A Compelling Growth Opportunity for CPAs

Hannah Shaw Grove, author of The Family Office: Advising the Financial Elite said, “When an accounting firm creates a dedicated business line to address the needs of clients, there’s substantial evidence that it can increase the firm’s overall profitability, support cross-sell and expansion opportunities, and be a differentiator vis-à-vis their competitors.” Your wealthiest clients need you to do more than just file their tax returns each year. They need a broad array of services that encompass not just tax, but financial, legal, and business services too. Your clients need Family Office services.  

The notion that a family office is just an investment office for families like the Carnegies or Rockefellers is outdated. It is true that family offices originated as full-service private wealth management providers that served just one or a small number of ultra-high-net-worth families, but because of the model’s appeal and the spread of wealth to the “millionaire next door,” this model has broadened in terms of reach, scope of services, and the type of firms offering these Family Office services.  

Beyond basic or comprehensive wealth services, family offices can also provide concierge services, financial and estate planning, charitable-giving advice, and advanced tax planning. Family Office Services can fall into the following categories:  

• Business Services Help business owners with strategic planning, financing strategies, exit planning, and wealth management services.  

• Alternative Investments A range of traditional and alternative investments provide diversification with an eye towards coordinating with the client’s tax strategy.  

• Strategic Relationship Management Concierge and management services to save clients’ time and make their lives easier.  

• Tax and Compliance Outsourcing Specialists can supplement your core capabilities and handle excess demand or special situations.  

• Family Governance Help families with legacy planning and governance.  

• Income and Estate Planning Tax Mitigation Provide proactive strategies to increase liquidity or reduce tax liability in estates and disposition events including sale of a business or building.  

• Charity and Philanthropy Create and managing advanced charitable structures to achieve clients’ philanthropic goals while mitigating tax obligations.  

You may think that your firm is too small or that you do not have the resources to implement all (or any) of the services listed above, but that is where Array Partners comes in. We have already built a vast network of experts to help you provide Family Office services. Array Partners’ white-labeled partnership model can integrate with your firm seamlessly to help you deliver these services to your clients. Contact us today to learn more about how a partnership would work and see if it may work for you.  

Growing Demand for Family Office Services from Tax & Accounting Firms

“The services provided by CPAs have become so broad and diverse that the concept of core services is no longer representative of the profession.” – CPA Horizons 2025 Report

To add more profit, most people (wrongly) assume that you must add more clients. To bring in an additional $80,000 in profit, you may have to bring on an extra ten, twenty or even thirty clients and all the additional hours that come with them.  What if, instead of working to add 10-30 new accounts, you expanded your service offerings to the clients who already trust you?

An expanding trend in the U.S. is for accounting firms to offer strategic services and consulting engagements to support the growing demand of their clients. As reported in the Horizons 2025 Report, more and more of your clients expect access to proactive counsel in finding solutions to their concerns. In fact, the lack of such services was the number 2 reason for leaving an accounting firm (right behind a failure of the firm to return phone calls), as cited in the Horizons Report.

In general, these engagements follow a specific sequence:

• Discovery is conducted to examine the depth and cause of the issue

• Research is done on potential solutions

• Providers are identified who scope out and price the engagement

• Solutions are presented to the client

• The client accepts the scope of the work and signs the engagement agreement

• Someone oversees the solutions providers to ensure the engagement is completed on time and on budget

The advantage of such a defined process is that it allows the CPA to control issues that often create stress for the client and interfere with other aspects of financial and tax reporting. Such a process allows the CPA to get paid for what they know and the value they bring rather than how long it takes them to do something. By bringing ownership of the issue in-house, the CPA also reduces the risk of a referral gone wrong, jeopardizing the relationship with the client.

The challenge most firms face is that they do not have the internal capacity to add or promote these services, and they don’t have the expertise to properly define or price such engagements. However, the potential profit is great, and demand is growing rapidly. For these reasons, more firms are electing to enter joint ventures, which allow the CPA to maintain oversight of the project and client relationship while outsourcing most of the actual work. Learn more about how a joint venture could help you break into this market and grow your business.

