Adapt and Prosper: The Future for Accounting Firms
If the pandemic has taught the accounting profession anything, it is that traditional accounting firms full of paper, office hours and in-person meetings are officially on the outs and firms must start to adapt to the new era.
The days of ledger paper and in-person meetings are scarcer than ever, and tech stacks and remote work policies are now the focus for many firms. To compound the issue, the profession has started to see a talent shortage that is requiring firms to figure out how to increase capacity to maintain sanity during busy time and leverage their teams appropriately.
At the beginning of the pandemic, virtually every professional was forced home. For tax professionals, it came at the worst possible time with the April 15 deadline looming. Despite the various extensions, firms had to pivot, if they had not already, to adopt an electronic delivery system. Client portal systems and safe file-sharing services that focus specifically on the electronic delivery of tax returns became vitally important.
But firms shouldn’t stop there. Consumers are using apps to conduct many facets of business and commerce, and human-to-human interaction is less prevalent. Even with businesses returning to more “normal” operations, customers will still want a choice in how they interact. And this includes clients’ interactions with their accounting firms.
In addition to improving the customer experience with apps, overall accounting has changed for the better. Clients who were stuck on outdated software that made seamless collaboration next to impossible were forced to make a change, or at least be more open-minded about change, so they could run their businesses remotely. The increasing prevalence of cloud-based software has opened the possibility for any accounting firm to adopt more of an advisory approach to their services and provide more value by automating lower-end services.
Any accountant who has had the opportunity to follow the #TaxTwitter community on social media will tell you that traditional firms are under fire. Various “members” have been promoting their firms’ low-hour busy season work week, unlimited supply of talent and absence of time tracking. To some, this all seems too good to be true. But potentially, to some extent, this is the way of the future.
Many firms perform a large majority of their services in the first 25 percent of the year, and this often requires a significant overtime commitment to make sure that the workload gets completed timely in such a compacted period. Successful firms will strive for creative ways to increase capacity and decrease burnout. Hiring per-diem help during crunch time is a solution many firms have used for years. This concept has expanded recently with more professional service firms offering outsourced business-to-business services.
For accounting firms, outsourcing can take various forms. One is sending tax returns to an outsourcing provider, such as CCH, and another could be having a “team member” from anywhere helping the team as a temporary, remote employee. If there was a bottomless talent pool, there would not be an issue; however, it is a struggle for teams to find talent. By adopting remote desktops, firms can add employees from other states. This opens the talent pool, but also requires a firm to be able to work, communicate and train remotely.
The unicorn for many accountants is the day that they no longer need to keep time sheets. In an age when firms utilize realization statistics and KPIs to help evaluate staff members, it may be hard to eliminate the time sheet. But firms with no timesheets still have time as a component of the conversation. The timesheet is more of an internal measurement strictly to ensure that jobs are not a bottomless pit of time. Firms that do not keep timesheets can focus on making sure their staff have short-term, hard deadlines that they are required to meet to promote quick turnaround. This concept is still evolving, and traditional firms will likely not eliminate timekeeping altogether, but it is a step in the direction of the future. When the larger firms figure out how to do this and successfully evaluate team members, other firms will likely follow.
The pandemic has proved that working remotely can be successful. While less-experienced staff may need to be in the office to develop their skills and learn from management, it is possible to work remotely for extended periods of time and still get the work done. This gives employees the flexibility to not only choose their own hours, but also to choose where they work. Logging in from a vacation home or Air B&B could be just as productive as logging in from home.
While not every firm may be ready to make the leap to future-proof themselves all at once, changes can be made one step at a time. This could be as simple as testing software by putting a small batch of work through it or having a few remote-only days during the slower months to help with work-life balance. At the end of the day, the profession is changing, and those who do not adapt will slowly fade away.
This article appeared in the Summer 2022 issue of New Jersey CPA magazine. Read the full issue.