Gearing up for a changed future (Sponsored)

Apr 01, 2020
Technology will be a critical factor in deciding which firms thrive and prosper in the new era, where clients expect their accountants to be both bookkeepers and strategic advisors.

A profound cultural shift is taking place in the accountancy profession. This is being driven by several forces including the evolving nature of practices themselves, increased diversity within their staff, the adoption of new technologies, and rising demand among clients for higher-value business advisory services.

“Accountancy constantly evolves and grows because, ultimately, it responds to the needs of its clients and the people within them,” says Sage Ireland Managing Director, Barry Murphy. “If we step back, we can see how technology affects us all. It is determining how we do business and technologies like artificial intelligence and machine learning are redefining the nature of the relationship between accountancy practices and their clients.”

According to Murphy, clients are demanding much more than just the traditional number-crunching that historically drove accounting while workforces are becoming ever more multigenerational. “From a client perspective, the accountant is no longer seen as the person who just keeps the books. They are moving out of that traditional role and more into consultancy. As newer generations join, you see a greater diversity of thought. Practices will be able to better serve clients as members of staff that come from a range of backgrounds will have had different experiences, giving them a greater understanding of different viewpoints.”

The digital revolution is contributing to the shift, as well. “Technologies like cloud computing and artificial intelligence are easing the administrative burden,” says Murphy. “This helps practices become more productive by automating certain work and augmenting humans with machines.”

He believes accountants are very positive about the benefits of technology and are keen to embrace new tools like artificial intelligence, where they offer clear advantages. “If we think about technologies like artificial intelligence, machine learning and the internet of things, people talk about them as the future but in reality, they are already here in the consumer world,” he says. “It’s only a question of when we see them in the business world. They are using them to free up the capacity to become more strategic. The main benefits for most practices are increased productivity and considerable savings in time. It can cut out some of the drudgeries of data entry, number-crunching and routine communications.”

One practice where technology is delivering definite time saving and efficiency benefits is OSA McQuillan in Dublin. Before using Sage Final Accounts, the process of filing client accounts required junior staff to input the financial data. Then senior accountants would spend a day or two reviewing the information at several stages throughout the process to ensure it met the stringent reporting standards.

Some of that time has been eliminated, meaning executives have more time to mentor staff, drive new business, and develop the company strategy. The second way time has been saved is that, by using Sage Accounting for bookkeeping, staff can quickly enter the data. And due to the integration between Sage Accounting and Sage Final Accounts, almost in a click of a button, there is a set of accounts to review. This has reduced the time on each job, saving upwards of 30 working days across four people per year.

While the traditional core skills of bookkeeping will continue to have their place, accountancy professionals are seeking to widen their service offerings to their clients. “There is a shift from a transactional profession to one focused on partnership and consultancy,” notes Sinead O’Connor, Country Product Lead with Sage Ireland. “This will see practices look outside the profession to acquire the talent and expertise they require.”

Practices of every size will be able to make the shift. “The technology available can be adopted in small steps by practices,” she says. “It’s not a massive leap. There are a lot of small steps that accountants can take for a client as well. Clients are already using technology like ours for their accounts, and it is a natural step for their accountants to use it as well. The client has much more power at their fingertips today. This is not a threat to accountants, however. It allows them to move into a virtual CFO role for their clients and provide a much higher level of advisory service rather than just bookkeeping.”

Indeed, with accounting software packages such as those available from Sage enabling users with little or no accounting experience or expertise to generate their own profit and loss accounts and quite complex reports, the role of the accounting practice is bound to change.

That will enable accountants to free up time to provide more strategic advisory services,” says Murphy. “But there are an awful lot of different stages on the transformation curve, and each firm will move at its own pace along it.”

That increased use of technology on the client-side will see further benefits for both sides of the relationship, according to Murphy. “Data will flow automatically from clients and their bank accounts directly into accountants’ systems,” he explains. “Manual data entry will become a rarity. The relationship between accountants and their clients will be near-instantaneous. The accountant will have a real-time view of the client’s business and will be able to interact with them in real-time.”

Accountants will also know the moment things change for a client. “Their time will be spent proactively looking for business problems and seeing errors before they manifest themselves as year-end error issues.”

And that feeds back into the skills issue. “The practice of the future will be shaped by how it works with clients,” says O’Connor. “They will always need people from finance backgrounds, but they will bring in people with different skills to add value.”

“The client will drive those skills needs,” says Murphy. “There will always be a bit of push and pull. The pace will be dictated by clients who are becoming more adept with technology. Accountants are already technology literate, but they need to be adept at artificial intelligence, blockchain, and machine learning as well.”

That will see increased competition for accountants with those skills, and practices will have to be ready to engage in that war for talent. “The reputation of a firm and its culture are key drivers for why somebody goes to work for it,” Murphy notes. “Salary and benefits are important, of course, but it’s more nuanced now. Employers have to make sure they are represented well on social channels and understand that their staff are their ambassadors. If the firm is known as a great place to work, that’s a good place to start. If it is well-known in a particular industry vertical, they could build on that.”

Technology will not be the only force that shapes the practice of the future. But it will be a critical factor in deciding which firms thrive and prosper in the new era where clients expect their accountants to be strategic advisors as well as bookkeepers.
 
(This article is sponsored by Sage.)