In the latest version of The Practice of Now survey, respondents were asked what pain–points their businesses experienced with their accountants, and what they expected. We candidly asked if they felt that their accounting needs were being met, and if not, how they could be improved.
The 2020 edition includes a new element – a qualitative survey from Coleman Parkes, which conducted thorough interviews with users of accounting services. These interviews comprised small and medium-sized businesses in Australia, Canada, France, South Africa, Spain, the UK, and the United States.
Here, we will delve into some of the answers, and the areas that respondents felt the less–progressive accountants were struggling with – digitalisation, assisting businesses with compliance and making their services attractive to future generations. These insights can be used to improve your practice and business offerings.
Improvement 1: Constant digitalisation
According to the main Practice of Now research, 82% of responders agree that their expectations of bookkeepers and accountants have grown to include advisory services around finance and accounting technologies. In South Africa, 82% of accountants agreed that firms need to increase the pace of technology adoption to stay competitive.
Globally, 83% of accountants stated that digitalisation and continuous emergence of new technologies have meant that, to be able to keep up with the market, they have had to invest more – and rapidly at that. But they’re also reaping immense benefits. South African accountants that have updated their technology in the past five years report improved productivity and efficiency (68%), and 69% said their firm is ready for the next wave of digital technologies, like AI and robotic process automation.
In Australia, the C-suite executives of a medium-sized energy business noted the benefits clearly: “Technology has enabled us to make real-time decisions.” With technology being this critical to clients, it cannot be discounted by accountants.
“Technology has positively affected our relationship,” said the CFO of a small US-based construction business.
“Our accountant has been adapting to technology and they have definitely elevated the quality of their work by utilising the technology properly.”
A financial controller from a medium-sized retail business in Canada said that their accountant, whom they’ve been using for more than 30 years, has progressively adopted emerging technologies, and that is one of the reasons why they have stayed with their accountant as long as they have.
Some of the technology their accountant has been helping them with include automation, cloud, and cybersecurity.
What became clear from the survey was that businesses measure their accountants by how willing they are to embrace and implement technology. A director in a small analytics business in South Africa warned: “My accountant hasn’t adopted any technologies, which is why she is being replaced with somebody who can. My accountant is not embracing technology, but my industry is.”
An individual with income tax responsibilities in the UK believes that their accountant should be IT literate. “This is the modern world. Everything is computerised now.”
There is a definite need for accounting professionals to keep abreast of technologies. Reach out to industry bodies that you are affiliated with as they regularly release reports detailing not only what is available, but also what is in the pipeline.
Most importantly, keep an open mind about adopting technology sooner rather than later. Implementing new technologies in your own practice first will give you a good idea of what exactly it is that you can offer your clients.
Improvement 2: Stay up to speed with changing regulations
In the Practice of Now survey, 79% of accountants agreed that regulation from industry, government, and international bodies are changing working practices.
Globally, the legal requirements that customers need to handle – and that accountants are expected to assist with – are expanding exponentially. COVID-19 has highlighted this when businesses needed help from their accountants to apply for government assistance schemes.
A financial controller of a medium-sized retail business in South Africa said that the skills and talents that they valued most in their account were regulatory compliance.
“Hiring an accountant today is about more than just accounting,” said the CEO of a medium-sized security business in France.
“My accountant gives me information about the law in France so that I can take charge of the new laws and change accordingly.”
This doesn’t only apply to compliance with accounting legislation. The owner of a small technology business in Spain said: “I know they’ve been doing a lot about GDPR. And sometimes I needed legal advice. When I discussed it with them, they recommended a lawyer.”
Businesses across the board felt that having their accountants assist them with changing regulations was one of the ways they expected them to accompany them on their business journeys.
“Because the company is growing,” said the CIO of a medium-sized French business,
“It means that they are doing more in terms of work because we have more things to do. This includes payroll and covering all the government regulations like VAT.”
The executive of a medium-sized energy business in Australia said that their current accountancy firm has a knowledgeable team, all of whom are experts in taxation, corporate finance, and compliance. “We can rely on their team,” they said. “These are the main factors that keep us loyal.”
Staying up to speed with ever-changing regulations is a challenge, particularly because clients expect immediate in-depth and broad knowledge of changes. Any industry body of which you are a member will certainly be tracking these changes, but it also pays to regularly visit government websites.
Your software vendor can also offer support. Often when new legislation requires additional functionality to be added to the software, the support documentation will explain this need, and also the law that requires it.
Improvement 3: Include future generations
If you want to grow your practice in terms of compliance offerings or improve your digitalisation for the benefit of clients, where should you start?
While it is possible to start training in these areas, a better solution – one that should underpin any plan to improve your practice – is to embrace the new generation.
In this year’s Practice of Now survey, 84% of respondents agreed that the biggest impact on their working practices and culture came from engaging with employees from younger generations, who bring with them unique expectations and attitudes. Practices are forced to change when they employ the younger generation, whether it is to keep them or to attract them.
In South Africa, respondents plan to rely on their reputation as a good employer (48%) and their reputation for industry excellence (39%) to attract the best talent. They also hope to stand out by offering competitive compensation (36%), flexible working practices (35%), senior-level diversity (31%), an attractive company culture (24%), and potential for rapid development (23%).
Millennials and Gen-Zers (those whose adulthood started in the 21st century) bring with them an ability to embrace change, a strength which many of the older generations lack.
Be it implementing cloud-based technology, finding technical solutions, digitalising workflows, or finding new business in alternative spaces, millennials are a crucial asset to traditional firms that are looking to grow and compete in the digital landscape. Their ability to learn the compliance landscape as it exists today, without being held back by habits from yesteryear, certainly counts as an advantage.
How do you go about attracting younger talent to your practice?
- Fish in the right pool. The Practice of Now survey asked over 1,000 US respondents where they look for new talent for their firms. Nearly 40% said they looked to social media platforms such as LinkedIn and Facebook. This far outweighed traditional channels like college recruitment efforts, which only 15% of respondents used. Younger people live their lives on social media, and as such, they expect you to be there too.
- Hire from outside accounting backgrounds. Nearly 90% of respondents claimed that they would be amenable to hiring from areas like project management, customer services, training, and other backgrounds. To find the younger generation who would meet your needs, it could be time to recruit youngsters who don’t necessarily hold an accounting qualification.
- Be flexible. When asked the main reason that new staff join their practice, rather than their competitors’, 38% of respondents claimed it was flexible working practices. PwC’s Millennials at Work research, which talked to over 4,000 graduates, reported that flexible working conditions were second only to training and development in terms of most-valued benefits from an employer. Flexibility trumped cash bonuses, healthcare, and pensions.
While the challenges brought by 2020 have been difficult, they have also presented numerous opportunities. These opportunities would be wasted if accounting professionals didn’t use the lessons therein to grow stronger, more competitive practices. The Practice of Now 2020 results show that converting the needed emergency response into new service offerings could become more necessity than nicety if practices want to grow in the years to come.