The Practice of Now survey has been capturing the thoughts and feelings of accounting professionals since 2017, and the latest version is now available.
For the 2020 edition of the report, a new element was added: an additional qualitative survey from Coleman Parkes, which involved carrying out in-depth interviews with users of accountancy services. This comprised small and medium businesses in Australia, the UK, US, Spain, France, Canada, and South Africa.
The questions are candid. What pain points do businesses experience with their accountants, and what expectations do they have? Put simply, do they feel their accountant is meeting their needs – and, if not, what are the areas for improvement?
Below we look at some of the answers, and the surrounding areas that less progressive accountants might still struggle with: dealing with digitalisation, helping businesses with compliance and attracting the next generation. These insights can be used to improve your practice and its service offerings.
The results make fascinating reading for any accounting professional, and provide a snapshot that can guide growth and help create improved service offerings.
All the responses are anonymous except for details about the nature of the survey respondents’ businesses, and their locations. But they are reproduced verbatim.
Free research report: The Practice of Now 2020
We surveyed 3,000 accountants from Australia and worldwide to reveal how the accounting landscape is changing. Discover how your fellow accountants are preparing for the next decade and learn what you can do now to keep your practice successful.
According to this year’s main Practice of Now research, 82% of the survey respondents agree that client expectations of accountants and bookkeepers have widened to include services such as advising on relevant finance and accounting technologies.
Meanwhile, 83% of accountants surveyed agree that new technologies and a culture of digitalisation means they have had to invest more, and quickly, in order to keep pace with the market.
The C-suite executive of medium-sized energy sector business in Australia explains the business benefits clearly: “Technology has enabled us to make real time decisions.”
If technology is this important to clients then it simply can’t be ignored by accountants.
“Technology has positively affected our relationship,” said the CFO of a small construction business in the US. “Our accountant has been flexibly adapting to technology. This has been delighting us and they definitely have elevated the quality of their work with the proper utilisation of technology.”
The financial controller within a medium retail business in Canada said of their accountant, who they’ve used for more than 30 years: “They have always been progressing with the emerging changes. That is one of the reasons why we have stayed with them this long.”
This same individual explained which technologies their accountant has been helping them with: “We have not deployed AI yet, but we are already using automation, cloud and cybersecurity. They have been doing a great job.”
It’s clear from the survey that businesses measure their accountants by their willingness to embrace technology. One director of a small analytics business in South Africa offered a warning: “[My accountant] hasn’t yet adopted any technologies, which is the reason why she is being replaced with somebody who can. My accountant is not adopting technology but the industry is.”
A private individual with income tax responsibilities in the UK said of their accountant: “They need to be IT literate. This is the modern world. Everything is computerised now.”
Now more than ever in a world shaped by COVID-19, it’s clear accountants need to embrace technology. It can help them save time, adapt to the new ways they now need to interact with clients, and provide faster, more value-added services.
To do this, they need to reconsider the way they currently use technology and explore solutions that can help them automate processes and generate the insights clients need. Above all, the goal should be to keep an open mind and adopt technology earlier, rather than later.
Keep up with changing regulations
In our main Practice of Now survey, 79% of accountants agreed that regulations from government, industry, and international bodies are forcing changes to working practices.
Around the world, the legal requirements that clients deal with – and that accountants might be expected to assist with – are expanding exponentially. The recent coronavirus (COVID-19) disruption has only emphasised this, when businesses turned to their accountant for help with government assistance schemes.
When asked what skills and talents they valued, the financial controller of a medium retail business in South Africa said: “The most important factor is regulatory compliance.”
Hiring an accountant today is about more than just accounting, said the CEO of medium-sized security business in France: “My accountant gives me information about the law in France so I can take charge of new laws and change.”
It isn’t necessarily just about compliance with accounting legislation either.
“I know they’ve been doing a lot about GDPR,” said the owner of a small technology business in Spain. “Sometimes I needed legal advice. We discussed it with them and they recommended a lawyer.”
Businesses also indicated that helping them comply with changing regulations was one way they expected their accountant to accompany them on their journey.
“The company is growing,” said the CIO of a medium-sized business in France. “So, they are doing more in terms of work, because we have more things to do. They are doing payroll, they are doing all the regulations for the government such as VAT.”
The C-suite executive of a medium-sized energy business in Australia commented: “Our current accountancy firm has a knowledgeable team, who are experts and know all about taxation, corporate finance and compliance. We can rely on their team. These are the main factors that keep us loyal.”
Staying on top of changing regulations presents a challenge, especially considering clients increasingly expect that knowledge to be both broad and detailed. Once again, any industry body of which you’re a member will undoubtedly track these changes, but a basic approach of regularly visiting government websites can also pay dividends.
Support from your software vendor can also help. If new legislation requires additional functionality be added to software then the support documentation is very likely to explain this need, and the underlying law that requires it.
Embrace the younger generation
If your practice wants to grow in the areas of compliance offerings, or wants to improve its digitalisation for the benefit of clients, where should it start?
It’s certainly possible to instigate training in these areas but an alternative solution that should underpin any plan to improve your practice lies with another finding within this year’s Practice of Now survey results: embracing the new generation.
In our survey, 84% of respondents agreed that one of the biggest external impacts on their working practices and culture has been employees from younger generations, who bring different expectations and attitudes. This in turn forces practices to change, if only to attract this talent.
The strength of millennials and those of Generation Z – whose adulthood began in the 21st century – is in their ability to embrace change; a prospect that older generations might typically be more resistant to.
Whether its implementing cloud-based solutions, digitalising workflows and finding technical solutions, or reaching new business in alternative spaces, this generation is a crucial asset for traditional accountancy firms looking to evolve in tandem with the digital landscape. And their ability to learn the compliance landscape as it exists today, without baggage from yesterday, is a real advantage.
How can your practice go about attracting younger talent?
- Fish where the fishes are. In our survey we asked more than 1,000 of the respondents in the US where they find new talent for their organisation. The most popular answer, from 38% of respondents, was social media platforms, such as LinkedIn and Facebook. This dwarfed more traditional routes, such as college recruitment efforts, which was listed by 15% of respondents. It’s no exaggeration to say that younger people live their lives in social media, so they simply expect you to have a presence there.
- Recruit from outside the traditional accounting background.: In our survey, 88% of respondents said they were amenable to recruiting from areas such as project management, training, customer service, and more. To capture the best entrants from the younger demographic to meet the needs as outlined above, it might be time to ease the requirement for young recruits to your firm to have an accounting qualification.
- Be flexible. We asked our survey respondents, ‘what is the main reason for new staff to join their practice and not their competitors? The top answer for 38% of respondents was flexible working practices – working from home, for example. These issues are known to be important to the younger generation. For example, PwC’s Millennials at Work research talking to more than 4,000 graduates reported flexible working hours as the second most-valued benefit from an employer, behind only training and development – and more important to them than cash bonuses, healthcare, and pensions.
The challenges presented across 2020 have been difficult, but challenges also present opportunities, and it would be a waste if accounting professionals didn’t build upon the effort to create a more competitive practice. As the results from the Practice of Now 2020 show, this conversion of emergency response into new service offerings may become more and more of a necessity in any event if a practice wants to grow and evolve over the coming years.
Recommended Next Read
YML Group: ‘We need to be digital first.’