Client Accounting Services (CAS): A Real-Life Example

Imagine this: You and your spouse start a business. You have a background in marketing (perfect!) and your spouse has a background in sales and operations (fantastic!). You maintain your full-time job in marketing and help with the business on the side while your spouse runs the business full-time. You both hit the ground running, even though there is a pandemic going on in the world around you. You know it will not be easy, but there is no doubt you make a great team. You are bootstrapping it and learning as you go, but you know one day the business will be thriving and you can hire a team and outsource some functions. You’re both right-brained, so what is the first thing you look forward to handing off when you can? ACCOUNTING!

You head to Google and start searching for help: outsourced accounting, bookkeeping, payroll help, cash flow consulting — anything you can Google to find the type of help you need. Then you find exactly what you might be looking for: client accounting services (CAS). But what does that mean?

What is Client Accounting Services?

After a brief search online, you learn that any which way you call it, client accounting services (CAS) means that your accountant handles most, if not all, of the accounting functions for your business. They prepare your financial statements, process your accounts payables and receivables, keep your books, do your payroll and make sure you are compliant, and pay your sales tax and do your sales tax reports. They can even help with cash flow, tax planning, and budgeting and forecasting. Now you are daydreaming about all the time that would free up for you and your spouse to focus on the things you are good at.

The Many Names of CAS

Let’s take a look at CAS from an accounting perspective. At my firm, Landmark CPAs, CAS has been around for at least 50 years. As a matter of fact, we have a few bookkeepers who have been with our firm more than 25 years — one will celebrate 40 years with the firm later this year. In my research for this article, I was shocked to learn that CAS is a trending topic now, when our firm has been offering these services for so long. For us, they are called “accounting services” and include all the traditional CAS services like bookkeeping, AP/AR, controller assistance and outsourced CFO, payroll services, financial statement preparation, and even QuickBooks training and support (we have several QuickBooks Pro Advisors on staff). Landmark’s primary client base is small business owners, so these services have been a natural fit for our firm for a long time.

At Eide Bailly, one of the top 25 CPA firms in the nation, CAS is called “Business Outsourcing & Strategy” and includes all of the same services mentioned above. The firm launched the service line several years ago, and their website includes a robust collection of webpages dedicated to each individual service within the BOS offering as well as a large assortment of related blog posts addressing the issues business owners face. Eide Bailly offers several packages tailored to a business owner’s individual needs like the Explore package for bookkeeping services, the Grow package for CFO services, and the Dream package for controller services.

In western Colorado at Dalby, Wendland & Co., a regional firm, CAS is new, having started the practice only about a year and a half ago. Sonya Foster, their marketing manager, explained, “When initiating CAS, we found the services provided within it meant different things to different firms and people. It seemed some just changed the name from bookkeeping to CAS, and some were more outsourced CFO/controller focused. Most all promoted cloud technology and a comprehensive tech stack as an important factor. We chose the more advisory CFO/controller path, but we still named it CAS after much debate between CAS and CAAS (the extra “a” is for advisory).”

The challenge for Dalby CPAs has been finding a director for the new service line to take the lead in developing consistent processes, people, technology, and business development. Marketing the new service has included some general branding and awareness ads through channels like radio, digital, billboard, and print. Sonya noted, “Without someone internally driving the development of the new services, the campaigns have been more general awareness. Our staff has been asked to recognize CAS opportunities and handle them in each office. We recognize there are many opportunities for CAS and many of our clients could truly benefit.”

Bennett Thrasher in Atlanta took a different approach with their long-standing CAS practice, which is called “Business Process Outsourcing.” Business Process Outsourcing (BPO) includes CAS as well as Advisory and Interim Advisory Services (Fractional CFO), and Business Transformation Services. They have had a longstanding client accounting practice to help with bookkeeping and outsourced accounting functions, but the fractional CFO services and transformation services are newer to the firm. “BPO is a service that we feel will only continue to grow and provide value for both existing and new clients. Outsourcing accounting and finance functions at a custom level helps take a large burden off many of our medium-sized clients’ plates and helps us sell other services in the future,” said Bennett Thrasher’s Marketing Manager Allie Donahue.

The firm markets BPO services in a variety of ways that include lots of cross-selling to existing clients and creating content and thought leadership pieces to support the practice. They also produce an innovative weekly video series featuring clients, referral sources, and prospects who talk about the power of Bennett Thrasher’s tools as well as industry trends and advice on how to elevate company financials to the next level.

The Scope of CAS

Let’s go back to my business owner example. As a business owner who is still getting your business off the ground with a limited budget, it makes sense to start small. Maybe you will hand off your bookkeeping at first and see how that goes. After a few months, your sales are growing enough to support handing off payroll. And then your accounts payables and receivables. It is a win-win. You get to focus on the things you love and are best at, and you have peace of mind knowing the financial portion of your business is in good hands.

It is a win-win for your accountant, too. They can customize the services they offer to best meet your unique needs, adding value to your business while also adding value to their firm. They have more insight into your business and can offer additional services and advice like help with tax planning or wealth management (think client retention!). Slowly, there is a shift from talking about what has happened to what will happen. Everyone benefits on multiple levels.

What are the Benefits?

Bill.com conducted a Client Accounting Services Survey in 2018 that found companies that outsource all of their accounting report both hard and soft ROI, including higher profits and revenues, being better armed to make business decisions, and enjoying an easier accounting experience. What’s more is that nearly 80% of CAS clients are likely to refer their accountant.

Other findings from the survey include:

• Eighty percent of CAS clients say they have more time to focus on their business.
• Sixty-eight percent report that accounting is easier and more efficient, thanks to CAS.
• Half of the CAS clients say they worry less about mistakes.
• Roughly 30 percent of companies outsourcing accounting have received advice from their accounting firms that has helped them increase profit. The same percentage also feels more prepared to make business decisions.

It comes as no surprise, then, that CAS has become a trending topic in the accounting industry. The 2018 AICPA PCPS and CPA.com survey found that well over 50% of firms in virtually all size categories are providing some form of CAS, and the first CAS Benchmark Survey (2018) from CPA.com and AICPA PCPS showed that practices of this kind are growing at a rate more than double the 5% median CPA firm growth rate. You can download the report here.

The shift in thinking from what has happened in a client’s business to what will happen represents a profound step forward for many firms. And it is exactly what clients today are seeking. Forward-thinking accounting firms can use CAS to pivot from a compliance-focused or transactional support orientation into a more strategic, advisory-level role.

The Reality of the Situation

Despite the fact that CAS goes by a wide variety of names with plenty of marketing methods, it is obvious why it is a hot topic now as many firms shift into a more advisory mindset, especially in light of the current pandemic. Client expectations are rising, and firms are searching for more ways to provide value. CAS provides the opportunity to do just that.

Let’s visit the business owner example one more time. The reality of that situation is true, and it happens all across America every day. I know because the story is mine. Unlike the example, I can skip the Google step. Lucky for me, help is in the office right next door.

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