TFYW#035 Top 5 Strategies to Make This Service Profitable

May 12, 2023

This week I’ll get into a large part of how I built my firm and how to create strategies to make your CAS services more profitable.

But first, today’s tactic.

Today’s Tactic

Communication with clients is the only way to convey our value to your clients. I’ve found two barriers to good communication stemming from the Curse of Knowledge.

The Curse of Knowledge is a cognitive bias where we think everyone else has the same level of understanding as we do.

Two barriers

1. Too Complex – at times, we use jargon common to us but not understood by clients. You end up speaking over them, straining the relationship. I won’t get into this too much here, as I talk about this a lot in other places.

2. No ‘Perceived’ Value – to me, this is a bigger risk. The more we learn, the less value we think the basic stuff has. We skip over foundational information because it’s simple and ‘valueless’.

Advising clients starts with methodically adding layers of information. This may happen in one conversation (depending on how seasoned the client is), but this advising usually happens over months or years.

A client can’t grasp segmented gross profit margins by product, before they understand the basics of direct costs and gross margins.    

Selling prospects is the same thing. You already know that advisory services are important, but your client does not.

You cannot lead a client to a yes on high-priced services if they don’t understand the build up to get there.


If you don’t remember anything else from this week’s newsletter, remember this:


Your ability to sell high value services is directly related to the journey you can clearly take your client on.


There is great value in laying the foundation. Don’t skip it.

Building A CAS Offering

The fastest growing offering from accounting firms is CAS – Client Accounting Services.

CAS is sometimes called CAAS or Client Accounting and Advisory Services – but whichever way it’s sliced, it refers to services ranging from bookkeeping to advanced management reporting and advisory services.

Interest in CAS has accelerated due to improved connective tech and an increased uncertainty felt by almost all businesses.

When I sold my firm in 2021, over 55% of all engagements were CAS. It was the primary driver for the value of my firm. It offered predictable, scalable revenue AND profit.

My CAS offerings were successful because I had operations experience, enjoyed building systems and hated preparing tax returns.

I will list key strategies to overcome the biggest barriers to running a successful CAS practice.

People, Tech, and Approach

I’m going to break each key strategy down by the people, tech or approach. Understanding the role of each component makes execution more effective.

People: This is simple. Who is in charge of making this strategy work?

Tech:  Again, pretty simple. What apps or tech are being used to do it?

Approach: This is more nuanced and abstract. It is the expectation or ‘feeling’ you give around the strategy. It’s like accepting no drinks or meals on a ‘no-frills’ airline. I’ll get into this down below.

Barrier: Scope Creep

This barrier was a big issue for me when I first offered CAS. I said yes to keep clients happy.

People: You are in control here. You have to establish the requirements at the outset of the engagement. If the engagement terms are unclear, you and your team will struggle to deliver the service profitably.

Tech: Electronic proposals are a must. Set the library of services (in a tool like Ignition), and do not alter the detailed expectations for your services.

The expectations should be the same for ALL clients. I know some clients may pay more but special treatments are impossible to manage. Varied expectations across your client base lead to poor client experiences.

Approach: Be detailed upfront, so you don’t have to ultra-detailed (finding emails or text messages about expectations) if things go sideways. Include details about expectations, tasks and deliverables.

Listing additional fees for out-of-scope work is not rude – It’s business. You are not doing your client a favor for not charging an extra couple hundred bucks. The favor is delivering them high value work that they are paying for.

Barrier: Waiting on the Client

A recurring engagement requires you to depend heavily on your client’s involvement. It can be disastrous if the client is not managed correctly.

People: This may seem like it is up to your team who is doing the work, but it’s not. This is up to you, the engagement leader.

Much like the scope issue, you must define the time allowed from initial requests to receiving the document (ie client delays). Write the particulars into the engagement letter. Be specific.

Tech: Your tech will not save you with this barrier. I am a huge fan of reminders (I live by the reminder app on my phone), but you shouldn’t have a complex system of elaborate reminders, poking, or SMS messages to get your clients to do stuff.

It is a failing relationship – NOT A TECH ISSUE – if you send two reminders and your client does not respond. Cut the client loose if they are working with you.

Approach: The biggest CAS hack is not a tactic or tool. It is the approach and confidence you have in your engagements. Let your client know that this is a two-way relationship, and that you won’t wait on them.

Your reporting package should include a snippet of your relationship status with them, whether that is transaction volume, response times, or any other metric defined in the engagement letter. Any overage needs to be highlighted immediately.

