Accountancy Industry insights for 2017
To quote the words of Recruitment Director and Head of Professional Services at Search, Peter Preston, “Technology has proven to be an essential commodity that continuously reinvents and reshapes the way we conduct business.” Although the digitalisation of accounting practices has increased in popularity on a global scale, many firms in the UK have yet to implement a more technological and proactive business strategy. Could new plans laid out by HMRC to make digital tax reporting compulsory by the estimated 2018 to 2019 deadline be the push needed to revolutionise the industry? We investigate!
Poor record-keeping dictates future accounting practices
The need to digitalise tax is eminent as accountants prepare to tackle the challenges ahead of the 31 January 2017 self-assessment deadline.
According to an autumn 2016 survey by AccountingWEB in association with Intuit QuickBooks - a global software company that develops financial and tax preparation software, the biggest problem that small business clients face is poor record keeping at 35 percent.
Given the time of year, it is unsurprising that the quality of clients’ record-keeping tops the list of concerns. Accountants who represent financial firms or work within commercial organisations will have to ensure that they prioritise their self-assessment processes, designing of new workflows. They must also consider the migrating and training of clients on new bookkeeping procedures and implementation of quarterly reporting to meet HMRC’s digital tax requirements by the estimated 2018 to 2019 deadline.
“Accountants are going to have to push their clients and employers quite hard towards digital record-keeping. That puts accountants alongside the organisations they serve, being there and available to answer simple questions,” says Rebecca Baker, Tax Lecturer and small business practitioner.
Tackling cloud migration
83 percent of surveyed practices predicted that transitioning clients toward implementing a digital tax reporting strategy will be the biggest hurdle that accountants face next year. Lexi Shore, partner with AC Mole & Co and QuickBooks ProAdvisor, says that while it may be fairly easier to articulate the software and benefits to new clients, the real challenge will manifest itself when showing pre-existing clients how to deviate from old-fashioned methods of maintaining their tax records.
In regards to planning for the transition period, 35 percent of respondents plan to start transitioning clients next year, while 32 percent anticipate that they will begin undertaking the process in 2018, with 17 percent saying they would wait until the last minute.
However, given that digital reformation of traditional processes requires a great deal of education and preparation, accountants that procrastinate for too long may find that they do not have enough time to adequately transition their clients. “It really does take time to transition clients, so it’s a process that needs to be planned well ahead,” Lexy advises.
Digital accounting means a more proactive business strategy
Accountants have historically been characterised by their compliance work, but cloud accounting will pave the way for less data integrity services and less time spent on preparing and analysing annual accounts. As clients become more aware of how innovative accounting practices will save them time and money, they will be less inclined to pay for redundant data accountancy services.
Alan Hemingway, founder and partner of Hemingway Bailey - the QuickBooks UK Firm of the Future 2016 winner for the UK, says that accountancy firms will have to create a platform where clients can request and receive business advice in real time rather than 12 months down the line, after a wrong decision has already been made. This means that rather than chase up clients for pre-existing records that may contain errors, accountants of the future will need to implement a more proactive approach to aid clients in their business processes and strategies.
This sentiment is echoed by Rebecca, who predicts that accountants will need to be capable of answering questions pertaining to future business processes, rather than merely analyse past data. Essentially, this shift in service strategy would make modern-day accountants be viewed more as the financial directors of small businesses.
While some small business owners may be reluctant to move away from spreadsheets to what they perceive as a trendy, flash-in-the-pan technology, the reality is that cloud accounting leaves little to no room for error or loss of data, and thus increases productivity and accuracy in business process
What technological innovation means for skill requirements
According to a new study by Xero, 83 percent of accountants believe that a thorough understanding of technology is equally as important to their career as understanding accountancy. “As we move deeper into technological reformation of the industry, more aspiring accountants are beginning to realise that proficiency in automation and the use of business intelligence tools is crucial for their success.” says Michael Quinn, Senior Recruitment Manager for Accountancy and Finance at Search Consultancy.
Although the increase of automation within the industry has led to speculation that many traditional accountancy jobs may no longer be available in the future, John Williams, Head of the Association of Chartered Certified Accountants (ACCA) argues that the accounting profession is facing a unique opportunity. “Digital is enabling the traditional finance function to shift up the value chain, from score keeper and caretaker to communicator and business partner. Transactional tasks are being outsourced, and cost effectively so, and opportunities have been freed up for professional accountants to become business partners,” he says.
That being said however, ACCA’s recent Generation Next survey of 18,000 finance professionals under the age of 36 showed that 57 percent believe that technology will replace entry level roles in the profession. The good news is that the majority of participants (84 percent) welcome this development, saying that technology will enable them to focus on higher value-added activity.
“While I cannot predict the future needs of our clients, I do believe that the primary requirement will be to seek candidates who add more strategic and proactive value to their business. As such, they may require applicants to be highly trained in digital and ethical skillsets, and contain the ability to manage automated entry-level processes,” says Michael.
Are you an accountant of the future?
The world of Accountancy and Finance is changing, and the industry needs candidates who are tech-savvy, insightful and proactive! At Search, our team of specialist consultants recruit for a wide range of accountancy and finance roles throughout the country. If you would like to find out more about our available accountancy jobs, you can contact Michael Quinn on 0161 835 8622, or see our full list of vacancies here!
About our Contributors
Peter Preston is a business development, corporate strategy and marketing professional with over 10 years experience in the Financial Services and software technology sectors, working with startups to multinationals both globally and in the SME Corporate market. He is currently the Director of Search Consultancy’s Professional Services recruitment division, specialising in recruiting professionals into practice firms and industry and commerce businesses across the UK.
Michael Quinn is a highly motivated, experienced and professional Recruitment Senior Manager for Accountancy and Finance across the Northwest, who is quality focused and results driven. His background has enabled him to embrace, initiate and facilitate change and his goal is to build long term relationships based on trust. He is a firm believer that integrity, honesty, professionalism and hard work generates long term success.