The Private Practice Success Podcast

4: Why you need a 3-Scenario Accountant

• Gerda Muller • Episode 4

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Join Gerda as she dives into the nuances of choosing the right accountant, sharing valuable insights that can help you turn your financial management into a strategic advantage.

Whether you're re-evaluating your current accountant or starting fresh, this episode provides the guidance you need to make informed, empowered decisions for your practice's future.

In this Episode, you'll learn (amongst others):

  • The critical role played by your accountant, beyond mere compliance.
  • How to identify if your current accountant is meeting your needs.
  • The concept of a "3-scenario accountant" and why it matters.
  • Strategies for effective communication and partnership with your accountant.
  • The importance of maintaining control over your business decisions.

Who This Episode Is For:

  • Practice owners ready to take control of their financial decisions and build a strategic alliance with their accountant.
  • Allied health professionals looking to enhance their business support network.
  • Anyone interested in improving their financial literacy and business strategy.


Special Bonus:
DOWNLOAD Gerda's guide for choosing the right accountant for your business. It contains 30 critical questions for you to ask any potential accountant that you might want to work with. You can download it HERE.

Connect with Private Practice Success & Gerda here:

Well, hello there, amazing private practice owner. My name is Gerda Muller, and you are listening to the Private Practice Success Podcast. And this is episode number four. And today I'm going to share with you my thoughts on why you need what I'd like to refer to as a “three-scenario accountant.” I hope you are intrigued because this is really interesting. 

From Compliance to Growth: 30 Questions for Interviewing a New Accountant

Now, before we dive into today's episode, a quick heads up: in the show notes of this episode, you will find a link to a document that I specially compiled for you. Within it, you will find a list of 30 questions that you can ask a potential new accountant. I know that getting the right accountant is a big decision, and you might go, Well how do I know when I'm going to find the right one? 

So, I'm trying to make it a little bit easier for you, and I've listed down 30 essential questions that I would recommend you ask a potential new accountant as you go through this process. Now, 30 might sound like a lot of questions, but all of it might not be relevant to your business. So really, print it out and highlight the ones that apply to your business.

Then when you're going into a meeting with a potential new accountant, you will know what questions to ask. And based on their answers, that will help you make a decision as to this is going to be the right accountant for your business, or not. 

All right, so let's get stuck into this really juicy topic.

How the Right Accountant Changed Everything for Me

So having the right accountant is extremely important. Since I started my private practice back in 2007, I have gone through three accountants.  So, I guess I've gone through two, and I've been with the third one for more than 10 years now - it’s actually 12 years this year. So back in 2012, when I first started working with my business coach, one of the fundamental conversations that we had that really changed the trajectory of my business was around having the right accountant. 

At that time, I had an accountant that was doing a good job. But what I realised is that that accountant was being what is referred to as a compliance accountant or a tax accountant. In other words, this person was making sure that I was dotting all my i's and crossing all my t's in order for my business to be compliant when it comes to tax and all of those interesting things, which is perfectly fine. You need to do that.  You most, certainly 100% need to be tax compliant. 

But that's only one part of the financial aspects of running a successful business, and that’s only one part of what an accountant should be doing for you. Now, if you don't want to pay a lot of money towards an accountant, that's probably the type of accountant that you're going to have. So, compliance accountants are going to be way cheaper than what I like to refer to as a “three-scenario accountant.”

So, at that time, I then left that accountant, and on the recommendation of my then business coach, started working with my new accountant, which is still my current accountant. And it just basically blew my mind. I did not know that I could get the level and type of support from an accountant that I got from my new accountant. So, yes, the compliance was still there, but I finally had an accountant that was in my corner. An accountant that was really interested in and invested in my business and the success of my business. 

So much so, that I often left meetings with my accountant thinking, “Oh, my goodness, this person has a bigger vision for the business than what I have.” They are painting this amazing vision of what I can achieve, and that feels really empowering - having somebody in your corner that believes that you can do great things. 

And that is the type of accountant I have, which is why I am extremely loyal. Not to a fault, I would say. I'm loyal because of all these things that I get from my accountant. And because being in a meeting with them is always empowering. Yes, we often have the difficult conversations that are needed to be had. They are not trying to compliment me, or you know, try and stay on my good side. 

