Trends and developments for accounting firms

In this article, I would like to review these trends, as it is very likely that these are also applicable to GGI members in other countries.

1) Shortage of accounting and auditing staff

Our branch is experiencing large shortages of qualified staff, which is creating a pressure for increased salaries. The staffing storage is persistent unfortunately, as our beautiful and challenging profession is apparently not very appealing for young professionals who often expect a better work-life balance, and are not as motivated by the attraction of promotion or more senior job titles. So, in order to attract and retain new staff, at the top of our list should be to have an inspiring work environment and to be a modern employer to our new colleagues.

2) New revenue models for accounting firms

The era of hourly billing is long past due. New revenue models like subscriptions have made their entrance in our industry. Also, the very common “goodwill model” (in which new partners need to buy their place at the top of the accounting firm) is not likely to be future proof, as this model is considered to create too much of a short-term vision. The goodwill model gets in the way of much-needed large investments, as older partners could prefer profit maximalisation instead.

3) Lower hourly rates

More and more, accounting services like compilation assignments and financial audits are considered a commodity. Clients believe that the accountant is responsible for an effcient process of their work and that the rate should be acceptable. With trend no. 1 in mind, this means that we are in quite a squeeze! But see trend no. 4 for a possible part of the solution.

4) Less demand for bookkeeping services due to IT

Administrative work and bookkeeping are slowly disappearing because of the digitalisation and automating of processes. They are replaced by proactive recommendations based on, for instance, “big data”. It is important to fulfil the role of advisor. This role is not necessarily based on knowledge of every inch of the financial statements, but it is more based on asking the right questions of the client. Conversation techniques play an important part.

These four trends provide more than enough challenges for us. But they also come with opportunities and solutions. Let’s take action now – you’ll have more control over how these pressures impact your business and the opportunities they’ll create for you in the market.

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