Blog · Board and management reporting · Tax and accounting
The ten practice KPIs a tax or accounting firm should run on, each with its formula, the export it comes from and what it tells you: service lines per client against the norm, fee per client against the norm for its size, season watch, deadline load per manager, advisory triggers acted on, realisation by client, client retention by fees, lock-up by client, scope creep on fixed fees, and new client onboarding time. Also the three measures most firms miss, the figures to drop, the identities, and who owns what.
An accounting firm's work arrives on a calendar, from clients whose fees were set years ago, and the accounts it prepares contain the signs of the advice those clients need. The measures that matter use all three.
| # | Measure | Formula | Export | What it tells you |
|---|---|---|---|---|
| 1 | Service lines per client against norm | Service lines with fees ÷ median for clients of the same type and size | Practice management; billing | Compliance-only clients who need more |
| 2 | Fee per client against size norm | Annual fee ÷ median fee for the client's turnover band and complexity | Billing; client master | The under-priced book, ranked by gap |
| 3 | Season watch | Clients whose records, start or draft are later than their own usual date by more than a stated margin | Workflow dates, current and prior years | Late clients and quiet departures, early |
| 4 | Deadline load per manager | Hours of work due per week, per manager, against hours available | Filing calendar; budgets; capacity | The crunch, weeks ahead |
| 5 | Advisory triggers acted on | Triggers with a logged conversation within 60 days ÷ triggers found | Client accounts and returns; CRM | Advice the data called for and nobody offered |
| 6 | Realisation by client | Billed ÷ time at standard, per client, with trend | Time and billing | Fixed fees that no longer cover the work |
| 7 | Retention by fees | Prior fees of clients retained ÷ prior fees; losses by reason | Billing | Whether the clients leaving are the large ones |
| 8 | Lock-up by client | (Work in progress + debtors) ÷ average daily fees | Ledgers | Clients the firm is financing |
| 9 | Scope creep on fixed fees | Hours on work outside the engagement letter, per client, billed and unbilled | Timesheets with work codes | Extra work given away |
| 10 | Onboarding time | Days from engagement to first deliverable; information requests outstanding | Workflow records | New clients stalling before they start |
Every one of these is computed per account, per manager and partner, and in total, and every one carries an identity that must hold before the table is shown.
Fee against the norm for size. Fees are reviewed client by client, by the partner who set them. Nobody ranks the whole book against its own median.
Advisory triggers. The firm prepares the accounts, files them, and moves on to the next client.
Deadline load by week. Everyone knows January is busy. Few know that manager C has 40 percent more hours due than available in the third week.
A client with turnover of $4 million pays $6,500 a year. The median for the firm's clients in that band is $12,000. Time recorded last year was worth $13,400 at standard rates: realisation of 49 percent. This year's accounts show turnover approaching the audit threshold, a second entity formed, and a director's loan of $180,000. Three advisory triggers, an under-priced engagement, and no conversation logged since the last filing.
Chargeable hours per person, alone. Hours on under-priced fixed fees are busy and unprofitable.
Number of clients. A payroll-only client and a group audit count the same.
New clients won, without onboarding and first-year realisation. Some wins cost more than they bring.
| Table | Must hold |
|---|---|
| Realisation | Time at standard = billed + written off + work in progress |
| Deadline load | Filings due = filed + in progress + not started; every filing has one manager |
| Retention | Opening fees + new − lost ± fee change = closing fees |
| Triggers | Found = acted on + declined + open |
A table whose identity fails is a table with a row missing or counted twice. It is not shown until it is fixed.
| Measure | Owner | Reviewed |
|---|---|---|
| Season watch; deadline load | Managers; operations partner | Weekly in season |
| Advisory triggers; onboarding | Client managers; partners | Monthly |
| Realisation; scope creep; lock-up | Partners; finance | Quarterly |
| Fee against norm; service lines; retention | Managing partner | Annually, before fee letters go out |
A measure with no owner is a metric, not a KPI; see KPI versus metric versus measure.
Ten measures from the practice system, the calendar and the accounts the firm already prepares. Price against your own norm, read the triggers in your own work, and see the deadline load by week. Covirage computes all of them from the exports accounting firms already produce, files only, with the definitions stated and the identities checked. See Covirage for tax and accounting firms.
An event in a client's own figures that calls for a service: turnover crossing a registration or audit threshold, a director's loan growing, a new property, a loss-making year, a second entity, overseas income. The firm sees these first, in the accounts and returns it prepares. Listing them per client turns compliance data into an advisory pipeline.
From the firm's own clients: fee against turnover band, entity type, transaction volume and number of filings, using the median for well-priced clients. A client paying half the median for its band has usually been with the firm for years on a fee nobody revisited. The list is ranked by the gap in currency.
It compares each client's progress this season with its own usual dates: records received, work started, draft issued. A client that normally sends its records in the first week and has sent nothing by week five is either late, which squeezes the deadline, or has gone elsewhere. Either way the call is made in week five, not week twelve.