Accountants feel confident they are at least keeping pace with increasing technological demands, or are even ahead of the curve.
This was one of the findings of a recent survey of over 4,000 accountants by auditing technology provider Caseware, which also found that 41.35% described their firms as average when it comes to adopting new technology, while 35.34% went so far as to say they were early adopters, looking to bring the latest and greatest new tools and solutions into their practices. Only 3.45% described their firm’s tech adoption as “infrequent.” While this represents a small portion of overall respondents, the report noted that, of the 143 respondents who chose this option, 57% were from firms of 10 or fewer workers.
However, even if firms haven’t adopted new tech before, most are planning to in the future. The survey found that 40.62% of respondents expect their rate of new tech adoption to increase slightly over the next two years, while 28.8% expect it to increase significantly. Only 8% said their investment in technology would decrease, while close to 23% said it would stay the same.
“These figures are an encouraging sign that accounting firms are moving on from old-school, paper-based approaches to their profession and are getting on the technology train toward greater efficiencies and higher-value tasks,” said the report.
As for the kinds of technologies these firms will be adopting, the most in-demand solution appears to be accounting software, with 35.5% saying this would represent their biggest technology investment over the next year. Following that came analytics software, pointing to the rise of advisory services, which often derive insights from client data, at 27.3%.
Next up, at 19.5%, was collaboration software, which is consistent with other survey data that found 39.21% of respondents citing “communicating with clients virtually” as their biggest practice management challenge in the past year. However, at the same time, 79.99% said they already have a collaboration tool to facilitate client communications and file transfers. Given this, the data might be suggesting that many of those 19.5% could be looking to change software.
Among the lower priorities, at 11.1%, were security tools, which is also reflective of the low 7.92% that cited “keeping data secure” as their No. 1 challenge over the past year. The lowest priority, at 6.52%, was practice management software.
Mid-market client priorities
While many accounting firms are prioritizing digital transformation, the same cannot be said of many of their mid-market business clients, according to a recent report from Top 50 Firm UHY. Of the 252 professionals surveyed from mid-market companies, 9% said “digital transformation/technology integration” was their top focus for 2023.
This is not to say these businesses do not recognize the importance of technology to their bottom lines, but many are reporting significant challenges in implementing their goals. The survey found that 26.2% struggle to assess what their tech needs even are, while a further 23.8% said that even when they do know what they need, they have trouble finding a competent vendor who can provide it. This may be putting off organizations, as 18% said they have not undergone any significant digital transformations at all.
The importance of finding a competent service provider is underscored by other survey data which found that more than half of respondents, 53.4%, outsource their cybersecurity needs to a third party, versus the 36.1% who handle matters through an internal IT team. The result indicates a demand for outsourced cybersecurity in this sector, which could speak to the rising number of accounting firms offering advisory services on this matter.