We all know that our clients are looking to us to provide higher-level, more prospective business insight, but how do we get there from here? You will learn how to seize the opportunity before the accounting profession today and the steps to ensure success.

1. HOWTOTAKETHEFIRSTSTEPSTOALUCRATIVE
VIRTUALCONTROLLERSHIP/CFOBUSINESSMODEL
A Special CPA.com Webinar
March 17, 2015

2. Thomas R. Gawne, CPA
Professional Services Systems
Engineer
28 years in the tax and accounting
technology sector
Consultant, Facilitator and Presenter
Introductions

3. Empowering CPA’s and businesses for the
Digital Age
CPA.com is a subsidiary of the AICPA

4. Dixie McCurley
Trusted CFO Solutions, Co-founder & Partner
Headquartered in Atlanta, GA (12 Staff)
Certified Intacct® BPO Partner & Bill.com
QuickBooks ProAdvisor, Member of Mindshop
International
After spending six years in Corporate Accounting at
EarthLink, Inc and four years to Business Advisory at
GH&I, LLP, Dixie is building the Client Services
Accounting Practice at TCFOS.
Nationally recognized thought leader in cloud-based
accounting.
As a self-proclaimed “foodie”, Dixie spends her free
time dining at the hundreds of restaurants Atlanta has
to offer.
Introductions

5. Expanded CAS Verticals – to
Professional Services, Distributors,
Start-ups
Currently 12 staff
o 2 CPA’s
o 1.5 Business Developer (FT)
o 1.5 Intacct Champion
o 3 Managers
o 3 Staff
o 1 Project Manager
Fully Integrated Intacct, Bill.com and
Paychex, Avalara
Complete Paper-less System
Vertical Restaurants - CAS
Started with 2 clients & 3 staff
Used many different accounting
systems
Attended CAS Roadmap to
Profitably workshop in DEC 2011
Consulted clients as outsourced
CFO & Controller Services
Realized by the hour and
“consulting” wasn’t as great a value
as outsourcing their accounting
operations
Signed on with Intacct & Bill.com
Trusted CFO Solutions: Then & Now
TCFOS OCT 2011: TCFOS 2015:

6. Assessments - $10,000
Implementations - $10,000 - 25,000
Monthly Services - $7,500 – 10,000
2014 - Projected 230% Revenue
Growth year over year
Now, fit clients to our services
Say “No” a lot, if not a good fit
Profitability = 30-35%
Assessments - $2,500
Implementations - $2,500
Monthly Services - $2,500
2013 - Experienced 338% Revenue
Growth year over year
Started with 2 clients
Would fit our services to clients
Say “yes” a lot, even if not a good
fit
Profitability = 10-15%
Trusted CFO Solutions: Then & Now
TCFOS OCT 2011: TCFOS 2015:

7. Our Agenda
Opportunity in the Cloud
Restaurant Niche Example
Key Elements to Success
Next Steps

8. The Second Industrial Revolution - 2010
“The full implications of the new machine age are going
to take at least a century to play out.”
- Erik Brynjolfsson, MIT Professor,
co-author NY Times Bestseller
“The Second Machine Age”
Source: TED Talk (Feb. 2013)

9. Growth of Cloud Computing
And Many Others
Small Business
Has Moved to the Cloud
Network growth:
>150% last year$150M recently
raised
QuickBooks® Online
500K users
Paychex Equity
Investment
Efficiencies saving 90
minutes per employee
per day
Serving over 10k firms
and top US banks
$45M recently raised

10. Moore Indicates That We Have
Crossed to Early Majority…
CHASM
Helping Firms With
Adoption Curve
Firm Solutions
CPA
Profession

11. 1990
2000
Today
Transformation of Client Accounting
Today’s
opportunity
 Cloud-based
 Integrated
 Paperless
 Dashboards
 Real-timeSmall businesses push
work back to firms to
focus
more on their business
Role of firms reduced
QuickBooks introduced
to small businesses

12. Accounting Services Today
The Opportunity
o Ride the wave of demand for outsourcing
o Leverage cloud technology to achieve productivity
The Challenges
o Commodity practice
o Low margins
o Hard to scale
o Hard to upsell to higher value “virtual CFO” services

13. Firm Value Chain
Input Data
Assemble
& Verify
Report
Analyze &
Interpret
Advise &
Consult
Higher Value
& Future Focus
Lower Value &
Historical Focus

14. What is Needed?

15. The Roadmap to Success
• Model for evolving Accounting Services as a practice
• A guide to technology investments required
• Change management strategy – internal and external
What is Needed?

