Luke Clark’s Post

Why should marketers give a 💩 about accounting rules ❓ The International Accounting Standards Board is currently reviewing rules about how intangible assets are treated in financial statements. And so what? Well, brand is an intangible asset and currently doesn't appear (unless it has been recently acquired) anywhere on financial statements. Marketing spend is currently normally classified as an operating expense in financial statements, meaning it is subtracted from revenue (along with other expenses) to work out profit. If brand were to be put on the balance sheet as an intangible asset then marketing spend could become capital expenditure, and expensed over a number of years. Proponents of the change argue that this would make CEOs and CFOs much less likely to slash marketing spend reactively if profits come under pressure. Plus, I think for many marketers who see brand as an asset to their business, having it recognised as such on the balance sheet would feel like a win. There are lots of questions surrounding how this would work in practice. For example, the question of how to put a value on an internally-generated brand. Plus, whether the change would actually make much difference to how marketing is treated within an organisation. Changes to accounting rules probably doesn't seem like the most sexy topic, but, regardless of your opinion on these potential changes, it's a topic area I think more marketers should become familiar with. At Marketing Week we talk a lot about the importance of "speaking the language of finance", and I think being familiar with the financial statement and comfortable with the meaning of these terms is a key pillar of that. Thanks to Ian Whittaker, Martin Deboo, and Laurence Green for their thoughtful inputs on this topic, contained in the article below ⬇

As many of you know, I have been preaching the message for several years that ‘advertising is intangible capex’ ie just as firms invest in physical capex to grow sales, so they consider #advertising and #marketing spend in the same way. However, the current accounting treatment of advertising spend - where it is fully expensed in the year - means that it can be seen more as a cost and so vulnerable to cuts. It now looks as though the accounting treatment of advertising spend may be up for revision so that investment in brands is capitalised rather than expensed (see page 5 of the International Accounting Standards Board consultation paper). If this does happen - and it will probably take time - it is likely lead to a fundamental (positive) shift in how ad spending is perceived and will make it less vulnerable to short term cost cutting. Early days but this could lead to fundamental change. As usual, this is not investment advice. Sam Tomlinson Laurence Green Rajvi Kantaria

As accountants, marketing isn’t necessarily your cup of tea. However, it’s important to know how to grow your business, and here are some tips! https://buff.ly/3w7TBvY #Marketing #Accounting #Growth

🎨 Is it time for corporate accountants to get creative? Traditional #accounting methods view marketing costs as operating #expenses, but marketing's long-term benefits, such as brand equity and customer loyalty, align more with capital expenditures. This shift could prevent underinvestment in brand-building activities, crucial during economic downturns. Developing a unified language and metrics, like ROI and customer lifetime value, is essential for CMOs and CFOs to effectively collaborate and highlight marketing's true value. Want to find out more? 👉 https://lnkd.in/geZSvBXz #Marketing #Investment #AccountingInsights #BusinessStrategy #FinancialInnovation #CapEx

Accountancy, like many professions, finds itself at a crossroads between traditional practices and the digital frontier. 🖱 As such, the way accountants market themselves has also evolved significantly. It’s not just about the numbers anymore; it’s about making those numbers work in the digital space. 🚀 So, just how should accountants be marketing themselves in this dynamic landscape? 🤷♀️ Take a read of our blog to see how you can create value, build relationships, and stay ahead in the digital curve ➡ https://bit.ly/3whhwZl #digitalmarketing #accountants #accountingfirms #marketing

Of course, you want your CPA firm to flourish, not just get by. So, how do you make that happen? Well, it begins with recognizing the challenges your firm is up against. And while each firm has its own journey, the obstacles highlighted in this Accounting Today piece are common. Whether you're contending with integrating technology, expanding your client base, retaining talent, nurturing innovation, or any other challenge, it's crucial to focus your efforts wisely (translation: don't try to do everything at once) and adopt effective solutions. It makes sense that firms would tackle these challenges by working hand-in-hand with a savvy marketing team. After all, marketers are experienced in aligning their plans and activities with firm goals. Marketing is one word that means a lot of things, and it's a good bet that marketing can help your firm not only overcomes challenges but also capitalizes on opportunities for growth. #CPA #Marketing https://hubs.li/Q02DpZCC0

Digital marketing agencies often overlook the role of finance. As agencies grow, managing cash flow and financial performance becomes challenging. A virtual CFO can provide essential support and help agencies make data-driven decisions and thrive.

Digital marketing agencies often overlook the role of finance. As agencies grow, managing cash flow and financial performance becomes challenging. A virtual CFO can provide essential support and help agencies make data-driven decisions and thrive.

Digital marketing agencies often overlook the role of finance. As agencies grow, managing cash flow and financial performance becomes challenging. A virtual CFO can provide essential support and help agencies make data-driven decisions and thrive.

Digital marketing agencies often overlook the role of finance. As agencies grow, managing cash flow and financial performance becomes challenging. A virtual CFO can provide essential support and help agencies make data-driven decisions and thrive.