Accounting could be approaching its own RDR moment as AI, Making Tax Digital and consolidation reshape the profession, writes Richard Bertin, CEO and founder of All in Place. In this article, he explores why firms must develop deeper client relationships if they want to stay ahead.
Ask anyone in financial advice what changed their industry most in the last twenty years, and most will say the Retail Distribution Review. I think accounting is approaching its own version of that moment. This time, though, no regulator has set the date.
What RDR taught us
When RDR arrived at the end of 2012, around a fifth of advisers left. Many were good at their jobs but wedded to a model that had just been switched off. New-model firms grew, and consolidators acquired client books. The lasting lesson, though, is who got left behind. Advice moved upmarket, and millions of people were left without access to advice.
Pressure on both sides
In accounting, firms face Making Tax Digital/MTD and AI at the same time. One adds compliance work; the other rewrites its economics. Staff are hard to find and many employees are tired.
In the US, AI-backed groups are already buying accounting firms by the dozen, and UK private equity has been consolidating the mid-tier for some time now. Banks and software providers are building tax and bookkeeping into their apps. The simplest clients will go to software; the rest will go to whoever knows them best.
Business owners, meanwhile, see software doing their books and wonder what their accountant does for them. Yet they need help more than at any time in a generation. Interest rates, corporation tax, employer National Insurance and dividend tax are all higher than five years ago and frozen thresholds are dragging clients into higher tax bands.
Most owners assume their accountant sees the full picture. In reality, the accountant sees the accounts and a tax return; which shows the client’s income, not their emergency fund, savings, pensions, protection, lack of a will or a succession plan. This gap usually surfaces at the worst possible moment, with the question: “Why didn’t my accountant talk to me?”
Why accounting has the advantage
Here the comparison works in accounting’s favour. A financial adviser carries personal responsibility for every recommendation, which makes advice expensive to scale. Under self-assessment, the client is responsible for their own tax position with the accountant acting as their agent.
Accountants already run on a deep tech stack, embedded in everyday work. With the right operating system on top, a firm can do much more for each client without the same added cost in people.
Yet most firms still look for growth by chasing new compliance clients, often because they don’t know enough about the ones they already have.
Meeting in the middle
Clients need more. Accountants could do more, if they knew how and had the data and insight to start the conversation. That also means hiring and developing people for relationships, not just processing.
If the profession consolidates without closing that gap, it will repeat RDR’s mistake: owner-managed businesses left with software and nobody who knows them. The firms that work on their own business now, taking admin out and getting to know the owner as well as the company, will be the ones those clients turn to.