Accounting corporations flip to a three-tiered method to uncover alternatives

Accounting corporations are severely impacted by the dynamic post-pandemic economic system. Companies are confronted with the exterior challenges of assembly new consumer calls for, growing compliance pressures, and tax regulation modifications. They’re additionally experiencing an inside wrestle to deal with the lowering expertise pool and rising want to make use of expertise to remain environment friendly.

Whereas the basics of accounting stay the identical, the processes and ability units required to execute them are altering. Right now the major focus of corporations lies in 4 priorities: effectivity, consumer service, development, and expertise. The order of those priorities can fluctuate relying on the scale of the agency. Whereas the options are the identical, the scale of your agency can affect the speed at which you undertake these options in your technique.

Adjusting to a shrinking accounting expertise pool

Accounting and audit corporations, together with the SEC, discover expertise pipelines shrinking on each side. Senior and management-level professionals are choosing earlier retirement or looking for various employment in different industries with fewer hours and restrictions on working areas. Entry-level roles are troublesome to fill as a result of a lower within the variety of graduating CPAs or are dropping certified accounting graduates to careers in different industries that provide larger beginning salaries and extra versatile working choices to assist the demand for improved work/life steadiness. Within the center, 47% of corporations reported they’re anticipating problem retaining present workers in 2023.

To satisfy the shortfall, the trade is trying to streamline accounting staffing necessities by deploying extra instruments, expertise, and coaching to offset the necessity for accounting credentials and to faucet into expertise swimming pools that aren’t accounting-based however can assist the concentrate on consumer companies and work with information to enhance efficiencies.

The U.S. Bureau of Labor Statistics tasks the employment of accountants and auditors to develop 6% from 2021 to 2023, with the common variety of annual openings round 136,400. In response to Revelio Labs Inc., greater than 177,000 accounting and audit roles have been posted in November of 2022. Whereas the necessity for brand new entrants into the accounting occupation will increase, the lowering expertise pool is inflicting corporations to rethink their methods round recruiting and diversifying new hires.

The AICPA 2021 Developments Report discovered the expectations of corporations, who had employed new accountants in 2020, to have extra hires on workers from 2021 to 2022 between new bachelor and grasp’s of accounting and non-accounting enterprise graduates as:

candidates will discover the alternatives fluctuate relying on the scale of the agency. Bigger corporations anticipate to face challenges filling high-level positions, whereas smaller and mid-sized corporations are searching for extra junior hires.

Altering priorities when hiring accounting workers

As you broaden the scope of companies provided to fulfill consumer wants, primarily in enterprise advisory companies, and assist shoppers deal with more and more advanced tax regulation modifications and compliance measures, the skillset and competencies required are altering. Purchasers are nonetheless searching for tax technique companies, however they’re additionally searching for enterprise consulting, monetary planning, decision-making, and HR/organizational assist. With high-profile accounting scandals showing extra often within the information, the impetus for accounting professionals to be hyper-vigilant creates issues relating to overworked, under-experienced workers. Additional care is required to make sure workers are updated and attentive.

Hiring has some stiff competitors with different industries providing improved work/life steadiness, larger beginning salaries, distant work, and development alternatives. The post-pandemic world has elevated the expectation that with expertise, extra work ought to and might be carried out, and at occasions which might be extra conducive to workers’s schedules in each junior and senior ranks.

Whereas the trade is seeing an growing pattern towards monetary incentives equivalent to elevated pay and signing bonuses. For instance, KPMG introduced $160 million was being allotted to growing salaries to retain its workforce. For a lot of corporations, a extra economical answer lies in enhancing the processes and workflow via automation.

Know-how is stepping as much as deal with a number of of the problems. New accounting instruments are being leveraged to automate and even change the duties usually carried out by entry-level roles. Our 2023 Tax Professionals Report cited that “one-third (33%) of corporations automate as much as 25% of their tax workflows, about one-quarter automate between 26% and 50% of their tax workflows, and virtually one other one-third (29%) automate greater than half of all of their workflows. The exception is massive corporations, of which half (51%) say they solely automate 25% or much less of their operations, leading to a decrease total fee of automation.”

How are you going to use expertise to handle accounting staffing challenges?

Companies of all sizes are turning to instruments and expertise options to assist automate their workflows releasing up human sources to upskill, retrain, and develop. You merely have to seek out methods to do extra with much less. With the instruments, expertise, and coaching technique, you’ll be able to deal with a number of points.

1. Cloud-based platforms take away geographical limitations for participating expertise and shoppers.
2. Streamlined processes enhance efficiency, accuracy, and pace.
3. Elevated automation leads to extra time out there to concentrate on value-add companies.
4. Ability gaps are addressed via coaching or automation.
5. Improved consumer companies are attainable at a fraction of the price.

Development-oriented corporations can embrace instruments, expertise, and coaching to attain their development targets. Providing versatile work preparations has turn out to be an expectation of recent job seekers that may simply be accommodated via cloud-based platforms and diversifying the scope of expertise that may fulfill altering roles.

Coaching takes heart stage for smaller corporations that shouldn’t have the sources to put money into expertise and bigger ones that must upskill their present groups. Companies are adopting and incorporating new coaching practices in any respect ranges. New initiatives are supported by applications just like the CPA Evolution initiative, a joint challenge with the Nationwide Affiliation of State Boards of Accountancy (NASBA) and the American Institute of Licensed Public Accountants (AICPA), trying to improve the CPA licensure to include the altering skillset required for the apply of accounting. Hiring junior expertise has began earlier, providing on-the-job coaching to interns, even these nonetheless in highschool, in favor of capturing expertise with the fitting angle and transferable expertise and securing a gradual provide of latest hires. Development-focused corporations prioritize coaching to increase competencies that entice new shoppers, provide extra value-added companies to present shoppers and contribute to price development.

Utilizing accounting staffing challenges to create change

Overcoming accounting staffing challenges and assembly the priorities of effectivity, consumer service, development, and expertise is feasible via a technique that includes instruments, expertise, and coaching. Attracting youthful expertise is feasible by leveraging cloud-based instruments that let extra distant and versatile working preparations. Automating extra technical processes frees up sources for improved consumer service and the flexibility to supply extra enterprise advisory companies. And coaching helps entice new hires, upskill present expertise, and enhance efficiencies with instruments and expertise at a decrease value than hiring extra folks at larger charges of pay.

Companies of all sizes, thriving in a post-pandemic world can take the instruments, expertise, and coaching technique and scale it to the scale and scope of their funds, operations, and targets. By increasing the skillset required, embracing on-the-job coaching, providing versatile work preparations via cloud-based instruments, and diversifying the expertise pool you might be drawing from, your agency will discover extra alternatives.

To be taught extra, obtain the Thomson Reuters white paper, 4 methods accounting corporations can attraction to new professionals.