Strategies to Help Your Business Clients Today

As much of the country begins to restart their economy, many business owners are faced with the task of what is essentially restarting their business. Restarting is easier than beginning from scratch, but they still have a lot in common. Importantly, restarting probably means they have more overhead than sales for a while. Business owners now must protect their employees while putting customers at ease and many of them simply do not have the same appetite for sacrifice that they did when they started. Simply put, business owners have a lot to worry about right now. However, you can make yourself indispensable by helping in the following ways: 

Help them secure funding (either traditional or disaster related) Your clients still need their books in order. Lenders may be more cautious with debt ratios and company valuations, so they might require more collateral than they have in the past, making it might be harder to get the working capital needed to restart. Prepare your business owner clients they may to need to pledge additional assets to secure loans or seek nontraditional financing.   

Study the CARES Act There are other credits and extensions included in the CARES Act that can be taken advantage of to help improve cash flow and even get clients a refund for 2019. For example, any loss this year (2020) can now be applied to the past three years (2017-2019), which may allow business owners to get a refund now instead of carrying the loss forward. Another way to find more money in this year’s tax return is to check clients’ depreciation schedules. There are other useful items packed into the CARES Act, so please contact us if you need help finding a way to help your clients.  

Engage in a Cost Audit Help clients reduce their overhead by reducing their costs. A cost audit is a line by line review of a company’s expenses. We use a specialty firm, whose staff have varied areas of expertise, to conduct these audits and spot inefficiencies and solutions quickly. The firm works on a percentage-of-savings basis, so your client only incurs a fee if the solution provider can identify and implement savings. We just completed an audit for a client where we increased profitability by 8% without new sales or cutting staff/benefits/resources. 

Start a Cost Segregation Study Anyone carrying more than $400,000 in depreciation might be a candidate for a cost segregation study, which can reclassify certain assets onto a shorter schedule and allows clients to recoup their costs more quickly. Typically done for larger projects, we have the means to apply the process to lower cost items, which enables small business to take advantage of a strategy enjoyed by large companies for years! 

Business owners are struggling with how to restart their businesses after the stay at home orders get lifted. Now more than ever your business clients need you to be proactive. Reach out with a keen eye toward helping them recover, and you will secure your position as crucial advisor. Remember, their business (and yours) depends on their success.  

Building your Family Office

There have been many articles recently in various accounting journals about the need to add consulting services to your practice and a common thought is to add “Family Office” type services to your practice. I agree that adding family office services is a great way to build better relationships with your best clients and diversify your revenue, but before you try doing it on your own, let’s explore what it takes to build a family office from scratch.  

A family office traditionally oversees the vast resources and assets of an ultra-rich family (think Jeff Bezos, Lebron James, or Oprah Winfrey). Our clients are not ultra-rich and don’t have enough resources to afford a family office on their own; but they do have more wealth than can be well served by the traditional retail process of separate relationships with accountants, insurance agents, lawyers, bankers, and investment advisors.  

Our target clients typically have a net worth between 5 and 50 million dollars and/or an annual income above $400,000. You probably have several of these clients already and have experienced some of the frustration that comes with trying to help them navigate complex transactions. Changing your practice to better serve these clients and attract more of them will increase your revenue per client and reduce your reliance on tax revenue.  

The right client will gladly pay you a fee to help them manage their financial concerns and wealth. They will happily pay a little extra to make sure someone is taking a forward-looking proactive approach to everything going on in their life. To justify that fee, you’ll have to set up what we call a Virtual Family Office, which requires a diverse set of skills and members with expertise in: 

• Law 

• Accounting 

• Lending 

• Risk management 

• Operations 

• Interpersonal communication/conflict resolution 

These experts need to be able to work as a team and need to be accountable to the group. The group must have a Facilitator, who acknowledges the needs of the individual and is able to guide the group in reaching consensus. We have been most successful in this role leading the virtual team, while playing “2nd chair” to the person who is the lead of the client relationship.  

Team members must be experts in their field and be flexible enough to recognize that their optimal solution may not be in the best overall interests of the client. They must also have a work arrangement that allows them to be brought into engagements on short notice. We recommend that you have a standard set of processes to validate and document members’ expertise. It is not enough that someone says something on their website; they must be able to prove it for them to fill a role on the team.   

