DBASS Celebrates 25 Years in Business

Dermot Brennan takes a look at the highs and lows of 25 years in business

It is January 16th, 1988 and the latest edition of The Economist hits the news stands.

A special report on Ireland. Its cover features a woman and child begging on the street as a man walks swiftly by.  Headlined “Poorest of the Rich” it paints a grim image of a nation teetering close to the Abyss.  “Ireland today is bravely facing up to the consequences of a decade of borrowing to pay for better public services than its wealth justified – desperate measures are needed to right the economy.”

A great time to leave a secure well paid job with a top 10 accountancy firm to start an accountancy practice on my own on 1st February, 1988.  Truthfully, I was immune to all this doom and gloom at the time as I was fully focused on building up a successful accountancy practice and nothing was going to stop me.

I started in a small room in a client’s premises in Lad Lane just off Baggot Street in Dublin 2.  I knew I needed a trainee accountant to help me if I hoped to grow the business.

So I put my thinking cap on – it’s called planning.  In my previous job I was in charge of small business and worked with an excellent trainee who really impressed me with his work ethic and honest manner.  In conversation he told me his brother Simon was looking for a job so I grasped the opportunity as I knew if Simon was of the same ilk it was worth a try.  So Simon was my first trainee and we actually shared one desk between us in Lad Lane.  Simon obviously got one-to-one training from me and progressed rapidly into becoming an excellent accountant and one of the best decisions I have made.

And now to the risks of being self employed.

1988 was also the year of the Tax Amnesty in Ireland where if you came forward and made a Full disclosure of all prior years taxes not returned to the Inspector of Taxes, you got the offer of a lifetime by getting full amnesty for past sins by paying only 20% of the actual tax liability.  Obviously there was a huge outcry at the time from the media to letting “Tax Cheats” getting such an offer avoid paying the proper tax.

In 1988 I agreed to take over a small practice – mainly farmers and a large successful retail business.  To my horror when I started doing accounts for these clients I inherited a thing called ‘accruals’ in the opening balance sheets which meant that tax bills for earlier years were reduced because of these accruals which really were putting in expenses that never existed.  So these were ideal candidates for this amnesty.  However, if you knew farmers in 1988 they did not like paying tax and especially at 20% on overdue tax liabilities.  Also the amount of work and the strict deadline of 30th September 1988 meant I was getting up at 6:00am in the morning and back home at 2:00am the following morning – a 20 hour work shift and I did not see anything strange about this.  Naturally my body could not continue to take this punishment and I ended up in Naas Hospital in September 1988 due to exhaustion.  In fact Dr Power in Naas said she was keeping me in hospital to protect me from myself!!

Did you ever feel like this?

And now a funny true story that occurred in June 1988.

The large retail business I took over as accountant decided to move from the premises they were renting on a side street to buying their own premises on the Main Street directly opposite the bank that funded them to the extent of IR£600,000 or in todays currency €761,825.

One Monday morning the bank manager who lent this money looked out his office window and nearly had a heart attack – the premises he had funded was gone – completely levelled over the weekend by my client who wanted to build a proper new modern premises for his business.  The bank manager panicked and insisted the client change to the local established firm of accountants as he did not know who this Dermot Brennan was.  The client insisted I was working really hard for him and was not changing.

I knew however I had to protect my position so I contacted the head office of another bank for whom I was doing independent reviews and put a proposal to them to take over all the banking requirements for this business.  They were delighted to deal with this application as they really needed a successful business like this on their books and 25 years later are still dealing with this retailer.

Quite an eventful first year for the “New Accountant”.

We survived the Currency Crisis of 1992 where overnight interest rates hit 100% and averaged 40% over a period.  The business grew rapidly up to a team of 20 people and the key to this was networking and providing a very personal service.

Then the crash of 2008 hit us badly as we were heavily involved in the construction and property sector. Our turnover for the next 3 years reduced by 50% but we fought back by taking on a full time marketing person and the Partners going out on the road targeting businesses we could help.  This was very successful and we are now on a growth path.  This year we have recruited 4 new people two qualified accountants with experience and two graduate trainees.

A recession is a good time to grow your business but you have to really understand your clients and the challenges facing their business to enable you to offer the appropriate guidance and direction.