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IFAs must overcome culture clash to win over accountants

by Michelle Abrego on Nov 09, 2012 at 13:05

IFAs must overcome culture clash to win over accountants

Advisers looking to partner with accountants need to be aware of the cultural differences between the two professions, according to Paul Lothian co-director of Dundee-based Verus Wealth.

Lothian, who has a joint venture called A2+B Wealth with an accountancy firm in Aberdeen, said accountants were often introverted thinkers and accustomed to a more corporate culture, compared to IFAs who were more extroverted and had smaller businesses.

‘The accountant archetype is typically in the introverted thinking space and that will present challenges if you are not naturally like-minded,’ he said.

He said adviser had to overcome a number of challenges when building links with accountants including the negative perception of the profession, and accountants’ suspicion of advisers’ charging structures, as they were used to being paid on an hourly basis.

Lothian said that the best way to approach an accountant was to be professional, make a strong business case, present a clearly articulated client proposition, and show letters of recommendation or testimonials from clients.

‘You need to be patient, don’t be pushy….give them the details, be prepared and organised, be punctual, deliver on time what you promise and keep it formal and business like,’ he said.

3 comments so far. Why not have your say?


Nov 09, 2012 at 13:58

Started a JV with an accountacy practice in 2007. Well worth it as it gives you access to a good client base and a number of contacts in the corporate market.

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Greg Thomas

Nov 09, 2012 at 15:36

Obviously news takes a long time to travel up to Dundee. Or perhaps the ICAS have different rules. But accountants can now become AR's of SJP.

Oh, and they don't consider IFAing to be a 'profession'.

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Julian Stevens

Nov 11, 2012 at 14:05

I've always found it very difficult to establish any sort of dialogue with accountants (or solicitors, come to that). There are many reasons:-

1. They're already constantly being approached by all manner of other financial services firms trying to do the same (not least DSF's),

2. some have had bad experiences in the past with firms claiming to offer a professional service that's turned out to be nothing more than just flogging products,

3. many already have relationships of long standing with firms that do offer a professional service, so they don't need anybody new and

4. too large a proportion of the financial services industry generally doesn't (yet) warrant consideration as a profession of equal standing with accountants and solicitors.

But just last week I received from a will writing colleague a referral to an accountant who's a director of his own practice and who wants life insurance, specifically Relevant Life Insurance. The attraction, of course, is that he can do it through his business and claim the premiums as an allowable expense. So there was my route in ~ I can offer him something to which, as a tax planner (rather than just someone who just prepares a set of accounts every year which, I have to say, is all that many accounts seem to be), he can directly relate. It fits in with the way he thinks.

Happily, we hit it off right from the word go and I built on this by explaining how commission for the sale of investment and protection products will soon be going, to be replaced (as we know, but which many people out there in the wider world still don't) by an agreed charge for advice. As an example of what this means, I explained that the Adviser Charge won't (in theory anyway) be based on the size of a particular investment but on the work done and the advice provided as to the suitability of that investment, be it £100,000 or £500,000. That too struck a positive chord. On top of that, for good measure, I mentioned that much of the work we do is analysing and reviewing existing portfolios as opposed merely to recommending new products. Again, this is more in line with the thinking of someone whose whole mind set is oriented towards the provision of fee-based professional services as opposed to the sale of commission-based products.

So, with a bit of luck, apart from a quite large life insurance policy on himself, he may well be referring me to one of his clients who apparently is a successful businessman but who, in getting there, has neglected his financial planning on all other fronts.

Of course, the first big hurdle of actually getting in to see an accountant or solicitor with a view to having that important first conversation remains. But, if we can manage to clear that hurdle and get past the door, I think we'll have a better story to tell about what we do, how we do it and how we charge for it.

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