The Practice of Now study for this year is based on a survey that three thousand accountants from around the world, including Australia, conducted and which indicated an accounting cultural shift.
In other words, with developments like the desktop PC or the liberalisation of the financial markets, things are changing in a way that we haven't seen in potentially forty years.
This cultural transition is taking place for a variety of reasons, which we’ll discuss below, but ultimately, according to the Practice of Now, it’s happening in response to changes that will become apparent over the course of the next ten years.
Given all the sociological and technological developments taking now, do you honestly believe your profession will remain the same in 2030? What will you do to get ready?
To find out how the accounting industry is evolving, we polled 3,000 accountants from Australia and other countries. Learn how other accountants are getting ready for the next ten years and what you can do right away to maintain the success of your practice.
A staggering 93 per cent of accountants in Australia concur that there has been a cultural change in accounting. Just 7% of people disagree.
What’s happening, then? The poll results indicate that the market and clients, who combined are seeking far more than the typical number crunching and compliance work that has previously gone accounting are contributing to the cultural shift.
In this context, “market demands” refers to pretty much everything that an existing or prospective customer asks a business to do for them, making it one of the criteria with the least amount of specificity. Taking care of your end-of-year taxes is a natural consequence of this, of course. On the other hand, it is gravitating more and more towards the form of consultative services that are directed towards partnerships (and note how increasing client demands is considered important enough to receive its response and segment in our graph above).
Undoubtedly, the purpose of starting your practise was to meet the needs of the market at the time. After all, if it hadn’t, it wouldn’t have advanced very far.
But how well does it meet the needs of the modern market?
The straightforward response to this question is to evaluate your company in relation to any new accounting firm that may have just established itself in your region. Using their marketing materials as a starting point, it might be straightforward to learn what kinds of services the company provides. What is it that they put a focus on? Do they occupy a specific submarket? If that is the case, what leads you to believe that this is the situation?
Having said that, you must likewise be familiar with their commercial philosophy, or, to be more precise, their culture. For instance, the majority of today’s new businesses are increasingly conducting the majority of their operations through the use of social networking platforms. Some companies even do not provide their employees who work from home with a real site to go to. This may strike some as quite revolutionary, while others may not even give it a second thought. However, it makes it possible for the new practise to save money, which in turn reduces the costs incurred by customers who respect such a forward-thinking strategy because they may one day find themselves in a scenario that is comparable.
You may also want to consider visualising what a modern-day accounting business might be like if it were to start operating right now. It is highly unlikely that technological advancements won’t play a central role in all aspects of life. In this age of tax and payroll digitisation, you should probably think twice before establishing processes with clients that are based on paper-based procedures and involve boxes of receipts being delivered to your door. You should also give some thought to whether or not you want to automate those processes. Would you be satisfied with a customer list that is all digital?
It should come as no surprise that the entirety of this is quite revolutionary, and it is quite doubtful that it would be prudent or desirable to retrofit it to the standard practise. But what nuggets of information can you put to use right now to make changes in the way you behave? Even if you don’t do anything else, you should at least try to encourage your employees to discuss where they see things going in the future.
The vast majority of accountants are familiar with a well-known cycle in which governments create new regulations, which place extra pressure on businesses, which then turn to their accountant to at the absolute least assist them comprehend it and frequently to take care of it.
Is there a trend towards more stringent regulations being implemented? In light of the numerous financial scandals that have occurred in recent years, governments all over the world have been driven to create legislation as a response. On the other hand, and maybe in a twist of irony, many of the same lawmakers in the more established economies of the western world have also been fighting to cut back on “red tape.” Instead of expanding or contracting, the regulatory landscape has probably undergone some kind of shift as a result of this.
However, new or changed rules continue to be a key source of revenue for accountants, and they are also becoming a source of innovation because it is difficult for accountants to remain on top of the issue due to the many different types of legislation. According to the research that was put together by Practice of Now for this year, accountants from all over the world are in agreement that it is a component of the cultural revolution.
Although it is evident that your company has specialised in order to satisfy legal standards, do you know if it is also able to adapt to the changes that are demanded by your customers? Is it possible for you or your workers to complete the required training if it is made available? These are the kinds of questions that, according to the findings presented in the book The Practice of Now, should not only be made on a regular basis but also investigated with the intention of implementing changes as soon as possible.
