Ep: 97 Top experts answer: "What are your top 3 predictions for the accounting world in coming years?"
The Accounting Answers Podcast, hosted by Rob Brown, asks critical questions of the experts, leaders and influencers who shape the decision-making of accountants, CPAs and finance professionals. Today we ask:
What are your top 3 predictions for the accounting world in coming years?
You'll hear insightful and passionate answers from these 5 experts and influencers:
Wayne Schmidt | Launched Xero Australia in 2009 and now a digital nomad
Laurence Whittam | Consultant enhancing CPA firms' outsourcing efficiency and ensuring global readiness
Leo Ebbert | at CPADigitalPro, using digital marketing to recruit top accounting talent
Leslie Shiner | Provides top-level consulting, helping businesses maximize profits and gain financial control
Lexy Kessler | Leader at Aprio, advising businesses and changemakers in Mid-Atlantic region
Tune into more on this daily show for short, sharp episodes that keep you informed of what's happening in the accounting world and the whole ecosystem of consultants, organizations, vendors and advisors who serve them.
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But you go for the insights and intel that keep you informed. It's easy to find tons of news and how to stuff, but what about the commercial acumen, the business awareness that separates the good from the great professionals, the insights, the trends, the nuances, the patterns, the predictions, the drivers of change. Well, I'm a brown and that's exactly what we're doing here. With this brand new accounting answers podcast, I've interviewed 111 people who care about accounting, who talk to tech experts, fellow professionals and clients every day. These people are on the front line and seeing what's working on what isn't. And you can't be a variety of experts that comes from not just a couple of conversations or talking to your people in your own bubble. You need diversity of thinking and perspectives. So we're asking a range of experts in accounting finance and tech the same five questions about change, talent, people, tech and the future of accounting. And in this daily show of 10 to 15 minutes, you get over 500 brilliant passionate and articulate perceptions, insights, viewpoints of professionals with a stake in the game. And each episode gives you five answers to one of these questions. So you step ahead of everyone else in knowing what the world is thinking about the topics that matter. Let's jump into today's episode. Today was a list in the views of our influencers and leaders on what's coming up for accounting professionals, firms, the profession generally, and the tech ecosystem that surrounds it. Adaptation, innovation and invention are changing the game almost daily. This food state of change makes you wonder how accountants are coping with the now let alone the future. Let's see what our diverse and knowledgeable experts think is on the horizon. Tune in now for the thoughts of the irreverent and always upfront Wayne Schmidt, who launched Zero Australia in 2009. And he's now a digital know lad. Go around the world sharing his extensive experience in cloud accounting to inspire firms all over to embrace technology and innovation. Okay. Okay. First of all, accounting facts. Consolidation. That's going to occur. There's some big things that I'm noticing in Australia. There's a great group, Arbonne, over in Perth, who's doing a lot of consolidation. Jamie, you're Omi, because remember you were going to be in this efficiency. I still owe you only a drink for that. Thank God you didn't do that. I couldn't understand why you're going to call yourself this efficiency as a male. So consolidation, I think, will be occurring and that's still occurring. I've seen that. The tech industry, the people's runway is going to run out. So they're burn rate and how many reporting products do we really need? And there's going to be a come to Jesus conversation with some of the VCs saying, I want my money back. So I think there will be some consolidation and some of the big tech firms buying some of those or them just passing. Remember, geo well, where's that product now? That's gone. So there'll be some product consolidation and that's I think two, three. I think the prediction will be mine. I think the move to having a distributed workforce. So you don't have to go. Oh God, I'm in a town. Population is 100,000. There's only 100 accountants in that town. That's my pool that I can hire from. And they've all slipped around. Everybody sleeps around in this industry. We all do. So maybe having a distributed workforce I think could be a big change. I can see. Now the problem you go over that is that then as that economy in that particular, say the Philippines grows, you're going to get salary increases. But what you're doing is getting rid of some of the grunt work. Ed Chan says this and I do love this. It's controversial. He says there's three types of people in an accounting firm. There's binders, minders and grinders. You know, the grinders are the people doing all the processing. The minders is the person doing all the reviews of their work and that finders is the generating the new business, which is the purpose. The grinders part can be, I think that should be distributed offshore, straight