“If there is any game in the world that attracts the half- baked theorist more than cricket I have yet to hear of it”
The Cricket World Cup is currently underway in Australia and New Zealand (February-March 2015) so it is timely to compile a piece using cricket as a metaphor for business. Think of the game of cricket – there are 3 main parties involved the batting side, the fielding side (with bowlers) and the scorers (sorry this may upset the scorers – even some batsmen upset them: https://www.youtube.com/watch?v=G_r-l7S2U8s).
Can running a business be compared to the game of cricket?
In business you have active participants – employees and customers. In cricket you have active participants that make things happen – the bowlers and fielders on one side, and the batsmen on the other.
In business you also have parties that are not active in running the business – for example chartered or compliance accountants and solicitors. In cricket you also have a party not active in the game of cricket. The scorers – who keep the score.
Do chartered accountants perform a similar role to scorers in cricket?
Scorers only record what is happening they never give advice on what to do for the future or participate in the game.
What do chartered accountants do?
They record what has happened in the past. They do not actively participate in the game of business. So if chartered (or compliance) accountants offer business advice, I would caution against accepting such advice if they do not have business experience.
This may seem a harsh statement about accountants – let me give you an example.
We are currently renovating our bathrooms – rather boring don’t you think? No, because of the story the builder told me about his accountant made me feel sorry for him. Just under 10 years ago, his son set up a retail business. They both went to their accountant for ‘professional advice’ on how they should set up the legal entities for the business. His accountant came up with a corporate or business structure ‘on the cheap’ saving them $1,000 and making them joint directors of the new company and the existing building company.
The sad story is that the retail business failed after initially being very successful. Due to the linkage between the two companies, the father became liable for the debts of the retail venture pushing him to the brink of bankruptcy – all to save $1,000 and nearly lost his hoouse. The advice from their accountant was certainly not professional or the correct advice. It highlights the risks of compliance accountants calling themselves business advisors (or legal advisors), especially as many have not actually run a business other than their accounting practice (see blog regarding the business skills of my former accountants https://5-dimensionz.com.au/2013/08/23/deja-vu-all-over-again/). This is very risky for unwitting business owners.
Receiving business advice from a compliance accountant as distinct from compliance type accounting advice could be a risky strategy.
Do you go to a dentist if you have a sore back or a cold?
Then you should not go to a compliance accountant for business advice, unless they have the necessary experience and qualifications. Our builder’s accountant not only failed to give professional advice because he did not forsee what can happen if a business fails. Perhaps he should have recommended our builder seek legal business advice?
Enjoy the Cricket World Cup and let’s hope the scorers keep score!
Remember in business (and also in your personal life) see advice from professionals in their field……………it is less likely to put your business (or your health at risk)!