Accounting predictions for 2016 … and beyond
I don’t know about you, but I’m always a little depressed by the annual flood of year-in-review stories. Each one reminds me I’m another year older.
I’m a MUCH bigger fan of the year in preview — predictions about what’s coming over the next 12 months in areas that impact my life. AccountingWEB, CPA Practice Advisor and Information Management have already chimed in with some fascinating picks. The folks at Fast Company, meanwhile, are looking beyond 2016 and offering 20 predictions for the next 20 years.
For my money, though, I’m listening to Jennifer Warawa.
Sage’s global vice president of product marketing recently offered five accounting predictions for 2016. Here they are:
1. New government bureaucracy and tax rates will challenge growing businesses, making accountants increasingly necessary for those businesses. “High tax rates and the complexity of the current tax code are persistent problems for business owners,” Warawa said. “(The National Federation of Independent Business’s) most recent Small Business Problems and Priorities survey demonstrates the challenges the tax code presents to small businesses. Five out of the top 10 issues identified in the survey are tax-related.”
2. The role of the accountant will continue to evolve throughout the next tax season, with accountants continuing to broaden their practices' portfolio and adding new services. “Technology, the Internet, improved accounts and tax software have changed the way accountants work and brought efficiencies to accountancy practices,” Warawa said. “The cloud means accountants can collaborate and work with clients in real time. Expectations of clients are changing. Emerging new breeds of accountants bring other skills and business knowledge to help clients beyond the numbers, including HR, technology, marketing and leadership.”
3. Accountants will continue to adopt mobile technology in an effort to find more work-life balance during tax season. “According to research published by GetData, 36 percent of businesses don’t use an accounting app or software solution to handle their books, and yet businesses that have software save, on average, about three hours per week,” she said. “Mobility will become increasingly important for modern business owners and team members, and accountants will need to lead the way in mobile adoption.”
4. Accountants will begin to realize a need for integrated technology to manage all aspects of their practice, including task automation, work flow centralization, job tracking and performance measurement. “This practice management software will demonstrate the new way of thinking about the year-round value accountants need to deliver to clients,” Warawa said.
5. Accountants will find themselves under increasing pressure to grow their practice. “Increased competition, better-educated clients, and the fact that price is now up for discussion and negotiation will make accountants evaluate their current client bases and put more emphasis on gaining new clients,” she said.
There are a lot of big issues there, and only so many hours in the day. How can CPAs possibly hope to cope?
“I go back to that old saying: What’s the best way to eat an elephant? One bite at a time,” Warawa said. “A lot of CPA firms see this need to transform as such a monumental shift that they do nothing at all. (The key is to say) I am going to get started on this journey, and then take one bite at a time: What am I going to do this month, this week, today, to start moving toward the future?”
Taking those forward-thinking bites is important, because Warawa says CPAs of tomorrow will shed their transactional past and be business advisors first and foremost.
“Firms today see themselves as becoming more advisory, partnering more closely with their clients, and becoming part of the workflow in a small- to medium-size business,” she said. “Figuring out how they get into that workflow is a huge opportunity.”
The skills they’ll need to get there will center on communication and collaboration.
“They have the technology, the insights, the information,” Warawa said. “Now they need to have the conversation, and that’s where they’re getting stuck. If I’m a firm getting ready for the future, I’m thinking about how to have a more meaningful conversation with my clients so they can be more successful. It’s about being a more effective communicator.”
Jennifer has plenty more to say about the role of accountants in 2016 ... and beyond. Listen to our conversation in its entirety.