Technology is affecting the world in myriad ways, and this includes the finance industry. CPA firms have to do more than keep up with the software their clients would prefer them to use. They need to understand the services customers want, shifts in the industry and general trends in the field. Here is an analysis of the CPA and management consulting marketing size, current trends and a forecast for the near future.
The Technology Used
One industry report found that ninety percent of accountants feel that accounting is seeing greater technological adoption. This is driven by the need to meet government regulations, meet market demands and deliver the services clients require at a reasonable price.
For example, automating accounting processes is worth it, since it minimizes errors, gives them better data for making decisions and speeds up transaction processing. More than half of C-level executives expect to have automated accounting systems in place. Conversely, this increases the risk of compromised security and fraud. This in turn increases the need for internal auditors over bookkeepers.
While accounting software has become the industry standard, cloud-based accounting software is not yet universal. For example, nearly sixty percent of CPA and accounting firms use cloud-based software, while less than half of small firms do. Younger accounts are more likely to use cloud-based accounting software, and the business case for it is strong. You save your data to a secure cloud and only have to pay a monthly or annual subscription in order to access advanced financial software on the cloud.
The Services Offered
Eighty percent of accounting firms do bookkeeping and accounting. A quarter of CPAs offer payroll and/or tax services. A fifth of CPAs provide compliance or financial advisory services. Nearly one in twenty work as an outsourced CFO for the business. We’ve already mentioned how automated accounting systems are driving demand for auditors. We expect far more automation in accounting because it cuts bookkeeping time in half, freeing you up to work on other, value-added tasks. One industry study suggested that almost all labor intensive accounting tasks like tax preparation, banking and audits will be automated in the near future.
The Increasingly Competitive Market
The world is getting smaller, and accounting is no exception. Outsourcing is the fastest growing area in the accounting industry, such as when businesses outsource an entire payroll or finance department. More importantly, your clients may be located on the other side of the country or the other side of the world.
For example, American CPAs may be asked to handle foreign tax returns or bookkeeping in several different currencies. Multinational firms and firms engaged in significant international trade need specialized advice. Fortunately, accounting firms like Sanjay Gupta CPA, for instance, can provide full-service accounting to individuals and business owners working in the US or India.
However, you have to match competitors in low cost jurisdictions or provide services they can’t. For example, you may apply data analytics to their tax and financial data to provide auditing services or risk management advice. Data saved to the cloud can be shared with financial experts who offer advice in-house accountants cannot.
Big data, the internet, cloud computing and evolving customer needs are forcing CPAs to adapt. Those who can stay ahead of the trends will reduce costs and increase revenue and even grow in a competitive global market for financial services.