They tell me the reality of the data that I need to look at, but they always have a solution, and they always have a plan, and they always have a vision and they can paint that picture as a future that they can see, which is really, really great to have. And that’s the type of accountant that I want you to have in your corner. 

I clearly remember one incident where I was actually buying a new car. I was sitting at the dealership doing the paperwork and I had to take out a chattel mortgage - I think it's called. Anyway, it's a loan to pay for your car. And they were asking me these random questions, and this was like quite a number of years back now. “What's the ABN. What's this? What's the this, what’s the that?” And I didn't have all the information on me, so I thought, I'll just call the accountant. So, I gave him a call and I was just asking him these questions. 

I didn't say “Hey, I'm sitting at the dealership and buying a car.” I just say “Hey, can you just tell me A, B and C?” And he said, “What are you doing?” And I said, “I'm buying a car,” and he goes, “What? Without checking with me?” Not in terms of that I need his permission, but he wants to help. I said, “Oh, I didn't know that this is something that you could help me with.?  And he went, “Put the guy on the phone.”

So, I handed the phone to the person doing the loan paperwork, and he and Will just had this conversation. And Will negotiated an amazing rate for me, which I would most probably not have been able to negotiate. And the guy just puts the phone down and he said, “Nope, it's all sorted.  I've got everything that I need. This is what we’ve arranged. This is how it's going to work. “

And it's like, “Oh, my goodness. That was so easy.” Now I know what to do next time I want to purchase a car. But I also learned from that experience; the next time, it was so much easier. So, that is the type of accountant you want. First and foremost, he answered my phone call, right? And didn't have to make an appointment. He just got in there and he did what he needed to do.

The 3-Scenario Accountant

But let’s spend some time talking about this three-scenario accountant. And this is just a term that I made up, because this is what happens to me when I do my tax planning with my accountant. Every year, normally it’s March or April - normally at the latest, April. I will have the annual tax planning meeting with my accountant. And when I was still in Brisbane, I used to go into the offices and we would have a meeting and we would go out for lunch afterwards, that type of thing. 

These days this just happens over Zoom because I live seven hours’ drive away from Brisbane. And they still do it the same way, even now, after all these years. So, they would, you know, go through all the books. They would do projections in terms of what they think the books are going to look like come the end of the financial year. And then they present me with three scenarios. 

So three scenarios each, which will have a different tax implication and therefore a different financial outcome for my business. So, you need to ask yourself this: when you have your tax planning meetings with your accountant, do they offer you three scenarios? Or do they offer you just one? Maybe they offer you two. Like mine, offer me three scenarios, and I tongue in cheek refer to the three scenarios as follows. 

Scenario One

So scenario one is basically going, “Gerda, if you did your own tax planning, this is how much tax you will be paying.”  And then they give me scenario two. 

Scenario Two

So they go, “Okay, so if we do this, that and the other, this is what it will look like.” And again, tongue in cheek, I refer to that as scenario two being, “If you went with a regular accountant, Gerda, this is what your tax would look like.” 

Scenario Three

And then the pièce de résistance (or whatever the term is) is scenario three. Which is, however, because you do business with us, this is the tax implication. And that is scenario three. 

So, Scenario three is when you have the best, most amazing accountant that knows what they’re doing. That yes, make sure that you are 125% compliant. But they have also made sure that they have optimized what they can, of course, within the law, to ensure that you do not pay more tax than what you need to pay. Because I’m sorry to say, but I don’t want to pay tax that I don’t have to pay. 

I will pay every dollar that I owe. But that’s the only tax that I want to pay. Needless to say, every year I approve scenario three. And it’s actually really good for me as a business owner, to see the difference in scenarios and the different things that they do. And as a result, I’ve really upskilled my own financial literacy. 

So, every time I do this tax planning meeting, I learn so much. Because each year there’s something different that has happened over the last 12 months. Whether that is external variables, variables within the market place, stuff that’s happened internally within the business. So, I absolutely love having those meetings. I’ve also come to learn that when I’m having my tax planning meeting, I should not book anything else on that day. Because I am literally done afterwards, because I’m not a natural numbers person. I most certainly appreciate looking at the numbers, and I even more appreciate what the numbers can tell me. Because the numbers inform strategy, and it informs decision-making. 

