A step-by-step guide to starting a new CA firm


Work independence, the flexibility to choose clients, and specialised services are some of the primary reasons for CAs to establish their own entity. Changes in the taxation regime coupled with new opportunities provide the ideal platform for CAs to start their own venture. If you too, are contemplating starting your own CA firm, this guide would help you in your journey.

Create a solid business plan

One of the fundamental pillars of any successful venture is a robust business plan. While creating a business plan you must:

Define your values

Defining your values encompass the mission and vision of your firm. For example, you might want to help your clients with the understanding of international taxation norms in case he/she is looking to venture abroad or provide guidance on finer aspects of GSTand enterprise risk management. It would also help you know your USP, essential for building meaningful relationships with clients in the long run.

Know your target domain

The complexities of modern-day business have opened new avenues of service for a CA. While earlier the focus was only on audit and taxation; today, CAs with knowledge in mergers and acquisitions, business management, enterprise risk management, international taxation, forensic accounting, etc., are in high demand. Hence, it’s essential for you to know the service(s) you would want to provide.

Create a client and pricing strategy

Once you know the service(s) you would like to provide, it’s important to chalk up a client strategy. In the digital era, it’s imperative to have a website and robust social media presence to make deep inroads and acquire prospective clients. Research suggests that the concept of virtual service provider will generate 40% of income for professionals.

At the same time, it’s essential to have the right pricing strategy in place. You can either opt for a one-time fee or a performance-based fee. While cost-effective services are preferred by clients, you need to ensure that the price you set helps you meet working capital needs of your venture in the long run.

Analyse your financing options

Setting up a CA firm requires a substantial amount of money. The costs of acquiring an office premise, having the required infrastructure, buying new machines, installing software can easily cost you several lakhs of rupees.

While you can liquidate your savings to avail funds, it’s prudent to opt for external financing since it helps you with a larger amount of funds. Also, with the evolution of non-banking finance companies (NBFCs), it’s easier to avail financing than before.

Break up your costs, make projection of cash flows

It’s essential to break up your costs while setting up your own CA firm. The cost break-up can be expenses incurred for:

  • Buying/renting office space
  • Setting up the required infrastructure
  • Installing the desiredsoftware
  • Deploying cybersecurity solutions
  • Hiring employees
  • Marketing

You also need to have adequate finances to address unplanned expenses that might crop up while setting up your own firm.At the same time, projection of your cash flows 3-4 years down the line would give you a holistic view of your finances and help you better plan your finances.

A customized Business Loan for Chartered Accountants from Bajaj Finserv helps your CA practice meet various costs. Equipped with a Flexi Loan facility, you can borrow funds as and when required from the approved loan limit. Also, with interest being charged only on the amount utilized, it lowers your EMIs and helps in easy repayment.

Moreover, it is a collateral-free loan. Therefore, you do not need to pledge any assets and the paperwork is also minimal.

To know more about a business loan for Chartered Accountants, click here.

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Guest 
on 30 November 2018
Published in Career
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