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Cash is the life force of any business, no matter the size. As such, it stands to reason that when spending is out of control, cash reserves can quickly dry up—a position no business owner wants to be in.
The key to healthy cash flow is maintaining control of spending. But all too often spending occurs in silos across departments and roles, resulting in loss of visibility and control over money out (spend). This is a common pain point within many businesses, but one with a simple resolution: spend management services!
Spend management services provide a level of transparency and control over spend that helps reduce risk, drive growth, increase profits, and introduce operational efficiencies across an organization. When businesses have complete control over spending, everybody wins.
For all these reasons, BILL Spend & Expense and the CPA.com preferred partner for spend management, co-created the webinar, Spend management: A key service offering in the modern CAS practice, to help showcase this hot new service category and provide you with everything you need to know about the value of spend management.
Michael Cerami, EVP, Strategic Alliances, Business Development & Marketing at CPA.com, facilitated a highly informative discussion with several industry experts and influencers, including:
- Logan Nichol, Director of Product at BILL
- Deborah Defer, Managing Director, Business Services & Outsourcing
at BDO USA LLP - Dan Luthi, MSA and Partner at Ignite Spot Accounting Services
Topics included how today’s most successful CAS practices operate, the need for proactive (versus reactive) advisory services, new revenue opportunities with spend management services, and the positive influence of advanced technologies in delivering services with unprecedented efficiency and speed.
A quick refresher on CAS
CAS (Client Advisory Services) means different things to different people—this includes everything from foundational business process outsourcing and controllership to outsourced CFO (finance and business insights) and trusted advisor business insights.
Essentially, as a firm matures, it moves up the spectrum—evolving into proactive, data-driven, and highly lucrative advisory and insights offerings.
“The profession is at an inflection point where firms are getting more sophisticated on how they deliver CAS and their ability to serve clients in a proactive manner.”- Michael Cerami
CPA.com recently launched their new CAS 2.0 initiative, which Cerami identified as a movement toward optimizing operations, upskilling talent, refining practice strategy, and driving growth and innovation. As firms become more advanced in automating processes across functions, standardizing workflows, and using data insights to drive advisory services, they’re well positioned to launch new lines of services that clients both need and want—like spend management.
What is spend management?
To comprehend the breadth of what spend management services cover, you first have to identify and understand your clients’ core challenges around spend in general.
According to Logan Nichol, Director of Product at BILL, many business owners operate within a fragmented spend process. Think about the multiple channels and tools that represent overall spend in a typical organization:
- Personal cards and reimbursements
- Corporate cards (in the hands of few but shared with many)
- ACH bill payments
- Wires
- Cash
With various spend channels in play, it forces business owners (or their accountants) into a life of chasing receipts and manual reconciliations. The result? A major drain on time and resources.
A fractured spend function also means that businesses are always looking backwards in terms of what was spent—never really knowing what their spend is until after it happens. This pain point also extends to staff, who often have to wait up to 90 days to be reimbursed.
“You’re always looking back, looking in arrears, which means you never have full visibility into where every dollar is spent.” - Logan Nichol
For business owners to properly forecast spend and manage cash flow, they require real-time insight into spend data and a single, automated platform to manage it all.
Enter spend management advisory services and the ability to offer clients real-time visibility into spend, manage cash flow accurately (and proactively), improve approval flows, and support growth via deeper data insights.
Spend management represents a huge opportunity to further support your clients with valuable advisory services and solve this all-too-common challenge.
Technology fuels efficiency
Technology is at the heart of automated, data-driven spend management. Advanced cloud-based applications like BILL Spend & Expense enable firms to support their clients with a streamlined and completely transparent spend management solution.
BILL Spend & Expense can help clean up chaotic spend management by organizing all activity in a single system, offering:
- Cards for every employee (no more sharing)
- Virtual cards for added ease and security
- A single, organized space to consolidate spend activity
- Free and fast reimbursements
- Predefined budgets (no more looking backwards on spend)
- Full control to set spend limits per employee
- No need for expense reports
- Automated mobile reminders to capture receipts the moment the transaction occurs (no more running after receipts)
- On-demand, real-time access to data (money out)
- Automated daily transaction sync into your preferred accounting solution (e.g., QuickBooks Online, Sage, and NetSuite)
“This level of automation becomes even more necessary as we approach a post-COVID world. Travel is ticking up, more onsite trade shows are happening … representing lots of spend activity,” explained Nichol.
The right spend management technology also helps to:
- Improve security by offering employees their own corporate cards and supporting the ability to manage and track each card individually. This provides deeper insight into every dollar spent and alerts businesses to non-compliant spend activity.