And when I make decisions based on data, I know that my decisions are going to be more accurate because it’s based on objective information. I’m not saying that I don’t make emotional decisions every now and then; I most certainly do. Personally, I believe that the best decisions are made with a great base and foundations in data, and then plus the heart and the gut feeling on top of that. I believe that you should never not trust your intuition, but you have to start with the data. And that’s what I get on those days. So, I’m normally done for the day afterwards. And then I take like an extra day or so just to process all the information. But it’s always a great experience. 

So that is what I refer to as The Three Scenario Accountant. And if you don’t have one of those, then I highly encourage that you start looking for it. Or, if you’ve got a great accountant, I’m not saying jump ship -  that’s not what I’m saying. But maybe what you can do is have a conversation with them in terms of going, “Hey you know, I love the service that I’m getting right now, but is there a next level of service that I could potentially tap into?”

What does that look like? I’m guessing a lot of times accountants might think that as a small business, you want to limit your costs, right? And therefore, they might not tell you about what other type of services they offer, which is a mistake on their part.  Maybe they need some business coaching. But I’m thinking that this might happen. 

Communicating Your Needs with Your Accountant

So, in the first instance, before you decide to just, you know, leave your accountant, speak to them about it. I think if you’ve developed relationships with an accountant and, you know, they treat you well and the customer service are good for the level of work that you require from them, have a conversation and tell them that you would like something more. That you would like, you know, additional support up the tax planning, all of that type of stuff. 

Something that I’m thinking of now: one of the things that my accountant does, and he did it even before I thought of doing it, he drew up an amazing A4 diagram setting out all my company structures. The trusts, the ABNs, the tax file numbers - everything. So, whenever I now get asked by the bank or whatever for that type of information, I just go to that one page document that he set up for me. Like, I don’t ask them to do it. They just did it. It is so cool. So that is the type of accountant that I would like you to have as well. 

Now you might be thinking. “Oh, Gerda, how much does it cost then? How much are you paying for that level of service from your accountant?” Well, I would say that most people will probably say that I pay a pretty penny. If I share with you how much I pay right now, at the time of recording this in 2024, I pay just under $2000 a month for my accountant. Now, you might’ve just fallen off your chair. Please do not be concerned. I think this is actually a very reasonable rate, because I’ve got multiple structures. 

So Private Practice Success Australia is a company, so that’s a PTY Limited Structure. However, the two practices have a trust and company setup. So, each of my practices run as a separate legal and therefore financial entity, and each practice has a trust and a company, with a company is the trustee of the trust. So, there’s two sets of costs involved there. 

Then that rate also includes the personal tax for both myself, my husband and my daughter. And as of next year, will also be my son once he starts to hopefully earn some money. So, all of that is included in that investment. And it is 100% an investment. And I pay it with pleasure because I can tell you, when I look at scenario one, two and three, they are saving me that money plus way more, in terms of return on investment. And that is what you want to look at. 

It's not about looking at these things as an expense. You need to go, “What return am I getting on this? If I’m investing this money, what is the return I’m getting?” It’s the same with all your expenses, even your wages. If you are investing money in clinicians, what’s the return on that investment? If you are investing money on rent, what is the return on that? And all businesses have operating expenses. I think it would be really hard to run a business without having operating expenses. And it’s very easy for people to go, “Oh, it’s easy to save money on an accountant. I’ll just go, I’ll do my BAS best myself. I’ll do you know; I’ll just work that out myself. It’s fine with the tax. I know how to manage it. 

No, you don’t. You don’t know. And you shouldn’t expect yourself to know all these things. It’s really important to acknowledge that you can’t be the expert on all things. And for the majority of us, we trained as clinicians, first and foremost. I trained for six years to become a clinical psychologist. Yes, I had some business training when I did my travel and tourism degree. Before I even studied psychology and I worked, you know, whilst I was studying psychology and I worked in business. But I never studied to be an accountant. So, I will never know the intricacies of being an accountant and how to apply that. But as the business owner, I can most certainly engage an accountant to provide me with the right level of support. So, your accountant is really part of your business support team. 