away, as soon as you can. And there's so much opportunity for them to streamline the cash cow on your accounting firm. It's compliance always will be make more money out of compliance. Not less. You know, and maybe you can start looking at those declines, you know, and actually going, I can make more money from these declines if I, you know, offshore the work. Next, we welcome Lawrence Whittom, consultant enhancing CPA firms outsourcing efficiency and ensuring global readiness offering strategies to optimize outsourcing practices for enhanced efficiency and global competitiveness. Top three predictions. So one, we're going to definitely have firms using global teams more and more. And I would say that compared to what it is now, where we see maybe 5% to 10% of the teams being outsourced, I would say it's probably going to be on average closer to about 30% of your team being outsourced, whether it's offshore or domestically outside of necessarily the typical hiring model. That's the first. The second is we are 100% going to be moving towards that advisory focused is compliance going to be gone? No, but I think you're going to find that a lot of the, let's say data entry and compliance piece, let's say with tax right now, for example, a lot of that will have been eliminated by technology. Number one, but also if it's not being eliminated by technology for certain firms that haven't got there yet, it will be outsourced because it's just, that's the only way to keep it profitable. And the third being, I think you're going to find a lot more of the larger CPA firms growing very quickly, right? So, and it's slightly outside of the scope of it's sort of towards more of that M&A side of things. I think you're going to find a lot more CPA firms now being owned by wealth management, private equity, or even just business owners, rather than necessarily CPA owners. And the reason, and I think it's going to be a good thing for the industry because we're going to start to look at firms as more businesses rather than just partnerships, which is going to actually drive a lot more innovation and drive a lot more inclusion in terms of different divisions coming into those businesses where we can now scale a lot, scale a lot quicker and easier as an industry. And not just be the top four being there and always being there, I think you're going to find firms going into that $100 million ranging revenue will look quicker than we've seen over the past 10, 15 years. Now, we're here the perspective of Leo Abbott, CPA digital pro using digital marketing to recruit top accounting talent pioneer in strategies to attract and retail the best in the field through innovative online engagement. Okay, well, I'm going to predict something I don't think other many people are predicting. I'm going to predict a tax overhaul, an overhaul to the tax code, at least in the United States. I think that is the weakest, simplest, easiest way to solve the people shortage, right? If you simplify compliance, make it easier, make it not so difficult and complex, then all of a sudden a lot more people could do it on their own for one. And those that can't and do need professional help, the professionals are less tax to themselves in terms of your time. Well, I think you'll continue to see globalization of accounting, not de globalization. That's the one of the few industries I think that will continue to globalize will keep pushing work out to countries like India or the Philippines or other countries that have a workforce that's getting more and more educated, more and more capable. They know English well, and they can do these tasks that Americans are less likely wanting to do, right? Last one, of course, is automation, right? Any kind of tech that can automate basic tasks, make it simpler, make it so you're just pushing a button, right? Or you're just reviewing a report, you don't have to get in there and punch in the payroll hours, right? It's something that's automated along those lines. You're going to see a massive pros and that is welcome to the microphone. Leslie Shiner, who provides top level consulting, helping businesses maximize profits and gain financial control, offering strategic insights, financial management expertise to drive business success. And I was trying to come up with some top three predictions. And I think ultimately, and because I'm on the older side, I think we started out with the Big 10, and then we had the Big 8, and then the Big 3, and they continue to merge. And what I find is that the smaller accounting firms are more boutique-like. They offer more services. And I think if the larger firms are not able to offer that, they're not going to continue to grow. So I think the prediction, one of my predictions for the future accounting world is that the small boutique firms, the ones that really take care of their clients, are the ones that are really going to survive and thrive. So that's the first of my predictions. The second of my predictions would be that accounting firms, and once again, I go back to what I've been talking about with accountants for years is attracting and retaining talent. And if you continue to have trouble doing that, you have to do something and you have to change something. So I think the accountants will find ways to bring in the young recent graduates