- Enhance control via the ability to set limits and pre-defined budgets.
- Elevate time savings by eliminating the need to create expense reports.
- Eliminate manual tasks via a streamlined and user-friendly solution that offers automated mobile reminders, real-time visibility across all transactions, and transaction syncing.
With the right technology and standard processes in place, your firm can easily add spend management to your growing list of high-value financial advisory services.
Becoming more proactive with spend management
There’s no doubt that spend management represents a major opportunity to expand a firm’s CAS practice. It solves a long-standing challenge for business clientele—repairing fractured spend processes that result in a big drain on time and resources.
Cerami noted that spend management is less about supporting compliance-driven, after-the-fact requirements and more about weaving spend data into the larger financial advisory picture.
He explained: “It’s about recasting spend management as part of the larger business spending umbrella … it’s how we help our clients make smarter, more-informed decisions about how they spend their money to fuel growth.”
On the flip side, spend management services also offer immense value to firms. It helps to move clients away from paper source docs and into a far more efficient and easy automated process.
“I’m sure most accountants have experienced the shoebox full of receipts” explained Defer. “That’s why we’re always looking for the best tools that help our associates be proactive with clients and eliminate year-end headaches for everyone.”
Luthi added: “We are able to operate much more efficiently and spend more time with clients. We’re no longer hunting down clients for receipts. Month end is much faster, and we actually now get to be more proactive in conversations with clients about what’s happening in their businesses instead of operating in reactive mode all the time.”
Adding spend management to the conversation
Luthi believes that getting clients on board starts with a proactive conversation. He suggests taking charge of the discussion and directing the narrative with clients.
“The pandemic helped fuel an awareness around spending. We started talking more to clients about the resources they’re using, about budgeting, and about how to make money last,” said Luthi. “This created a different thought process around discussions with our clients. Today, we not only talk about budgets but also look at spending across the board to make sure the client is growing effectively.”
Defer also talks to her clients about the “no-cost factor” of using advanced spend management technology like BILL Spend & Expense. She explains to clients that not only can the firm serve them in a more proactive, real-time manner, but also that there is no added cost for using the app.
“Knowing that they don’t have to pay extra for better service is always a big selling point with clients,” said Defer.
Accounting professionals are the trusted advisors to their clients, so controlling the dialogue is priority one. It’s about leading clients in the right direction—and spend management should be part of that conversation.
Selecting the best technology
There’s no doubt that without the right technology in place, spend management would be much more difficult to support.
According to Defer, “It’s really the technologies that are driving efficiency in our office.”
As she stated earlier, BDO USA is always looking for the best tools to implement into its technology ecosystem—tools like BILL Spend & Expense that make life easier for both the clients and the firm. For the client, it’s the ease of use and feeling of control that make the difference.
Defer offered a real-world scenario: “We had a client who was hosting a retreat. One employee received a BILL virtual card and was able to buy her plane ticket and other supplies, while the employer maintained control of her spend by setting a predefined budget.”
This scenario represents multiple benefits of using the right technology: 1) the employer was able to set spend limits with the virtual card, 2) the risk of fraud is reduced by keeping spend within a single system, and 3) the employee didn’t have to wait to be reimbursed. A complete win all around.
Luthi fully agrees that technology is at the heart of successfully launching and selling spend management services. He stated:
“The goal is for clients to perform tasks in a live, more proactive space … where they can see their financial story on a day-to-day basis.”
Luthi added that using sophisticated technology also empowers employees to take charge of their own spend, which fosters a feeling of trust between the employer and staff for stronger, long-standing relationships.
At the end of the day, implementing the most advanced spend management system is critical to successfully supporting spend management services—for both the firm and its clients.
Are spend management services right for your firm?
Traditional expense management represents challenges for many business owners—including lack of visibility into spend data (resulting in reactive versus proactive financial decisions), lack of control across budgets, security of spend activity across departments and roles, and lack of automation in terms of receipt aggregation and reporting.
There is a huge opportunity for firms to offer clients yet another high-value advisory service and grow their modern CAS practice. Spend management can help solve the issue of a fractured spend function while also supporting clients with deeper data insights to better manage cash flow and fuel growth and profitability.
If your firm is looking for ways to provide deeper insights and help your clients understand and manage spend, expand your CAS services with spend management. This gives you another valuable offering clients clearly need—and one that will further strengthen the client-advisor relationship.
Ready to expand your offerings with spend management? Learn more about the opportunity, what you need to do to launch the service, and the technologies that support it by watching our on-demand webinar: Spend management: A key service offering in the modern CAS practice. Hear from a panel of experts who understand the value of the service and why your firm and clients need it.