Once you have identified how you will verify and maintain the credentials of your virtual family office mainstays, it is time to develop your “bench.” The bench are people or entities who have a specific or specialized skill set. They will not be regular members of the team, but they can be called in whenever their unique service is needed. Bench members will be added occasionally when you find a new need for a client that you have not had to address before.  

 Putting together a Virtual Family Office is more than just asking a few friends or acquaintances over golf to join you. It takes a lot of thought and time to piece together a functioning unit. If this is a bigger task than you want to take on right now, you can choose to engage with an outside firm to incorporate you into their model, which is what we have done for several accounting firms.  

Tax Season Conversations

Most CPAs would agree that proactively reaching out to your clients is a best practice. The resulting conversations, if done correctly, can give you deeper insight into clients’ motivations, resources, and challenges. Reaching out proactively means that instead of panicking and scrambling to fix things after the fact, you can get ahead of potential issues and plan accordingly. It can also mean uncovering new engagements with you and additional revenue streams, so everyone comes away happy.

Setting up these proactive discussions isn’t always easy, though, because clients are often “too busy” for a quick conversation at other times of the year. Although tax season is your busy season, it’s also the time when your clients are most engaged with what you have to say. Now is the time to set yourself up for success for the rest of the year. You will already be getting together to review their taxes and get signatures, so why not take advantage of that time to discuss other ways you could be helping them?

The conversations don’t have to be particularly lengthy – a few minutes of good discovery with your best clients should be enough to identify what plans they have for their business or investments. Then set a follow-up meeting after tax season or delegate the research to an associate who is not involved in tax prep. The conversations you have during tax season can be used to get ahead of your clients’ needs and build your workflow for the rest of the year.

Topics should be driven by the clients’ needs, but you can use this year’s taxes to show them ways they can be more tax efficient in the future and reduce their quarterly payments. Then use the follow-up meetings to transition into the more consulting-based engagements that we wrote about in January.

Most clients would welcome the help to run their business better if they knew you had the capacity and the ability to provide that help. By taking just a few extra minutes during your tax season meetings, you could generate additional opportunities to help your clients throughout the year. Proactive conversations help you demonstrate your commitment to their success and solidify your role as the trusted advisor they can’t do without.

Team-Based Advising: A Win-Win

Two heads are better than one. It’s a widely accepted principle for a variety of reasons. By putting two (or three… or four…) heads together, you bring multiple perspectives, educational background, training, and experiences together that simply aren’t possible for a single person. Your best clients often have complex issues, but those same issues can be an opportunity for your firm to shine.

Partnering with Array Partners can allow you to bring together professionals with backgrounds and expertise in law, risk management, investing, and even niche accounting that you can use to solve clients’ multifaceted problems. This team-based advising model gives you a team that you can turn to when your clients have special needs.

Rather than referring clients to people in your network, you are the central hub that allows your team to bring the thoughts of several disciplines together to brainstorm before any ideas are presented to the client. You delegate the task of coordinating the team to us while you remain the primary contact for the client and ensure that any ideas presented are compatible with your vision for the client.

Imagine for a moment that you have a client who is about to sell a major piece of real estate. Having a team could allow you to efficiently explore several options to address the capital gain while investing only a minimum amount of your personal time to accomplish it. How great would it be to be able to sit down with your client and already have had your team vet an opportunity zone, a 1031 exchange, an installment sale agreement, charitable options, and offsetting the gain with other investment losses?

In this scenario, does the client benefit from the team-based approach? Absolutely! They have several great minds working together for them. In the past, they might have had to go to you, a lawyer, and an investment advisor for the range of options that were considered. Now, instead of sitting through meetings with multiple professionals, they only have to call you.   

Do you benefit from the team-based approach? Yes! By providing such comprehensive counsel to your client, you solidify your place as their most trusted advisor – someone they simply cannot do without when it comes to making important financial decisions. You are their one-stop-shop for all things financial. Additionally, you can now charge the client extra for this type of comprehensive research, creating additional revenue for you while establishing yourself as the go-to expert for your clients. It’s a win-win for you and your clients.

Creating a Dynamic Practice

We hear about it everywhere. "Become a firm of the future!" this, and "Grow your practice" that, but there is never really any practical advice that produces tangible results. There is a lot more to creating a firm that is dynamic and adaptable than new software purchases and attending webinars (although there is some great content out there). To get you started, here are five tips for creating your very own dynamic Firm of the Future.

