated activities (ERAs). The licence allows an accountant to explain, evaluate and endorse advice given by an adviser as well as assist in implementing this advice.
A last word….
It goes without saying that not all accountants are the same and it is important to find an accountancy practice that is aligned with your financial planning business, with a shared professional culture and approach to customers, which will go a long way in ensuring a successful cross-over of long-term happy clients.