Recently I outlined what I believe the lucrative competitive advantage is for professional accounting firms. This move to a more automated and smarter accounting future is also evident in some research we completed earlier this year when we took a look at what hundreds of accounting practices of all sizes have planned for the future.
One of the key realisations we took away from the Wolters Kluwer Tax and Accounting Industry Study 2016 was the squeeze is on for the modern accounting firm as the cloud influences a range of changes and a future of predictive accounting possibilities.
We understand that every single professional accounting firm is unique. Dependent on when you were established and your plans for succession or for retirement, where you are located and how digitally savvy your client base is there are a wide range of considerations to factor in for an industry facing transformation and a move to the new model of predictive accounting.
SMEs are driving change
We spoke to almost 500 SMEs in this study and asked them about the role their accountant played in their approach and move to the cloud. Guess what? The words ‘trusted adviser’ were once again applied to the relationship between SME and accountant – which is great news. Plus, their accountant’s opinion was sought for bookkeeping/accounting software purchases (c.83%).That’s not all c.30% of SMEs were highly likely to follow their accountant’s recommendation (rating it a 6.0 or 7.0). More great news.
But change is coming and we are seeing this in a move away from what was once bread and butter for some accounting firms. With the introduction of new tools and the capabilities of bookkeeping has become a highly commoditised offering. Our study SMEs outlined they are taking on board more and more of the bookkeeping requirements internally (c.81%). The upside of this move to a DYI option is that many SMEs admit they need to look to their accountant for more support for compliance services due to complexity, risk and cost. It’s important to be prepared for a shift in focus and service delivery in your practice to meet this demand.
Here are my three key takeaways for preparing for a future that is facing industry-wide transformation:
Be part of the journey with your client – if you are not a pivotal part of the journey to the cloud and higher levels of self service and automation with your client then it is going to cost both sides. The concept of fixed price agreements are not the priority here, instead be more involved in correctly setting your clients up in the cloud for bookkeeping, business intelligence solutions and any other business-related software solution that will help their business. If you aren’t involved from the beginning you may have to become responsible for costly fixes. This will cost your client and your business. And don’t let your involvement end there – check in frequently with clients and help keep them on track. Stay on the journey together.
Solve how you can keep across what is going on – now with the benefit of the cloud which gives your practice anytime, anywhere communications capabilities work out a way of keeping on top of what is happening and share that with your clients without having to look at your client files every day. One of the benefits of the cloud is that it favours no-one. Anyone can tap into the same information with the tools and the access that are widely available today. The key is to grab this information that can benefit your firm and demonstrate to your clients how you add value by sharing the information, a solution or you will face a future where clients will learn how to do it themselves.
Know what to do about it – once you are across what is going on and the changes that your client base may face, it’s really important to offer expert advice and options. Become a broker of capability and move beyond the accounting domain. Create networking opportunities between your client base to solve issues and generate new business opportunities. Hire experts and digitally savvy staff to speak to their own age group, or offer powerful roadmaps for the future for existing clients (no matter what stage they are at on their journey).
We are going to share insights on what this journey of transformation means for the modern accounting professional in our Transforming the Future of Tax and Accounting roadshow series. Together with experts, including the ATO, we are going to show you how to be prepared for a future of predictive accounting, what it means for your firm and exactly how we can take you there.
Join our journey.
Daniel Wyner, General Manager, Group Product Management, Wolters Kluwer.
Daniel is the General Manager of Product Management globally and is responsible for leading the execution of the global product management team and the continued growth of CCH iFirm across Australia, New Zealand, USA, Canada, India, Singapore, Hong Kong and Malaysia.
He has significant experience in the Accounting and software industries, having previously held the positions of General Manager of Sales, Head of Strategy as well as Segment Manager at Wolters Kluwer. He is also a former Accountant from Practice.