Ever since the first electronic calculator was developed, the relationship between technology and accounting has been quite close. The work that accountants do is undergoing a profound transformation as a direct result of recent developments in technology such as cloud computing, artificial intelligence, and bots.
On the other hand, the responses from the accountants we polled for the Practice of Now research suggested that the adoption of new technology is not happening fast enough. In order for the accounting profession in Australia to remain competitive on a global scale, ninety percent of those working in the field believe that it must speed up its use of new technology.
When asked why firms are lagging behind, one of the reasons cited was a lack of resources (time and money) for digital transformation (12 percent and 34 percent of survey respondents, respectively). despite the fact that 34% of firms believe that a lack of experience is preventing them from achieving their goals.
However, technology is undeniably a game-changer, and this much is evident for those who work in accounting. This is something that has happened to accountants throughout the years. It is a step backwards to offer explanations for problems rather than to apply new technology.
Again, the answer is as straightforward as remembering to keep digitalisation in mind at all times. It shouldn’t be something that is done only once and then forgotten about because of how swiftly technology is advancing and how frequently new and beneficial products are launched to the market.
What are your thoughts on the technology known as blockchain, as well as the transition towards decentralised ledgers, for example? What are your opinions on the fundamentally different ways in which machine learning is affecting entry-level administrative employment inside the industry? If you find that any of this makes no sense to you, then you have a significant problem that will only become worse with the passage of time.
Learn about emerging technologies and make an effort to forecast how such technologies might affect the tools and procedures you already use. Keep an eye out for specific examples of how the technologies are starting to be implemented in businesses. Even if you decide to spend conservatively in technology and training, it is imperative that you involve your customers in the process because it is ultimately they who will benefit from your decisions.
The generation of millennials, born between 1983 and 2000, has received much attention. Those who were born in the twenty-first century reached adulthood for the first time in 2018.
Having grown up in an increasingly technologically advanced culture, millennials have an innate dependence on technology for many aspects of their day-to-day lives. According to a survey by Sage, millennials, in contrast to members of previous generations, have developed their own unique set of values (Walking the Walk). For example, 62 percent of millennials who own their own businesses say they have turned down financial gain in order to adhere to their moral values, and 66 percent say they prioritise their personal lives over their professional responsibilities. Approximately two-thirds of millennials who are now the owners of businesses have high hopes of starting multiple companies throughout the course of their working lives.
They are now actively establishing businesses, which is having an effect on the accounting sector and contributing to the transformation of culture. They require accounting services despite the fact that they are knowledgeable enough to handle day-to-day responsibilities on their own. They view accountants as service-oriented business partners who can guide them through the intricacies and risks of running a firm, and as a result, they place a higher value on accountants. Is that something that your office can provide? If this is not the case, what steps can you take to improve your circumstances so that you may do so and therefore remain relevant?
Nevertheless, there is more to it than just a change in the customer base. Additionally, there has been a recent surge in the number of millennials entering the area of accounting. Nevertheless, there are significant benefits associated with this as well. If you want to attract millennial-owned businesses as clients, the most effective strategy is to hire millennials who share their core beliefs and work for your company. Because research shows that millennials have high expectations for career advancement and little patience for menial job, it is in your best interest to employ them as often as possible.
The field of accounting is currently going through a period in which it is confronted with a perfect storm of challenges, all of which are having a significant impact on the profession in a manner that has not been witnessed for decades. There’s a chance that this is something that none of us have ever encountered before.
Every single accounting firm is under the push to change and adjust their practises. It’s possible that this will require some significant course corrections. It is highly likely that you will need to do an in-depth analysis of your processes and mentality. However, as shown by the data we gathered, there is simply no other choice available to you if you want your practise to be ready for the ten years that are to come.
If you’re a practice manager who is aware of the intrinsic importance of business data, you probably already know about the fuss made about business intelligence.
You might surely recall the pledges that improved practice data will support its growth and the promises of increased business visibility.
However, after finishing this article, you’ll be able to move beyond the general business visibility line.
You’ll comprehend why business intelligence is such a buzzword, how it may actually affect your practice, and how to get beyond the various obstacles that come with implementing it.
