Date posted: 01/12/2016 5 min read

From accounting practice to professional services firm

A small-town firm in rural New Zealand is turning local expectations of accountants on their heads

In brief

  • At a small practice level, the model is “more of an incremental transformation, not an overnight change” than it might be at a large firm
  • Outsourcing has already shaken up the accounting industry and this has increased the need for accountants to think more strategically
  • Quality advice and expertise is where CAs are going to make the most impact for business

Photography by Walter Bibikow

Balance CA has merged with a professional services firm in order to deliver services well outside the remit of traditional accounting, including marketing and design, alongside general business advice.

“It’s playing in a completely different pond, looking at work around strategic planning, continuous improvement and all of the things that make businesses sustainable,” says Chief Executive John Taylor.

“None of our competitors are offering what we are offering. We are offering a lot more than what other accounting practices in this part of the world can offer.”

The firm has offices in Whanganui (district population 42,639, pictured above), Taumarunui (population 4,630) and Ohakune (population 1,080) in the centre of New Zealand’s North Island. Its clients are involved in industries as varied as farming, transport and tourism.

A merger last year with consultancy firm Zenith Solutions has allowed Balance CA to expand its service offering and Taylor says the market has been responsive.

“There was definitely market demand. You tend to find that in the smaller regional cities you are the strategist, the accountant, the confidant … all of those professional service-type roles.”

The model being implemented by Taylor and his team is to become a “full service provider” for clients through either providing extra support or working collaboratively with other professionals to ensure support is available.

“So we are not looking to offer legal services, for example, but rather to offer a collaborative arrangement where we work closely with legal advisers.

“It’s happening now but we want to increase that collaborative approach."

"If a client comes in and says ‘I need some advice on HR’ we can say ‘here is somebody you can speak to’. And we have total confidence that the advice is going to be good.”

There are a lot of good reasons to be in business in regional New Zealand. There are plenty of people doing great things and doing really well.


“There has been a lot of talk over the years about [the end of] compliance,” Taylor says.

“We could have sat on our hands but we decided to do something — and we didn’t want to join a race to the bottom.”

In expanding its service offering, Balance CA is following in the footsteps of the Big Four accounting firms, which have been growing business advisory, marketing and digital arms — to name a few — for many years.

“We have learned a bit from the Big Four, it would be fair to say. We are not necessarily following their model but, certainly, we have picked up on some of the things that they offer.”

At a small practice level, the model is “more of an incremental transformation, not an overnight change” than it might be at a large firm, he says.

“We have to work through this. We have to get the message across to our team that when they are talking to clients they can offer a full range of services. There will be some learning required."

A key part is enhancing the business advisory offering, Taylor says.

“[We are] moving away from being the ambulance at the bottom of the cliff to being the adviser at the top.

"Being more proactive. Working with our clients in real time rather than looking at what has happened after the event, which is traditionally where compliance has been.

“I heard the CEO of Xero say the accounting profession is facing a big threat, which was an interesting thing to say because we are still doing a lot of business – we may just have to do it differently.

With change a permanent part of the landscape, Ballance CA does not want to be left behind.

"We want to lead the changes that are occurring in this industry, in this region. We are trying to push the leading edge stuff in our region. And we are starting to get some real penetration now.”

Regional opportunities

New Zealand is “probably a two-speed economy”, Taylor says.

“There is Auckland and then there is everybody else.”

But from his regional perspective there is significant business happening, although most of it never gets talked about, he says.

“A lot of that is driven by agriculture — that is a big piece of our practice. A lot is driven by iwi [Maori tribe] settlements, the Maori world.

"We have a client which is a large Maori incorporation that employs the thick end of 100 people, they have around 200,000 stock units and they have a turnover per year in the millions. That may not sound like much to the Auckland world but to the rest of New Zealand that is a reasonably large client — and that’s just one of the clients we work with.

“There are a lot of good reasons to be in business in regional New Zealand. There are plenty of people doing great things and doing really well.”


But it’s not all rosy in the provinces. Accounting practices outside the main centre find themselves under the same pressures as their counterparts in cities throughout New Zealand – and the world – technological disruption foremost among them.

“There has been this debate around for a while that the compliance book will shrink. Technology means clients can do more themselves.

“In my view, compliance is never going to go away. It is going to be done differently and I think we will move more into the advisory space rather than crunching numbers. We just need to be aware that the shift has started.”

Outsourcing has already shaken up the accounting industry, he says, and this has increased the need for accountants to think more strategically.

“Clients don’t want to pay for just compliance work when they know it can be done elsewhere more cheaply. What they are looking to chartered accountants for, more and more, is real-time advice — ‘this is what’s happening in my business right now and I need to react to it’.”

It’s in stark contrast to the traditional model of working from financial results and their tax information from 12 months before, he says.

“Real time data — that’s the big shift. This is where we need to make more of a shift. If we don’t, we won’t be here long term. It is what is going on in their business around the numbers — that is where we need to develop our relationships with our clients.

Quality advice and expertise is where CAs are going to make the most impact for business."

Recruitment is another significant challenge in small centres — and has been for many years, he says.

“Young accountants are ending up in banks, corporate, and all sorts of roles. If you talk to practitioners in regional New Zealand you will find we don’t have a lot of people queueing up to come and work here.”

And a related issue is succession planning. The new breed of chartered accountants is bringing a new approach to public practice that doesn’t necessarily include purchasing blocks of fees or buying into an existing practice.

“CA practices, like a lot of professional services firms, have become quite expensive to buy into. Younger generations probably don’t see the world from the same perspective as our generation do, around those materiality issues of purchasing accounting practices. They are not queueing up at the door to buy what we are doing.”

Taylor says the pace of change has increased over his decades in the industry but he doesn’t believe it is too different now to when he started out.

“Has the pace of change increased? I think it has. But I don’t think it has gone from 50mph to 100mph. It’s probably gone from 50mph to 60mph.

“It concerns me when I hear people saying the industry is under huge threat. Yes, there are challenges. But are we under any more threat than any other industry? I think our clients hear that and they don’t know what to make of it. It is disruptive for us.

“I still believe there is plenty of work out here — it is a matter of how we go about doing that work. I don’t believe it will disappear, it’s just going to be done differently.

“We are going to be sitting alongside our clients advising them about their business, as opposed to about the numbers."

This article was first published in the November 2016 issue of Acuity magazine.