Accountancy firms are on the brink of “positive disruption”, according to a new survey from Sage.
The fourth annual ‘Practice of Now’ research report from the cloud business management solutions provider polled 3,298 accountants in practice from across the globe.
It found that accountants are rapidly evolving their roles to become ‘change makers’, as digitalisation and growing client demands drive disruption and innovation across the industry.
In total, 82% of accountants say clients are demanding more business advice and consultancy services, while 87% agree they expect more flexibility and better service without an increase in rates.
Concurrently, 83% of accountants said the ongoing effects of technology and digitalisation have forced them to invest more and faster to keep up with the market.
However, the report also shows a robust and tech-enabled accountancy profession, well-placed to help their clients navigate the economic uncertainty of COVID-19.
The majority are confident they can provide business management and advisory services (79%), industry-specific advice (75%), and technology implementations beyond accounting and finance products (73%).
Accountants have been helped in this task by adopting the latest technologies. Over half (54%) said they can provide clients with a faster service thanks to new technology such as 5G, automation and AI, and 43% believe it has improved service and client satisfaction.
The overwhelming majority of accountants (91%) believe new technology delivers value to their business, and 44% describe themselves as early adopters – compared to only 35% last year.
“Far from a retraction in the face of a global crisis, we’re seeing a fresh and competitive accountancy industry emerging,” said Chris Downing, Director for Accountants & Bookkeepers at Sage.
“Rather than flexing under the weight of rising client demands and global disruption, firms are embracing new technologies to adapt and thrive.
“More traditional practices need to keep pace or could struggle to keep up with client demands in the new normal. Ultimately, it’s incumbent on firms to seize the opportunity to become change makers rather than spectators.”
The survey also reveals that growing client requirements and technologies are forcing a new kind of profession to emerge.
More than half (51%) of respondents believe accountants joining the profession today need financial business advisory skills, including cashflow and growth modelling.
To provide these skillsets, more firms are willing to recruit outside of the industry – 82% say they are open to recruiting candidates without an accounting background, such as project management or customer services.
New talent has also become a vital source of innovation: 84% of accountants agree that prospective younger employees have progressive expectations, attitudes and talents, which are forcing them to change and reflect in order to attract the best employees.
Evolving client demands and digitalisation have been the drivers of major innovation across accountancy. Accountants in practice are rising to the challenge, helping clients with crucial advice, new technologies and added services that will carry them through today’s disruptive business environment.
Despite continued uncertainty surrounding Brexit and coronavirus, UK accountancy firms are in a similarly strong position to meet and shape disruption head-on.
The survey shows client demands are, once again, driving sector innovation in the UK. Most (83%) respondents would agree that client requirements are widening, and 85% claim they expect more in terms of flexibility and service levels without an increase in fees.
Fortunately, the majority of accountants believe they are meeting these new requirements: 80% are confident they can deliver business management and advisory services, 73% technology implementation advice, and 75% industry-specific consultation.
Of the 1,000 British accountants surveyed, 93% agreed new technology was helping them meet demands and drive new value for the business.
Over half (52%) believe new technologies have improved efficiency and productivity, while 41% say it has boosted client services and satisfaction.
The strong technological foundations of UK accountants are partly due to the positive legacy of Making Tax Digital for VAT. The majority of respondents (91%) said that Making Tax Digital had benefitted their business in some way, including better compliance (71%), decreased manual data processing (70%) and increased revenue (64%).