WOULD ANDY RAYNOR still be in a job if RSM Tenon was privately owned, rather than listed?

I guess you could also ask: if yes, then would he deserve to be?

One of the main issues surrounding the listed accountancy firm model is how to keep both the ‘partners' (technically directors) and shareholders happy.

Tenon's system of salary + bonus for its partners seems to have worked fine, and is an area Raynor has spoken of with pride in the past.

But it's one thing communicating to internal staff and keeping them happy - pushing the big picture out to the investor community is another matter entirely. Tenon doesn't seem a broken business - but it's having a tough time. The board is presiding over an impending loss, an impending restatement of accounts (lined up by relatively new CFO Adrian Gardner) - while sorting out new banking facilities. Investors are spooked.

Bear in mind that this has all come around pretty quickly, with the firm admitting its revenues can't live up to its cost base (its acquisitions of Bentley Jennison and Vantis apparently not stacking up as well or as quickly as hoped). Squeezed margins and lock-up increasing are signs of a tough trading environment - not helped by a fairly hefty insolvency division that hasn't brought in the funds like hoped.

But there are a lot of firms in a similar position or worse. Tenon posted an operating profit of £30m for 2011. I'd bet that within a traditional partnership or LLP Raynor would still be sitting tight.

But Tenon's not, and Raynor isn't. Going to the markets to raise capital ultimately leaves you at the behest of the shareholders. If they're not happy, they let you know with their feet. And now Raynor - and chairman Bob Morton - have followed them.

Oh, and a small word for CFO Gardner. It was good to see him stick his head above the parapet and talk to the press yesterday about some of the issues at the firm. Nice to see that some finance directors can brave journalists.

Read the background on RSM Tenon here.

CONGRATS TO BEGBIES for winning the "we can take on loads of administrations" prize.

Stats compiled by Geoff Swire reveal that Begbies took on 243 appointments in 2011, a cool 76 ahead of second-placed KPMG.

Of course in isolation, with neither last year's figures at hand - or the value of the work - there isn't a huge amount that can be extrapolated from the appointments data. For example, the stats don't represent that Begbies has had a tough couple of years.

But it's interesting to note that KPMG are way clear of the other Big Four firms (Deloitte 86; E&Y 73; and PwC 56).

PwC makes up for lack of quantity with quality - a certain collapsed investment bank is keeping them occupied.

Deloitte and E&Y have also had some big wins in 2011, namely Barratts and Focus respectively.

So with KPMG also undertaking some mega-jobs, how have they kept up the numbers?

The answer would seem to come from their extensive office network - wider than the other big firms. This enables them to pick up smaller regional appointments.

Good for KPMG, not so good for smaller regionals coming up against a Big Four firm. No doubt the smaller guys would look at price as a key differentiator...

FIRMS HAVE GOT a lot to think about. That's my overriding impression having attended the UK200 Group's annual conference.

You could respond quite fairly : 'So when don't they have things on their plate?'

The difference this time is that there appears to be what I can only describe as a 'perfect storm' of circumstances that will turn the profession upside down.

Where do we start?

Let's get the economy out of the way. The banking and sovereign debt crises have left little leeway in terms of access to funding, or in policy-making, to help businesses - your clients - invest and grow.

Then we have European and local pressure to ease accounts filing burdens in tandem with an audit threshold that is only ever going to go way way - up. Because of this, more practices will consider whether holding an audit certificate is worth the bother. They'll also need to seriously rethink how to retain current clients and what hook to use to win new ones.

And without statutory audit, will it be harder to recruit the next generation of accountants in smaller practices? This isn't a new concern - but it's one that's coming to a head at the moment as succession planning proves to be so painful for so many practices.

HM Revenue & Customs is under incredible pressure to keep making cuts while increasing the percentage of successful tax take. Fewer seasoned inspectors at Tax Towers means a lot more work for advisors to prove they've got clients' affairs in the right order. Moving to real time PAYE as part of cleaning up the tax credits system, plus impending new company pension rules, could see another tranche of admin passed onto accountants.

And last but not least, the firms that hedged against the downturn by expanding their insolvency divisions have found life too quiet - with suggestions that a plague of 'zombie' businesses tread the UK 's corporate landscape.

Pretty gloomy stuff, eh?

But as hyperactive business coach, and UK200 Group session speaker, Chris Hughes would no doubt say to me: It's not a bad thing to outline the problems, but what are the solutions?

There are angles of attack on all the issues I've presented. For example, PAYE and pensions changes could provide more lucrative work for you from existing or new clients.

Social media has opened up new channels to market. The conference provided lots of good examples from accountants and even *shudder* solicitors of new technology tips and tools to advance their practice.

Some firms, because of a combination of the issues already described, or other problems, will disappear. Conversely, others are looking to adapt to the new environment and emerge fitter and stronger.

My discussions at the conference with the bosses of Price Bailey and Harwood Hutton, among others, showed that there is an acknowledgement of such hurdles, and a determination to clear them. Some might argue they've already made some successful 'jumps' already.

Is the Okey Cokey the new mantra for practice management? 'Look inwards...look outwards...and shake it all about.' Maybe not, I don't see it catching on with the management consultants somehow.

What can't be argued is that it is a fascinating, exciting, and for some a worrying, time to serve in the profession.

Image credit: Shutterstock

HOW DOES A firm govern itself?

We know it's not easy. As Gary White, one of four partners involved in managing Essex-based practice CBHC, puts it, the firm ends up "run by player-managers".

The analogy works like this: As a player manager you've got to do the business on the pitch, and off it. For a fee-earning partner, it's tremendously difficult to look after clients and then make sure the firm runs smoothly. And as Gary put it openly to me: "At £3.5m revenues per year we can't justify having someone not earning their way."