16. 3 Key Strategic Decision Points
Determine current and desired state of your client
accounting service practice
o Evolution of client accounting services
Identify technology investments appropriate to
stages of transition underway
Organize change management around specific
business practice transformations and
technology deployments
o Orchestrate change initiatives that minimize wasted efforts
and maximizes lasting improvements

17. Getting Vertical Through the Cloud
Business
Intelligence
Reporting
Real-Time
Client
Collaboration
Standardized
Workflows
Client
Accounting
Capabilities
driven
through
cloud
computing
• Professional Services – 90%
• Construction – 76%
• Retail – 75%
• Not-for-Profit – 73%
• Manufacturing – 65%
• Wholesale Distribution – 61%
• Technology Companies – 59%
• Transportation – 48%
• Hospitality – 45%
• Franchises – 40%
• Government – 29%
Most Popular Client Verticals
for Outsourced Accounting Services

18. A Restaurant Niche Example . . .
Passionate about the
food service industry
Existing
clients
• Accounting
Cleanup
• Disparate Systems
• Inaccurate Data
• Out-of-balance
accounting
• Tax Compliance
• Employer Tip Credit
• Cost Segregation
• Opening new
locations
Client
Needs
• Management
reporting
• Uniformed,
standardized
accounting
system and
structure
• Internal Controls
Restaurant
Industry
Niche
WhytheRestaurantIndustry?

19. Today: Disconnected Systems Ideal: Connected/Holistic
QuickBooks POS Payroll
Manual
Processes
Restaurant
Managers
Many
checkbooks
Several
locations
Bookkeeper Inventory
Restaurant
Group
Consistent
Processes
Cash Control
Consolidated
Financials
Multi-Entity
Reporting
Full Financial
Visibility
Cloud Based
Systems
To Transform Restaurant Accounting

20. Significant Growth Opportunity
• Vertical Growth – distributors & suppliers
• Customer Loyalty & Financial Reporting
• Management Accounting & Restaurant Consulting
• Scalable from 1 to over 1,000 clients
• Leads to other Niche areas – retail, hospitality,
private clubs, franchises, etc.
Are you keeping up with the growth?
WhytheRestaurantIndustry?

21. Typical Restaurant Structure
M-Console
Shared
Corp Restaurant 1 Restaurant 2 Restaurant 3 Restaurant 4
Company
M-Console
Company, Inc.
Currency USD
Company
Currency: Cayman
Company
Currency: Cayman
Company
Currency:
Cayman
Company
Currency EUR
Company
Currency: EUR
Company
Currency: CAD
Company
Currency: GBP
Consolidations 1
Currency: Cayman
Consolidations 2
Currency: EUR
Consolidations 3
Currency: USD
SIMPLE
COMPLEX
Single Accounting Console
• One common set of data across all locations
• Locations are created within single
transactional environment
• 1 TIN for entire company for all locations
• No ability to manage locations independently
• Books maybe balanced by location and/or by
entire company
Multi-Entity Shared
• Shared Data
• Chart of Accounts, Customers,
Vendors etc.
• Single Intacct Database
• Single Base Currency
• Each entity may be managed
independently or from top
• Books maybe balanced by entity or by
entire company
• Consolidations performed from top
level

22. Restaurant KPI Examples
KPI’s
Number of table turns
Food categories
Turnover of total room
Guest Counts (growth)
Per person Average
Controllable Income
Average Ticket Price
Food & Beverage Mix
Historical vs current
Total # of seats
Comps
Other Measurements
Prime Costs
o COGS + total labor + ee
benefits
Food & Beverage Mix
o Revenue 60/40 average
o COGS 33% food; 25% bar
13 week periods
Labor
o Mgmt 4%; direct 14%;
other 5%
EBITDA: 25-28%

23. Restaurant operators
o Scrutinize food and
beverage costs
o margin by menu item
o by location
o by server
> Business actions that
increase gross margins
Role-based dashboards
Management by KPI’s
Reporting Examples
Food
Sales
Liquor
Sales
Other
Sales
Food
Sales
Food
Costs
Food
Margins

24. Trusted CFO Solutions – Our Method
Alternatives to pricing your services based on client-perceived
value, rather than hours spent
Assessment
Phase
• Discovery
• Assessment
• Recommendations
Implementation
Phase
• Project Planning
• Prioritizing Goals
• Take Action
Client Services
• Back Office
Accounting
• Virtual CFO
• Cloud based Solutions
Fixed Fee
Products &
Services
Ron Baker says:
“Billing ≠ Pricing”

25. The Critical Pieces of Getting Started
Learn About and Build out Your Roadmap
Champion Needed to Lead the High-Value CAS Firm
It starts with the Business Plan
Don’t go it alone – Employee, Professional and Client Advisory Boards
The standardized practice & “Getting Vertical”
Mandatory Client Assessment as a stand-alone engagement
“Before-and-after” presentation
Engagement Letter and Service Level Agreement
Procedures Manual (shared with client)
New Client Orientation
New Client Training
o Technology
o Financial Statements, KPIs, Critical Success Factors

26. The Standardized Practice
Consistent/standard Chart of Accounts (COA) as one package
price. Premium fees for a custom COA
Standardized services by industry vertical and by type of
service
Standardized Internal Management Reports/Services
Procedures Manuals for each client
Service Order Requests for services outside of the
engagement agreement – retainer always on account for
these requests and for “concierge” services
Dedicated client-service staff to provide top client experience,
while sheltering our production staff

