Like many other industries, accounting is in the middle of a technological revolution. The pace of change in 2018 was rapid, and with MTD looming on the horizon and the sustained drive towards AI and automation, that trend looks set to continue in 2019.
Add that to the current political and social upheaval we’re experiencing, and it can feel like we’re standing on shifting sands. While all this change certainly brings plenty of exciting opportunities for the profession – it also comes with challenges.
We spoke to seven industry insiders to get their take on what are the biggest challenges that accountants face in 2019:
Alex Davis, business development and UK MTD lead at Intuit QuickBooks:
One of the main challenges faced by accountants is adapting to the changing technological advancements within the industry. Successful organisations will be those that can keep pace with needs and demands of modern services. This next generation of entrepreneurs and SME business owners have grown up technologically-savvy, and digital literacy will continue to have a profound effect on how they live and operate financially.
The accountancy firms that are thriving are those that work with their clients to deliver personalised digital services, freeing business owners to spend more time scaling-up their business and allowing advisers to focus on growing their clients’ revenue, rather than sorting through boxes of receipts.
By embracing MTD, accountants are not only future-proofing clients’ businesses, they’re boosting their own too.
Helen Thornley, technical officer at ATT:
The challenge in 2019 for tax will be managing expectations of technology. It takes time to test and develop robust programmes over a number of iterations when, as tax advisers, we need things to work straight out of the box for all of our clients.
That leaves a gap between HMRC’s agile, iterative approach in the development of IT projects, which should give the best results in the long term, and those frustrated because either a system doesn’t work for everyone right now or doesn’t do as much as they would like.
It’s a difficult balance to achieve, but suggests that digitalisation should be approached by attracting people in because of the inherent benefits of the new system, rather than forcing them to opt in before they are ready.
Chris Downing, director of product management at Sage:
When we’re talking to accountants, they all recognise that there is a skills gap – something that a recent report by TotalJobs (Solving the UK Skills Shortage – 2018) also found, with 60% of employers expecting to see a skills shortage in accountancy and finance. This is largely because of the delayed effects of a recession but also significant industry developments and sectoral changes, which have introduced new and specialist roles.
Accountants need to be able to interpret financial data as they traditionally always have but also – more so than ever before – be up to speed on the plethora of new compliance requirements and create meaning from the financial data to deliver advice and actionable insights for their clients.
Glenn Collins, head of technical advisory at ACCA UK:
It might sound clichéd, but a challenge brings with it opportunity. We see challenges around Making Tax Digital for VAT and digitisation, attracting talent into the profession, maintaining the reputation of the profession, client fee pressure, volume and timeliness of tax legislation and economic uncertainty.
In addressing these, there are a number of opportunities for accountants to re-boot their status as trusted advisers to business. Collectively, I hope the professional bodies and their members reinforce the value of using qualified accountants by demonstrating what a great profession this is and the value it brings to society.
Richard Brewin, co-owner of Progress BB:
I see the biggest challenge facing us this year as the inconsistency within. The firms and individuals striving to modernise the profession and gain benefit from the digital world are, in all honesty, hampered for now by the significant number of accountants not embracing change quickly enough.
The market place sees a conflict with so many firms still offering free and low-priced services, still allowing clients to dump their problems on them and still excusing those who pay little respect to their responsibilities as business owners. In the short term it is an uphill fight for the enlightened so maintaining focus and spirit to do the right thing in the face of competitors excusing the client is the challenge. The profession is heading for the light … it needs to maintain that belief.
Rob Brown, founder and CEO of BD Academy:
The biggest challenge facing all accounting firms and the ecosystem that surrounds them is people. More specifically talent.
As the Baby Boomers are phased out of the workforce, accounting firms and their clients are increasingly comprised of Millennials. Anyone born between 1981 and 1996 (ages 23 to 38 in 2019) is considered a Millennial. Anyone born from 1997 onward is part of a new generation that are now 21 and entering the accounting world.
Growth, innovation and service are driven by people. The right people. Unless you can sell your vision, differentiate your brand and attract Millennials, you will not survive.
Amanda Watts, co-founder and managing director of TwentyTwo Agency:
I believe the biggest challenges facing the industry will be how accountants choose to approach new technology and the soft skills that they will need to develop to maximise their opportunities.
Every day a new piece of software is introduced. Whilst choosing and integrating the right technology will be their biggest challenge, the opportunity lies in having a clear focus for the firm and their clients. Those who crack this will stand out, scale up and have way more fun.