Barrier: Admin Time

At times, I enjoyed doing administrative work. It was less taxing on my brain. Admin work, however, is the silent killer of CAS engagement profitability.

People: Again, this is on you but executed by the team. You need to invest in workflows and tech to ensure that your team doesn’t have to slow down for administrative tasks.

Tech: There are a few things that create a crazy amount of admin time if not prepared for:

1. Anything for the client to sign. You should never send a pdf or word doc for the client to print, sign and scan back. Either use Ignition App for engagement letters, or if you want to create pdf documents for esigning, you can use Hello Sign or Adobe Sign.

2. Anything for the client to pay. Monthly recurring arrangement are the gold standard. This requires a fixed fee (you can bill for out scope work independently) and yes, some months, your margins may be slimmer, but as your team becomes more proficient and you train your clients, margins will grow. Ignition App is a favorite, but I know firms that are using Proposify and good ‘ol QBO.

3. Anything for the client to fill out. Invest in a secure web form builder to collect information. I had stand-alone forms for almost everything I would request from a client. Even if the form has only two fields in it, clients will respond faster when there are forms to drop data into. Jot Forms and Type Forms are popular. I love Gravity Forms, but it requires a WordPress website and a bit of know-how.

Approach: External-facing automations are a better investment, at first. Automating internal tasks will save hours of work, but automating client-initiated tasks will save days of work.

Your internal team may be doing a manual task, but the more they do it, the more efficient they will be.

When clients repeatedly do manual tasks, they rarely get faster at it. Clients remember how to complete monthly bookkeeping requests like they do the password they set up for a vacation rental in 2019.

Barrier: Not Adding advisory Services

This is something that I initially missed in my CAS practice. Businesses need things to be done, but they also need and will pay for good advice.

People: You probably already guessed it – Yes, this depends on you. Adding advisory services is harder to do once you have already been engaged for simple CAS services. So I recommend leading with advisory services when you get on sales/ discovery calls with your clients.

Tech: Leverage your proposal app (Ignition or Proposify) to show the tiers of services you offer. Again, tiers shouldn’t be based on volume but value.

A tool to show the different tier values is powerful. It puts the choice in the hands of the client.

Naming the tiers something different than Bronze, Silver, and Gold is important as well. I like ‘Maintain’, ‘Grow’, and ‘Transform’ as they speak to their experience and communicate the increasing value.

Approach: Value is not determined by what your hands can do, but by what your brain can think. Advisory services are not actions you do but directions you give.

Once you sell your clients on the directions, all the work (bookkeeping, projections etc.) needed to get there is an easy add-on for the relationship.

Barrier: Disconnected Tech Stack

The client’s accounting system is part of a network of apps and tools. You need to know or plan how to connect them to make the data flow.

People: This is on you. The discovery call must uncover the tools they are using in their business. The bare minimum is that they are on an accessible cloud accounting system, but true cloud systems like QBO or Xero are best.

The next requirement is what are they using to run their operations, track hours, send invoices, pay vendor payments etc.

Profitable CAS requires a holistic approach to their finances and systems.

Tech: This is a bit of a mixed bag. There are 1000s of small biz apps that clients could use. The fortunate thing is that APIs and connectors like Zapier and Make have made connecting tools much easier.

In some cases, clients are using archaic or manual processes. By suggesting and implementing a tech solution, you can improve their business AND increase your margins. Win-win.

Approach: These days, using and understanding technology is as important as knowing that an increase in cash is a debit.

Learning your client’s tech will take time, but the return is significant. In the next few years, non-tech-centric CAS firms will not be able to compete. Period.

Today’s Tech

The list of ChatGPT and other generative AI products is growing every day. While some tools are cool, use cases for accountants are few.

I discovered ChatPDF, which allows you to interact with PDF documents (contracts, tax code interpretations, articles) in a more productive way. You can quickly leverage an assistant to summarize, highlight and organize data from a PDF.

  • Go to ChatPDF
  • Upload a PDF, search a URL, or find a PDF online.
  • Create an account Free account to save your sessions.
  • Once loaded, as the AI questions.
  • You can use formatting prompts to get the results in a table form, or bullet points (a more digestible format to share with clients)

Last week, I used this tool to do a bit of research on the by-laws of a non-profit organization that I am a board member for. The responses were good. Not only did the AI cite the pertinent sections, but it also explained the sections for better clarity.

Is this a replacement to remove you from interpreting dense/lengthy information? No, but it can get you 85% of the way there, so you can focus on the most valuable work/analysis.

Build The Firm You Want!



P.S. Email with something that you want me to talk about. I’ll add it to the list. 

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