‘Grey accountants’ urged to keep up with the times

John Warner, managing partner at BHP, warned that “grey accountants” need to develop innovative new ways of providing services to keep up with the times.

He claimed there is scope for a large regional player as mid-tier firms like Grant Thornton, BDO and Baker Tilly jockey for position beneath the Big Four giants of Deloitte, Ernst & Young, KPMG and PwC.

“People like to deal with what they perceive as an independent business within their region,” said Mr Warner, whose firm has five offices, 230 staff and a turnover of £12m.

He added: “The modern world is such that you have to be more specialised. That’s one of the reasons behind our strategy to grow... to enable us to take on more specialists and have the top people on board with us. To do that, you need to be a bigger size.”

BHP has completed two mergers in the last three years and achieved organic growth through niche work in the manufacturing, charities and medical sectors.

Mr Warner said the group is on track to become a £15m firm, but he is mindful of challenges facing accountancy firms.

These include how BHP responds to the entry of a new demographic into the workforce – “the Millennials and Facebook generation and all the stories we hear about delayed adulthood” – and a different set of expectations about working patterns and work-life balance.

Mr Warner said there are challenges but also opportunities as the firm positions itself “not at the forefront, but shortly afterwards” on the adoption of new technology, including social media.

He said that “everything is becoming more commoditised”. Services like audit work and tax compliance are being treated as commodities so BHP has to use new technology to become more efficient and effective, he added.

“With the commoditisation of services you have got to really move emphasis more into advisory and planning. That’s our aim over the next few years,” he said, adding that the firm is building its ethical tax planning and corporate finance practices.

He said: “Clients want value for what we are providing for them.”

Mr Warner is expecting to see continued consolidation in all sorts of sectors with an increasingly international element.

“Not just regional consolidation, not just national consolidation, but global consolidation,” he said.

This applies to the professions too, he added.

Mr Warner said: “If we are selling a business now we are certainly having to consider international buyers and have been involved in five or six transactions this year where there have been international buyers. It’s a significant impact.”

BHP’s core market is companies with a turnover between £3m and £30m, although it does have bigger clients.

Its Sheffield client base is strong in manufacturing, Leeds in services and York in leisure, tourism and agriculture, said Mr Warner.

He said Sheffield’s manufacturing sector has been resilient throughout the downturn and confidence is now returning to the construction sector, but less so in retail, where smaller operators are still very vulnerable.

It has also been tough in professional services, he said.

BHP: A growing force

John Warner started his accountancy career at Barber Harrison & Platt in Sheffield in 1977.

The Owls fan studied law at Warwick University but decided to follow a career in accounting.

He has been at the top of BHP for the last six years.

The firm claims to be the largest independent group of chartered accountants in Yorkshire.

It has offices in Sheffield, Leeds, York, Harrogate and Chesterfield.

David Mitchell heads the firm’s advisory practice across the five offices.

David Forrest leads BHP’s corporate finance business.

Zoe Roberts is in charge of the firm’s tax planning service.