27. Client Accounting Services
The services offered within Client Accounting Services
groups generally fall into three categories:
Financial statement preparation using the accounting data
provided by the client, which often requires compilation
Transaction processing, such as entering accounts payable,
receiving approval for payments, sending payments
CFO/Controllership services, includes reviewing financial
performance and providing input and strategies to improve
business processes and performance

28. Increasing Firm/Client Collaboration
The economy requires closer CPA firm and client
collaboration to deliver better financial advice, help them make
faster, smarter business decisions and improve their financial
performance
Real-time vs. after-the-fact decision making
Firms are focusing on technological improvements to enable
heightened collaboration and are making the following shifts to
their client accounting services practices:

29. Client Accounting
Services
• Firm typically has 25-200 clients
• Clients have $1 - 5 Million
annual revenue
Firms are charging value-add bundled retainer fees
for these services – $1,500 - $5,000 / mo.
Most Common Services:
• Financial Statement
Preparation
• General Ledger/Trial Balance
• Payroll Reporting
• Cash Flow Management
• Payroll Preparation
• Transaction Processing (BPO)
• Virtual CFO Services
Majority of Outsourced Accounting
clients have between 5-25
employees
CPA Firm Client Accounting Services Profile

30. Service Delivery Platform
The service delivery platform is a term used regularly in the
“cloud-computing” world
o Defined as the available technology components and/or solutions that
will be used in the client accounting service delivery model
For example: could include the following integrated business
solutions
o Intacct Financials-on-demand
o Bill.com cash flow and bill management
o Paychex integrated payroll services
o XCM workflow management

31. Steps in the Prospect-to-Client Process
Qualification of prospect / analysis of existing client opportunities
Ongoing Services
Phase 4 Monthly recurring virtual accounting and Controller/CFO services
(Firms are charging $1500-$10,000+ monthly fees for this)
Short Term CFO/Tech Consulting
Phase 3 Data File Clean-Up, Staff Training, Management Report
Package Preparation, Process Implementation (CFO)
Client Needs Assessment
Phase 2 Initial Client Needs Assessment (firms are charging between $2,000-6,500+
for this). May be accompanied by financial clean-up and/or other services
Prospect Qualification
Phase 1 Prospect Questionnaire
Learn how at the Client Accounting Workshop!

32. Cost Estimating Tool

33. Defining the Scope

34. Assemble Your Team
Partner-in-Charge CAS Business Group
Business
Development
Marketing/Sales,
Finance,
Human Resources,
Technology, etc.
Director of Client Accounting Services
Virtual CFO
Implementation
& Client Support
Services
(separate positions as
the firm grows)
Client Relations (Client
Scheduling, Contract
Maintenance, Client
Satisfaction)
Virtual Controller
Accounting Manager
Accounts
Payable
Accounts
Receivable
Payroll

35. Plan

36. Marketing – Top Firm Challenges
Client Accounting Services has not been adequately positioned and
sold “within the firm” so is not positioned for success publicly.
Limited resources and lack of year-round consistency
Strong reliance on passive word-of-mouth for sales
Focus on developing sales through new customers
Limited market intelligence and ongoing research
Lack of complete budgeting and ROI reporting to measure results vs.
expectations

37. Segmenting Your Market
Firms who have successfully identified and built their marketing
and services around industry verticals are able to get the most
from each marketing dollar by specifically targeting WHO they
need to reach and WHERE.
In the CAS practice, clients expect us to know more than they
know about how to win in THEIR industry in addition to ours. Firm
marketing materials should demonstrate that we “get it.”

38. Types of Marketing Activities
Marketing
Activities
Present at
Industry
Events
Georgia
Restaurant
Association
Webinars
Whitepapers
Client
Testimonials
Case Studies
(Simple &
Complex)
Interviews
and Articles
in Industry
Publications
• Speak to the chef, compliment food,
decor, service
Connect with Restaurant Owners
• Ask what systems they use, offer
recommendations for issues, tell them
you’re establishing a niche, get
feedback
Establish a rapport
• Post comments on Yelp, Open Table,
Food Spotter, Social Living. Tell them
you are; tell them you did.
Give reviews and feedback
• At their restaurants, Taste of Atlanta,
Dine America Gala, Georgia Restaurant
Association, Culinary Colleges
Attend Events

39. Other Workshop Topics
Engagement letter templates and service level agreements
Key cloud based solution case studies to build the model
How to build your business plan
Key performance indicators (KPI’s) success factors
Rich virtual toolbox of templates and documents to complement
Collaborative engaged exercises to enhance learning
Small facilitated group to enable shared learning amongst
participants!

40. Join Us for Our Next Workshop
Seats still available at our Towson, MD Workshop!
April 21st & 22nd
Maryland Association of CPA’s
901 Dulaney Valley Rd, Ste. 710
Towson, MD 21204
Sign-up: CPA.com/casworkshop
*Save $300 when you register by 3/20

41. Join us to learn, engage, and develop at this year's Digital CPA Conference...
• Engage with thought leaders and peers
• Develop the critical skills required to address key issues impacting today’s
accounting practices - from technology implementation and practice
management to evolving client expectations