As we face the hurdles of the pandemic, the accounting industry has been the backbone of every business. Knowing what’s happening with your finances and managing them well determines your survival during these challenging times.
The accounting industry comprises mainly of the following services:
- Auditing services
- Tax agent services
- Accounting services
- Bookkeeping services
At the start of the pandemic, major players did measures for cost-cutting such as redundancies, hiring freezes, and wage cuts. But as new opportunities and demand arise, most of these cost-cutting measures were reversed.
Growth Opportunities Amidst COVID
The demand shifted because of the evolving needs during COVID. Firms are diversifying from traditional accounting services to offering tax consulting services, property advisory, and even cybersecurity consulting.
With this, the Australian accounting industry’s 26.2 Billion market size is expected to grow by 1.2% this 2022. Market share comprises roughly 70% of small to medium-sized players. And 30% is accounted for the industry’s big four.
On the brighter outlook, the industry will experience continuous growth in the coming years amidst uncertain economic conditions. But as new opportunities arise, new challenges emerge.
More Disclosure Requirements Due to Economic Impacts of COVID
Financial reports and statements are here to guide stakeholders in key financial decisions. And with the uncertainties of the pandemic, more disclosure requirements are mandatory for all Australian companies.
New estimates and allowances are required to account for financial market volatility, liquidity concerns, restructuring, government intervention, decreasing product demand, going concern issues, and more.
Some additional disclosures include separate line items for material expenses such as restructuring provisions, inventory spoilage, credit losses, impairment losses, and more.
It also includes declaring impactful events after the end of the reporting period because COVID-related microeconomic and macroeconomic changes may happen rapidly or unexpectedly. Sometimes, waiting for another reporting period to disclose the effects is too late for the stakeholders.
The impact of these changes on the financial position and comprehensive income should be expressed to the stakeholders. It allows them to make sound financial decisions as timely as possible.
Moving forward, accounting firms should take into account future changes like the aforementioned in the International Financial Reporting Standards (IFRS).
Requirements for Taxation Laws and Reliefs
With the economic downturn, the Australian Government provided tax relief to support businesses. Some are:
- Instant Asset Write-off
- Back Business Investment – Accelerated Depreciation
- Companies with substituted accounting periods
But not all companies can fully understand and comply to take advantage of it. And during these trying times, most should utilize all resources and remedies available.
Accounting firms are entrusted to be updated with these remedies and to put their utmost diligence to exhaust advantageous tax avoidance and reliefs for their clients.
Upskilling Additional Services Outside Traditional Accounting
With the uncertainties of the pandemic, it’s not enough to offer just traditional accounting. Upskilling is a must to provide additional services for the new demand.
Skills such as financial forecasting, financial analysis, and cash flow projection equip practitioners for the economic risks today. Also, mastering the ever-changing tax laws like the ones listed in the previous section will provide much-needed guidance for their clients.
With this, accounting firms can offer more relevant services during these trying times.
Automation and AI
Accounting programs are getting sophisticated by the minute. What was once a job for a few staff can now be done by just a computer program. Jobs like collecting transactions and compelling bills to financial statements are now automated.
And with machine learning and AI, who knows what else can be replaced?
With this, another challenge is IT literacy. Most AI can’t perform analytic and creative thinking towards solving a problem. That’s our edge.
Accounting practitioners should now have IT literacy to use this automation as a tool for their analysis instead of a threat. They should incorporate it with relevant skills to provide the best services possible.
Understanding Blockchain and Cryptocurrency
The emergence of new financial instruments poses new challenges for the accounting industry. And blockchain and cryptocurrency are on top of the list.
Blockchain is like an open-source ledger of transactions that hold records on multiple computers. It’s integrated with cryptocurrencies like Bitcoin, Ethereum, and others.
All transactions are transparent, and no one can just “print” cryptocurrency without linking it to the blockchain. No government agency can directly dilute the value of the asset through minting. Although not a perfect hedge, even inflation won’t directly affect cryptocurrencies.
It makes cryptocurrency a secure medium for trade. The decentralized nature attracts companies that don’t want hefty transaction fees or foreign translation losses across countries.
Also, with its finite nature bounded by its mathematical algorithm, it can be used as a long-term store of value for investing, similar to Gold.
But the market is extremely volatile. Even one tweet from an influential person can create unfavourable or favourable price actions in just hours, especially for lesser stable cryptocurrencies. For example, a tweet by Elon Musk about Dogecoin (a cryptocurrency) increased its price by 20% overnight.
That’s why accounting practitioners should understand the concept and be updated with the treatment of cryptocurrency in their client’s comprehensive income and financial position.
Cybersecurity
With many companies transitioning to a hybrid remote workplace, computers are heavily utilized to transfer confidential data.
Unscrupulous individuals may intercept these data to their advantage. Some hack into computers to infect and ask for a ransom. Some steal trade secrets for competitors. While others, just want to test their hacking abilities.
Additional safeguards are also required when holding cryptocurrency because they may be secure by themselves but a simple phishing website can hack away your seed phrase access.
A company should have robust cybersecurity. Financial data and assets should be protected from these online risks.
Collection of Payment
With the pandemic, most businesses are one emergency away from being bankrupt. And this can affect even businesses running for decades already. One lockdown announcement or another containment rule can make or break even the strongest companies.
Collection of payment is now a major risk. And some receivables might take a while before turning into cash. Or worse, it might even turn into bad debts expenses.
Marketing Strategies
With the increase in demand, there’s also a surge in competitors in the accounting industry.
That’s why marketing strategies are another challenge for accounting firms. What can you offer that other companies can’t? One aspect is the skills of your staff and how updated you are in this field. But it doesn’t matter if it doesn’t reach your audience.
