How CPA Firms Can Unlock Advisory Services with Embedded Analytics: Harnessing the Power of Your Own Data

Team Ablaze Collective
September 20, 2024 • 8 MIN READ

CPA firms are evolving beyond traditional accounting and tax services. Today, many firms are embracing advisory roles, offering clients proactive insights that drive better decision-making. But here’s a secret: most CPA firms already have access to a treasure trove of data that can fuel these services—they just aren’t utilizing it yet.

With the rise of embedded analytics, CPA firms no longer need to rely on third-party data or random industry reports. The real power lies within the data they already manage from their clients’ portfolios in QuickBooks Online (QBO), Xero, and even their own internal benchmarks.

At Ablaze Collective, we’re passionate about helping CPA firms transform this data into actionable insights, enabling them to offer robust advisory services built around their own KPIs and client benchmarks. In this blog, we’ll explore how your firm can use embedded analytics to create and scale advisory services—unlocking the full potential of the data already at your fingertips.

1. You Already Have the Data You Need

Most CPA firms are sitting on a goldmine of data. Every time you manage a client’s books, prepare a tax return, or provide financial reporting, you’re gathering valuable insights into that client’s financial health. What many firms don’t realize is that this data, when aggregated across your client base, can be used to provide benchmarking and advisory services that are unique to your firm.

For instance, if you manage the books for a variety of small businesses in a particular industry, such as retail or professional services, you’re already sitting on industry-specific benchmarks that can guide clients toward better decisions. You don’t need to buy external data or depend on random, generalized reports. The data within your own practice is the key.

Embedded analytics tools, like those offered by Ablaze Collective, allow you to access and analyze this data in real time, pulling insights from your QBO portfolio and client financials to create benchmarks, KPIs, and other valuable insights that can inform advisory services.

2. Creating Custom KPIs and Benchmarks from Your Own Client Data

CPA firms can use embedded analytics to create custom benchmarks that reflect the reality of their client base. Instead of relying on external reports that may not align with your clients’ specific needs or industry conditions, you can generate your own KPIs that are relevant, timely, and tailored.

For example:

• You can benchmark revenue growth, profit margins, or expense ratios across similar clients in your portfolio, offering clients a real-world view of where they stand relative to their peers.

• If you specialize in a specific industry, you can use data from your clients to establish industry-specific benchmarks, helping other clients in the same sector understand how they’re performing against those who are facing the same market conditions.

Embedded analytics makes this process simple by providing real-time access to your clients’ financial data and allowing you to aggregate and compare across multiple accounts. This gives you a competitive edge—your advisory services are based on actual, up-to-date data rather than broad, third-party reports.

3. Turning Data into Actionable Insights

The real magic happens when CPA firms take this data and turn it into actionable insights. With embedded analytics, you’re no longer just crunching numbers—you’re providing valuable, forward-looking advice.

For instance, using embedded analytics, you can:

• Monitor KPIs in real time: Keep an eye on metrics like cash flow, profit margins, or revenue growth, and advise clients when you spot emerging trends.

• Set up alerts for key changes: Through features like webhooks, you can get instant notifications when there are significant changes to a client’s financials, such as a sudden drop in revenue or a spike in expenses. This allows you to provide proactive advice before problems escalate.

• Identify growth opportunities: Analyze trends across your client base to identify common challenges or untapped opportunities. For example, you might notice that clients in a specific sector are consistently underutilizing certain tax credits or that companies with certain expense ratios tend to perform better in the long run.

These insights empower you to deliver strategic recommendations that go beyond traditional accounting services, allowing you to truly act as a trusted advisor to your clients.

4. Offering Advisory Services Tailored to Client Needs

With embedded analytics, CPA firms can offer advisory services that are tailored to each client’s specific needs. The data you already manage allows you to identify the unique challenges and opportunities facing each client—and advise them accordingly.

For example:

• Cash Flow Management: You can use real-time cash flow data to advise clients on managing liquidity more effectively, helping them avoid cash shortages and optimize working capital.

• Profitability Analysis: By analyzing profitability across your client base, you can help clients identify areas where they’re overspending or underperforming, offering strategies to improve their bottom line.

• Cost Control: With embedded analytics, you can spot trends in client expenses and offer advice on cutting unnecessary costs or reallocating resources to higher-value activities.

The key advantage here is that all of these insights are drawn from the data you already have. You don’t need to rely on external sources or invest in costly data solutions to offer impactful advisory services.

5. Scaling Advisory Services with Embedded Analytics

One of the biggest challenges for CPA firms is scaling advisory services—how do you deliver personalized, valuable advice to every client without drastically increasing workload?

Embedded analytics offers a solution. By automating data collection, analysis, and visualization, CPA firms can scale their advisory services without adding unnecessary complexity or administrative burden. With embedded analytics, you can:

• Automate reporting and analysis: Instead of manually pulling data and generating reports, embedded analytics provides real-time dashboards and visualizations that update automatically.

• Standardize advisory offerings: You can create standardized advisory services, such as monthly cash flow check-ins or quarterly KPI reviews, that are powered by your own benchmarks and data insights.

• Deliver personalized recommendations at scale: By setting up automated alerts and customized KPIs, you can provide personalized, data-driven recommendations to each client with minimal additional effort.

This allows CPA firms to expand their advisory services without overextending their resources—offering more value to clients while improving efficiency and profitability.

6. Stop Buying Data—You Already Have It

Finally, one of the biggest advantages of using embedded analytics is that you don’t need to buy external data to offer impactful advisory services. Your QBO portfolio and internal client data are more than enough to build the benchmarks, KPIs, and insights needed to advise your clients effectively.

Many firms spend significant time and money on external data sources or benchmarking tools, but the truth is that you already have everything you need. Embedded analytics lets you tap into this underutilized resource, helping you turn the data you already manage into a powerful tool for advisory services.

Conclusion: Embedded Analytics Unlocks the Power of Your Own Data

At Ablaze Collective, we believe that CPA firms can use the data they already have to create valuable, scalable advisory services that clients need. With embedded analytics, you can leverage your QBO portfolio, internal KPIs, and client benchmarks to offer data-driven insights that drive growth, improve efficiency, and optimize decision-making.

Gone are the days when firms needed to purchase random data or rely on third-party reports. The true power lies in your own practice, and embedded analytics helps you harness that potential to deliver smarter, more impactful advisory services.

If you’re ready to unlock the full potential of your firm’s data and create advisory services that set you apart, let’s chat about how embedded analytics can help you take the next step.