and to get them excited about the business and to look at ways to keep them involved and not just burn them out. So I know that it's been slow and that it's been going on, and this has been a complaint that people have had for many years. I still say that the accounting firms are going to have to change, and I think they will have to change. And my third prediction is the discussion that accounting firms talk about consulting activity. They pay a lot of lip service to being consultants, and they're going to have to do better. And I'm hoping, maybe it's not just a prediction, but it's a hope that the accounting firms will do a better job of becoming partners in their client's business and helping their clients understand their business. One of the things I did, I did a keynote for a conference for a software company in Brazil, and the name of my, I don't remember what it was in Portuguese, but the name of my presentation was make accounting exciting and stop calling it accounting. So I speak at a lot of conferences. I speak at a lot of construction conferences because that's what I work with and a lot of system integration conferences. And then I also speak at accounting conferences. And one of the things that I have on all of my material, on any description of any session I teach, or any title, you'll never see the word accounting. When I'm dealing with companies, I'm dealing with profitability. I want them to understand financial management, and I want them to understand profitability. Because when I teach classes for end users, for businesses, if I'm going to teach accounting 101, no one's going to show up. But when I teach owners died to the financial stuff, people show up. So if accountants can get away from accounting or using the term, it's boring and it's dumb and nobody understands it and who cares what they're talking about and swivel over to helping clients improve profitability, I think there'll be a big change in the accounting world. A statement to the conversation now with Lexi Kessler, leader at the PRIO advising businesses and change makers in the mid-Atlantic region leveraging advanced expertise to guide clients through financial and strategic challenges. So I have several predictions. I firmly believe that as I mentioned earlier, the modernization of the CPA license will happen. It's an imperative that it happens. So that's a prediction. And combined with that is the transformation of our image that goes with that. I think that the consolidation in the marketplace will absolutely continue for multiple reasons. There's the reasons of we need its faster and cheaper to merge in the skill set that we need to service our clients more holistically, which has been the APRIO approach. And there's also the aging traditional model of a public accounting firm that needs to change. And you're seeing private equity out there because that's the mechanism in which to change the business model. What happens with that long term, I'm not sure, because I know private equity, there's always an out somewhere in the back end. But that's really the tool to bring that really the generations together to be able to make it happen. So I do think consolidation is going to continue to happen. And I think that also ESG, I think we're going to see it more prevalently in the United States, not because of regulation, I think as a politics, but because society will want it there, the general public and investor community wants to see it there. So I think there's a tremendous opportunity that as a profession, we need to be really focusing on that. And you're starting to see it start to percolate where several years behind where Europe has been, probably a decade even possibly, because I've been hearing about this for a long time. But I do think that we're going to see that within the future. And I also think that the talent pipeline in accounting will expand. And it can expand to traditional accounting, but given that core skill set to be able to leverage it in multiple ways, which is why the CP exam has changed to incorporate that, to bring more flexibility to what a CPA can do and bring value to the business community. So there you have five great answers to the question, what are your top three predictions for the accounting world in coming years? Have you worked in Dev the Week Monday through Friday? We give you the insights of five top influencers in the accounting world on what is coming up prediction wise? What are they willing to bet? And what are they seeing their crystal balls? That's 25 valuable perspectives, viewpoints and best thinking every week. And with a fresh week comes a fresh question and more thoughts from the best accounting leaders and influencers we can find. Thanks for listening to the Accounting Answers podcast and sharing this brand new show with your friends. If you want to join the conversation, you can plug into our community of influencers at AccountingInfluencers.com and check out our virtual speed networking events. These happen every few months for the North American region and the UK Europe region. Great opportunities to raise your profile, build valuable connections and share your thoughts with influential peers. Until next time, this is your hoax Rob Brown saying stay informed, stay relevant and stay connected. [MUSIC PLAYING] (gentle music)