It’s not enough to just offer relevant services. Accounting firms should know how to entice their target market to avail of their services. And with the technical nature of accounting firms, most are challenged with creative marketing strategies to turn the tables around.
Hiring and Retaining Talented Employees
In the accounting practice, how talented your people are will determine how good your operations will be. After all, the main product is their services and skills.
But then, accounting firms are notorious for high turnover rates. People experience burnout from long working hours and very tight deadlines, especially during reporting periods.
Hiring and retaining talented employees remains one of the top challenges in the industry. And with the onset of the pandemic, most highly qualified prefer working-from-home.
Accounting firms clamour to hire the best and retain the brightest in their roster. And they need to offer compelling salary packages, incentives, and working setups to do so.
Hiring Remote Staff as a Solution
At the start of the pandemic, most accounting firms build hybrid work arrangements to continue operating during the pandemic.
But as remote work became the new normal, most big players are seeing more value in this setup. The big four namely, Deloitte, EY, KPMG, and PwC are offering remote working arrangements even before the pandemic.
And they are planning to extend this setup to most of their employees afterwards to retain top talents, not only in Australia but also around the world. That’s why most smaller Australian accounting firms are following suit.
But not all accounting firms have the manpower or the expertise to recruit the best around the globe. That’s why a partner agency is a great solution for hiring Remote Staff.
Working with Remote Staff
Remote Staff accelerates business growth by helping entrepreneurs recruit and onboard skilled remote talent from the Philippines. With over a decade of experience, Remote Staff has successfully matched remote talents for accounting firms.
From 2020 to 2021, leads from the accounting and finance industry increased by 235%. For the placements, 30.77% are full-time and 69.23% are part-time. By 2022, more and more are transitioning their current remote works from part-time to full-time as they see the sustainability of remote working.
Most hire the following roles for their firm.
Virtual Assistants
Business owners and managers should focus on tasks that bring the most value to the company. But you can’t ignore administrative tasks for long. What you can do is delegate these tasks to capable virtual assistants.
Virtual assistant jobs can range from appointment setting, scheduling, organizing files, research, and it can be extended to social media postings, real estate, and bookkeeping for specialized tasks. With this, you can free up time for the things you can do best.
Data Entry Specialist
With the higher demand for new accounting services, how do you handle all the information coming in? With the thousands of financial data available, not everyone has the time to collate everything. That’s where data entry specialists come in.
Data entry specialists input information, verify its accuracy, correct invalid data, and manage data flow. Coupled with confidentiality, they handle sensitive information and present it in a digestible format.
Bookkeepers & Accountants
With accounting firms getting more clients, they hire additional bookkeepers and accountants to match the growing demand. Most accounting firms need additional manpower in:
- Processing financial transactions
- Maintaining payroll systems
- Maintaining subsidiary accounts and ledgers
- Operating a computerised accounting system
Some might hire for seasonal demand, especially if the reporting dates are approaching. But most retain and train their Filipino talents as permanent employees to sustain the growth.
Management and Organisation Analysts
On top of traditional accounting, more services are offered in these trying times. With more and more companies restructuring to keep up, management and organisation analysts are in-demand to do this job.
They study a company’s organisational structure and then assist them to solve organisational inefficiencies like redundancies, unnecessary procedures, and systems. In this way, accounting firms can maximize their resources and can offer advisory services with the same intent for their clients.
Financial Investment Advisers and Managers
Financial management is a crucial process in this pandemic. After all, cash is the lifeblood of all businesses. That’s why financial investment advisers and managers are in-demand for accounting firms.
Financial investment advisers and managers monitor the company’s assets to maintain a healthy balance sheet. Also, they assess available opportunities and allocate a percentage to invest in them.
It strengthens the accounting firm’s financial position, and you can also offer the same services for their clients as well.
Web Developers
Most accounting firms don’t have websites for the longest time. And the pandemic pushed them to create one for their business. With every company needing an online presence, web developers are in-demand to create eye-catching and easy-to-use websites for your clients.
Moreover, for some that do have websites, it’s outdated for the needs of today. It’s not optimized or innovative enough to attract clients. Web developers apply modern UI/UX design coupled with SEO integration to reach more people through search engines.
Furthermore, robust cybersecurity practices are embedded on these websites to prevent unauthorized information leaks or website failure that will compromise operations.
Digital Marketing Specialist
Improving your services is just one aspect. Another essential process is your marketing because even the top-notch services wouldn’t matter if it doesn’t resonate with your target audience. Hiring digital marketing specialists solves this problem.
Digital marketing specialists provide a systematic approach for a firm’s potential clients. They can utilize social media channels, Google ads, organic SEO, and more, depending on your needs. With the digital marketing strategies in place, you have a competitive advantage over the rest.
Testimonials
As for the Filipinos, full-time remote workers are earning an average of 49,398 PHP and part-time workers at 26,133 PHP. Contrary to the stigma of lowballing Filipino remote workers, the rates are similar to managerial rates in Metro Manila, the central business district.
With this, Filipinos contracted with Remote Staff enjoy working from the comforts of their homes while earning similar or more than their office-based counterparts. Here’s a testimonial of our remote worker in the accounting and finance industry.
Are you looking for your own Remote Staff? View our roster of candidates for your talent needs.
Focus on the things only you can do with the help of Remote Staff.
Leandro is a content creator and digital nomad who started his career as a remote working content writer. He is an advocate of location independent sources of income. And he believes that everyone has the ability to be one as well. If you have any content requests and suggestions, feel free to email him at leandro@remotestaff.com.