CBHC's answer was to recently appoint a chairman. But to stretch the analogy to appointee Jeremy Allen - he's more Fergie than Christian Gross by pedigree and impact.

Allen spent 19 years at Dresdner Kleinwort, where his work in equity markets saw him build up an understanding of how companies differentiate themselves from competitors, and grow.

Having served as a consultant at the firm for six months, Allen helped strip out £500k in costs from the practice.

Now he will spend four days a month managing and coaching the board.

My big question was how does an outsider in this situation drive practice owners to do what he tells them to?

White says that Allen's vast experience, neutrality and already-proven record with the practice effectively makes the owners accountable to listen and act on his ideas.

"We're four equals with a part-time CEO," says White.

The importance of external advice is one I fully advocate for firms. Governance isn't the preserve of the top businesses ironically, that's what clients expect from their accountants.

Firms of different shapes and sizes will require different models to that of CBHC's. but it's surely worth considering.

Image credit: Shutterstock

GREAT TO SEE the ICAEW taking an aggressive, some might say patronising, tone in letting the Law Society know in no uncertain terms that it must not restrict the onset of multi-disciplinary practices (MDPs).

The Law Society, don't forget, is led by Des Hudson (pictured). I've always found him very amiable, feisty and determined. The ICAEW might agree - in part - with me, having received a bloodied nose from him as ICAS boss.

Back in 2005, with Des at the helm, ICAS enlisted Scottish first minister Jack McConnell to protest against the English institute's proposed change of name to the ICA.

But that's history, as much as ICAEW v Des Round Two would make for great stories.

Much more interesting is the subtext of the ICAEW's letter to the Law Society.

The institute has so far been thwarted in its efforts to extend legal professional privilege to tax advisors' clients. Lawyers will often use privilege as a USP to win tax clients ahead of accountants.

But it seems that allowing lawyers and accountants to work together in partnership will set off the next phase of the privilege battle. It seems there is concern that accountants will use MDPs as a backdoor for gaining privilege.

Whether this is true or not, pushing the society to water down any attempts to fend off lawyers and accountants working together is a smart move.

The Law Society will be on a sticky wicket if it goes against the intention of the Act by making it difficult for the two professions to work in MDPs. Let's face it, the two often work together as it is.

With the Joint Committee having already called for a review into how privilege would work in MDPs when the Act was at Bill stage, it's clear that the institute has some grounds for sticking to its guns.

It may have lost some fights, but an ICAEW rematch with Des Hudson might merely be an eliminator to take on the government for the title.

IN CASH-STRAPPED TIMES, the pressure on accountants to overstep the mark for the sake of retaining revenue streams is stronger than ever.

Maintaining objectivity and independence is key for auditors. At the highest level, firms are facing the strain of market intervention, despite their protestations that the quality of their work is in no way diluted by offering non-audit services to existing clients.

At the other end of the market Accountancy Age, professional bodies and business lobbyists extol getting as close to clients as is acceptable, providing them, their suppliers and lenders with assurance regarding their finances - and to help steer them through the travails that smaller businesses perennially face.

So I have some sympathy regarding the plight of two accountants, whose firms have been disciplined for finding themselves beyond 'ethical thresholds' of reliance on clients - or in other words, they looked after clients who represented too large a proportion of their firms' respective fee income.

The thresholds are in place to warn firms off from becoming too reliant on any one client, and prevent placing their independence at risk.

The vast majority of firms have enough on their plates holding onto clients, or being paid by those who do stay with them.

So it's a tough situation, and very tempting to hold onto the client and in your own mind believe that independence is not affected - while also trying to win other clients to dilute the existing clients' effect on overall fee income.

But for the profession to maintain its lofty status, even the smallest firms have to be strong, brave and recognise that independence and objectivity is key - the perception of the profession and its vaulted status is at stake.

It will be interesting to see how the world's biggest firms deal with this in their negotiations and lobbying to water down current EU proposals to break them up.

Whatever the outcome, will they end up with their heads held high, or give off the perception that they've merely fought to hold onto all that's dear?

Interesting times indeed.

HOW FAR would you go to help your clients?

Would you hold their hand - or go all the way?

One advisor prepared to get up close and personal is Bobby Lane of Shelley Stock Hutter.

His idea of what constitutes client service is one that goes beyond what most practices would offer - even those that consider themselves as fully attentive.

For him, advisors should do everything they physically can to enable their clients to focus on the job in hand.

As an example, Lane tells of four hairdressers looking to set up a salon. Lane and his team not only managed the tax and accounting compliance issues that arise with setting up a new business, but arranged the property lease and shopfitting.

The haircutting was left to the hairdressers.

Lane's thinking comes from his unusual background. Trained at a big firm, then into commerce in a number of finance roles, before heading back into practice.

His commercial experience has left with a strong contact base and clear idea of the help that SMEs need.

Lane feels that more practices should attempt to entice accountants back out of commerce and use them to provide a deeper range of services to clients.

Anything that advisors can do to leave clients to get on with the day job is good.

But for more practices to go down this 'complete business service' route is easier said than done, I fear.

For starters you've got a whole range of stakeholders who need to buy into the plan. The senior partner, of course. Other partners would need to let their clients loose with the newly-formed 'business service division'.

You'd then need to find the right people to do the job. Recruiters would need to be really well briefed, and even then they might struggle to get the message across to those on their books to 'come back into the fold'.

Any change is difficult to push through, particularly in firms. But I can't help feeling that Bobby Lane has the right idea on this.