What I will say is that your accountant does not replace your business coach in your support team. Each of those parties plays a different role. If you are a solo practitioner, the other essential person that you have also, for example as part of your business support team, is your supervisor, your clinical supervisor. So, it’s important to go, “Who is part of my business support team? What is the role of each of those people within what it is that I do?” And one of the things that I often hear from people, especially when it comes to the accountants, is that they put the accountants on a pedestal. And they go, “I can only do certain things once my accountant has actually said yes, that’s okay.”

And I don’t operate like that. If you do and if it works for you, brilliant, right. But nothing annoys me as much when somebody tells me, “I’m going to have to check with my accountant.” It’s like, I love that you want to check with your accountant, but at the end of the day, you are the boss. The accountant works for you. They are providing you a service. It’s your job to go yes, to go and check with them. With the emphasis on check, not ask permission, not gain approval. But to say, “Hey, this is my plan. This is what I want to do. This is how much I think it’s going to cost. Maybe this is how much I want to invest. This is what I think is going to be the outcome etc., etc.” And then it’s the accountant’s job to give you objective input and to give you their advice. But at the end of the day, the decision needs to be up to you. 

Partnering Effectively with Your Accountant

So, to be clear, the bit that annoys me is when business owners abdicate decision making to their accountant. Instead of taking the input that they've received from the accountant, and making their own decision. Because ultimately you are the person in charge of your business. You are the person responsible for the outcomes. Even if you follow word by word what the accountant says and things do not work out, you cannot blame the accountant because you decided to follow that advice. 

So ultimately you need to know that the decision is yours to make. It's not an easy way out to go, “I don't know what to decide, so I'm going to get the accountant to decide for me.” Yes, they need to give your recommendations and input, but you need to decide. The accountability is yours. The buck stops with you. Very, very important. Similarly, when I'm working with my mentoring and coaching clients, I might give them input. People come to me with problems very often, or they come to me going, “I want to scale my business. How do I do it, Gerda?” And I will give them input. I am very mindful of what people ask from me. 

Are they asking for coaching? Are they asking for mentoring or are they asking for consulting? I do find that a lot of the clients that I work with want consulting, which means they want me to tell them what to do. And I'm happy to do that, right? I'm happy to go, “Okay based on all this information that you've shared with me, this is what I think we need to do.” However, it's up to that client to decide whether they want to implement that or not. Okay. It's not my decision. I can say, “Here, this is what I think is the answer,” but you can decide what bit of that you want to implement, all of it, or maybe just some of it. And at the end of the day, whatever you decide to do, I will have your back. Even if it all falls apart because you made a wrong decision. I will be there with you to help you pick up the pieces. And I will not be saying, “I told you so.” I find that clients actually tell me, “Gerda, you told me so.” And I will just go, “We're not going there. What we need to do now is fix this.” 

And the same needs to hold true with your accountant. And that's what I love about my accountant. I can go to him and say, “Hey, I want to do A, B and C. And they might say, “No, we think you need to do X, Y, and Z.” And I can be very strong willed, let me just say that. And I would go, “Nah, I still want to do A, B and C,” and I will. We'll do it. And you know what? They will have my back.  Even if they said that's not going to work, I will go, “Okay, now that we've agreed that I still want to do A, B and C, I need you to work with me to come up with a plan to make this happen.” And then we do that. 

And I think because I am confident in what I want in my business, I've often pushed my accountants outside of their comfort zone. And often, when you push people out of the box, they come up with the best, most brilliant ideas. So, I want to challenge you to think outside the box. And to encourage your accountant to also think outside the box. And to always know that at the end of the day, the person in charge of your business, is you. But that person also needs to make sure that they have the best business support people around them. 

So, my wish for you is for you to also gift yourself what I like to refer to as The Three Scenario Accountant.  That is where we are going to leave it for today.  Thank you so much for tuning in. 

And as always, remember that I am here to help you build a practice, you can't stop smiling about.  😊

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Gerda Muller

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