The accounting profession faces more than two dozen significant issues, but four trends stand out based on the overarching significance for the profession.
A panel of experts recently told a US conference of CPA firm partners and leaders how four seismic shifts will shape the future of accounting – from how firms generate their revenue and how they staff their engagements, to how they service their clients and how they will build the firms of the future.
Trend 1: Generating Tomorrow’s Revenue
The panel agreed that the way firms made money in the past isn’t how they’ll be successful in the future – and that more and more of the profession will move away from compliance work toward advisory services.
Advisory services are experiencing double-digit growth, while growth for traditional compliance services is in the single digits.
Cybersecurity offerings are becoming increasingly important, not only to reap the benefits in profits, but in greater retention among younger staff.
Trend 2: Staffing Tomorrow’s Accounting Firms
A panelist suggested that firms may need to start worrying less about the quantity of people they hire, and more about the type and quality.
“If we’re going to be offering different kinds of services, we may need to hire different kinds of people,” she warned. “We may be killing off these advisory type people because we’re measuring them incorrectly.”
Even as firms scramble to fill current positions, the type of graduates they need to hire is going to change. “Are accounting students getting the education they need? The accounting schools are teaching them to be good compliance accountants. You need to train them more on advisory services at an early age.”
To keep younger employees, it is important to give them more exposure to clients and to interesting work – and to find ways to use technology to minimise the grunt work that filled the formative years of too many accountants.
Trend 3: Satisfying Tomorrow’s Clients – The Business Model Is Changing
Old metrics like the billable hour are on their way out, the panel believes, to be replaced by newer measurements and approaches that reflect the new emphasis on higher-value-added services.
Firms need to find new ways to get paid for advisory services – many of which they’re already offering for free or at almost no cost alongside their compliance work.
Perhaps the most important thing to realise, the panel agreed, is that there is both a clear opportunity for accountants to make the move, and that their clients want them to do so.
Tech 4: Building Tomorrow’s Professional Service Firm
For their final trend, the panel looked beyond the immediate changes, discussing various technological and economic shifts that will shape the firm of the future that employs many more remote and “gig” employees, and that has embraced the opportunities of developments that many currently fear for their power to disintermediate accountants.
They were particularly positive about blockchain. “Blockchain will allow us to elevate the level of work we’re doing,” a panelist said, improving audits and removing grunt work. In general, “technology enhances what we do, and raises the level of our services and our clients.”
What’s more, the “Uberization” of whole industries and the rise of the gig economy – with as much as 40 percent of the workforce expected to be in freelance or other independent contractor work by 2020, according to an Intuit survey the panelists cited – represent opportunities for accountants to serve those sectors.
In the end, the primary barrier to successfully negotiating these four trends lies within accountants – specifically the profession’s appetite for and ability to process major shifts in how they do business.