Upgrade your service offerings

The more different types of services you can provide to your clients, the less they will need to shop around for various providers. Everyone needs that person in their lives that can do anything, especially when it comes to helping them with their finances. Being able to offer a wide range of services that clients need, and that they also want, will keep them coming to you first for new services and new business. And for you, that means more money in your pocket.

Expand your knowledge

Let's face it: experts can charge more money. Having experience in areas lets you command more money per client and keeps those clients coming back time after time. It is not so easy to get another bachelor's, a master's, or even a Ph.D. It is, however, easy to get an expert on your team. At Array Partners, we offer services to help get experts on your side, while at the same time maintaining your client relationships.

Make your practice scalable

Sometimes there aren't nearly enough hours in the day, let alone enough hours for you to make your dream income. That's why making your practice scalable is a number 1 feature of firms of the future. If you've been in business a while, this can be simple. You know how much time it takes to get work done, so there isn't a need to worry about under pricing your monthly fees. We can also help you with this and show you how to command higher prices while keeping clients happy.

Make relationships a priority

Your relationships with your clients are one of the key things that keeps them around. Clients want more coaching and advising from you than they are already receiving. Helping them plan ahead for life-changing events so that they are as prepared as possible will make them feel great and value your advice even more. When you scale your business in the right manner, you can create more time to do all the planning with your clients and build the relationships that keep them loyal.

Invest in your practice

We should all know this by now, but it's incredible how many of us forget to invest in our practice. Stop doing the minimum. Go over and above your required training. Learn something new, increase your cybersecurity, or go paperless. Consult with an expert over a concern, problem, or question from a client. These are all simple ways that you can provide some much-needed investment in your firm’s future.

By teaming up with Array Partners, you add an enviable stable of experts that not only allows you to broaden your service offering, but also to learn from the best. Utilizing those experts to perform more tasks creates scale for your firm and allows you to focus more on maintaining the relationships that keep your clients coming back year after year. Let Array Partners help you live your best life. Contact us today to set up a consultation so we can show you the way into the future.

How to Stand Out from the Crowd

The people have made it clear, and the research proves that clients want CPAs that are proactive and hands-on. They also wish for CPAs that are fully engaged in all of the different components of their financial lives, not just when it comes to their taxes. Your clients may need help in business operations, tax matters, or any other kind of financial advising. Providing these services and more can help you build a stronger bond with your best clients. It can also help you create and maintain stronger relationships with some of your mid-level clients and help you push them to grow. Now, we know what you're thinking: "to do that, I would need a whole team behind me!" and we're glad you think so because we're thinking the same thing too. 

We are Array Partners, and with our over 65 years of experience behind us, we have built a network of some of the top experts in their fields. We have created a modern, value-based business model that allows you to do more for your first-class clients. It even helps you to earn more for your own business in the process. Our proven system uses the collaboration of all disciplines to ensure the best possible outcomes for you and your clients. We operate under the fiduciary standard, so you know that you and your clients are getting a top-of-the-line service that you can trust. 

Array Partners is more than an affiliation; it's a family. With our Family Office Division, we help you meet the high (and ever-growing) expectations of your clients. Let's say one of your top-tier clients approaches you with a concern, question, or problem regarding their finances, and you don't quite have the answer. Come to us with that same concern, and we will research options on your behalf. We can even assist you by mapping out ideas in a feasibility study and submit it to you for your review and vetting. After you are satisfied with your solution, we will then support you while you present your resolution to the client.  

Think of Array partners as an extension of your practice. When you work with us, you will have access to our 200 service providers. This network includes our tax mitigation law firms, legal specialists, investment bankers, and tax code experts. Our service providers are the best-in-class experts from around the country and will help you keep your clients' happy all the while improving their financial lives. Did we also mention that your clients always remain yours? You retain control of the relationships with your clients and can even get an increase in revenue by offering services and advice that you could not provide before. If this sounds like the perfect next step for your practice, then contact us today for a consultation. Let us show you how to take your firm into the future. And remember, here at Array Partners, you're not just an affiliate; you are family.