Are you prepared to learn more about business intelligence in detail? Let’s begin straight away.
The term “business intelligence” has come to be used interchangeably with data-driven business management over the last ten or so years. It’s a term that the majority of software vendors and merchants use to entice customers with claims of insightful information and practice visibility.
But why are these insights now so crucial, and why is having the visibility everyone keeps telling you you need so crucial?
Customers are growing pickier and pickier. 87 per cent of accountants say that clients demand greater flexibility and better service without paying more, according to Sage study.
Being nimble enough to provide the quality of service clients need is essential for the survival of your practice.
This entails quickly spotting and fixing issues in your practice and seizing any chances that present themselves. As a result, making smarter, quicker, and more fact-based decisions is more important than ever.
Business intelligence promises to give you the level of knowledge you need to make these decisions in the middle of these intensely competitive market conditions.
Business leaders anticipate that business intelligence and its big data will revolutionise business operations much way the internet did a few decades ago, according to a survey by professional services firm Accenture.
Additionally, just over 70% of these company leaders think that organisations who are hesitant to implement new technologies may find it difficult to compete in the years to come.
Over the past ten years, a flood of increasingly accessible technical advancements has enabled many practises to continuously gather and evaluate massive volumes of data in a short length of time.
These new technologies have achieved great advancements in both hardware and software, and their pricing strategies reflect this, resulting in consistently lower ownership and usage costs for these systems.
The software as a service (SaaS) suppliers give the chance to rent business intelligence products through the cloud for a more inexpensive, regular price, in addition to outright ownership models that can require significant upfront expenses and taxes.
You might be hesitant to join the movement despite the benefits of implementing business intelligence. We address some of your potential worries here:
It can be disruptive to transition from a conventional management style that relied more on intuition to a more modern one supported by recently available data-based evidence. It might also be challenging for you to give up decision-making authority without worrying about being confronted with data or information that runs counter to how you feel.
But once you start using data-driven decision-making and seeing its advantages, a natural, cultural shift will start to emerge.
These days, procedures gather large amounts of jumbled, unstructured data. And as its quantity rises, the conventional methods of gathering and processing it grow increasingly challenging (think about a spreadsheet, for example). It quickly reaches a point where the volume of data in your practice can be too much for you to handle. You need a method of handling the data so that it can be turned into useful insights while preserving its correctness and integrity if you want your practice to succeed with this data.
Your practise runs the danger of having an abundance of inaccurate data that is primarily manually entered without being able to take effective action on it if you delay implementing business intelligence tools.
3. Security and privacy concerns
You might be wary of entrusting the data from your practise to cloud-based business intelligence platforms. Because you believe they are more secure and will help you avoid the nightmares of data breaches you read about in the news, you could still favour private networks or offline solutions.
The majority of worries about security and privacy that surround internet solutions are the result of ignorance or incorrect information. Additionally, there are highly tight processes to ensure software providers safeguard and encrypt their clients’ data. If they are not observed, there are significant fines.
Additionally, the considerable dangers of information theft, loss, and destruction are also eliminated thanks to secure backups, remote access, and no established physical location for the data.
In fact, more than 46% of small businesses that have implemented business intelligence employ cloud-based solutions as a key component of their company strategy, according to a Grand View Research research.
Business intelligence serves more than just increasing your practice’s visibility. And it’s not simply to give you a wider perspective of your data so you can see how to improve it. There is much more to it than this.
By providing you with knowledge about the operations of your customers’ companies and empowering you to take quick, data-driven choices, business intelligence will provide your practise a competitive edge.
You can benefit from using cloud-based business intelligence tools created especially for practises by:
They can assist you in turning your client’s data into important business insights. You may provide proactive advise that goes beyond standard tax and compliance with the help of these insights.
Automated procedures that speed up time to insight can be used to simplify complex data difficulties. Workflows can also be optimised by substituting streamlined dashboards and automation for time-consuming, manual operations.
To make data-driven decisions, you may have immediate access to data and insights using simple dashboards and visualisations. And efficiently track internal practise data to raise employee productivity, manage jobs, and achieve your KPIs.
Platforms for business intelligence might assist you in staying immediately updated about crucial happenings in your industry or those of your clients. You might get warnings when operational performance varies or when financial thresholds are crossed, for example.
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