Prioritising People, Skills and Retention: An Interview with Ian Phillips, Deputy Managing Director at Duncan & Toplis

For Ian Phillips, deputy Managing director of a top 30 chartered accountancy Firm Duncan & Toplis, the top answers for the biggest strategic challenges and opportunities for accountancy firms are Interlinked.

New products need to take into account the use of data to help and advise clients, and Duncan & Toplis’s new product Evolve does just this.

“Evolve takes the bookkeeping, takes it into the management reporting, developing management information (MI), and expanding almost from a standardised template into reporting functionality to look at KPIs for the business, whether it is financial, and then adding in statistical information to try and develop the client’s understanding and better knowledge of their business,” he says.

“That data is king, and the flexibility and ability to manipulate data now is so easy, and we’re seeing clients coming to us wanting us to help in the production of the MI and adoption of the monthly reporting packs – and we see this as an area that can add value, particularly if we can get the automation piece working properly because then our time can then be used on interpretation and advising the client as to which way they need to be travelling,” he adds.

Mr Phillips emphasizes that data the firm uses, both for its internal processes and for its clients’ needs to be accurate, and have integrity.

Compliance automation means advisory can grow

The research indicated that advisory services would make up the majority of revenue in five years’ time for most (59%) firms. Mr Phillips sees Duncan & Toplis as a provider of compliance services, but believes as an overall practice it will be a reduced proportion of its fee income from clients.

“We’re expecting our fees to continue to grow but there will be a greater proportion coming out of advisory because the compliance aspect is becoming more automated, and we need to be slicker and leaner in delivering that so that we can engage with clients where the real value is – in the advisory piece,” he says.

The firm probably does 1250 tax returns at its Newark office, and Mr Phillips says that technically 50% of these clients could do this themselves, and another 25% could do it with a bit of assistance.

“I tell you that because the 50% that we’re doing, they choose to pay us to do that job because they get comfort from using a professional,” he says.

“You can afford to lose 10 or 20 little jobs and you only need a medium-sized one that wants you to do the bookkeeping, to more than compensate for it,” he adds.

This would mean that the average fee per client will increase. Those who can’t afford it, or feel confident to do returns themselves, are likely to be lost but this will be made up of clients who require a full set of advisory services from bookkeeping to VAT returns, and accounts, tax and advisory.

Technical accounting is just as important

Mr Phillips was surprised that only six per cent of managing partners believe technical accounting is the most valuable skill for the future accountant.

“You gain your personal awareness and your observation of commerciality through experience but you need to have a high level of technical understanding to enable you to do that – the two fit together,” he says.

He spends a lot of time keeping up to- date with technical aspects so that he knows how to apply these in a commercial environment.

“If you separate the two, you end up doing things wrong because commercially what might be right could fail from a tax perspective or vice versa, for example,” he says.

However, he does acknowledge that with advisory services there is a greater emphasis on thinking outside of the box – 44% of respondents said creativity would be the most important skill for future accountants.

“I often say to team members that the client wants to go from A to B and to get to that you have to get to C first to get back to B because there’s a VAT issue or a tax problem,” he says.

The company tries to encourage this creative thinking and give team members experience of different business scenarios in real life.

He says that technical accounting, creativity and problem-solving are all on equal standing in regards to skills future accountants should have.

Our research found that communication skills to gather information, ask questions, recognise opportunities, foster openness and build trust were the key skills that managing partners thought their staff needed to work on.

Mr Phillips says that his firm has encouraged his staff to look for what they call “hooks”.

“So when the client is talking about any topic, for example, a new car – are you going to do it on a lease, are you going to do it on HP? Have you thought about the capital allowance system? Just using the general discussion the engineer hopes to go into an advisor piece,” he explains.

He said the firm is working with managers through a business development programme to make it clear that these conversations are not about direct questions to ask if they need advisory services, but more reactionary to general discussion points.