Accountancy firms, like many other industries, are facing their share of challenges and changes with both short term and long term ramifications. The UK's ongoing negotiations on exiting the EU continues to loom over the wider financial industry, firms face an increasingly challenging and baron talent market and technology continues to creep into business operations and functions.
These changes and disruptions are also creating opportunities for agile and innovative firms to get ahead of the crowd and stand out an in a more competitive market.
But which challenges should businesses be focusing on when creating plans for their business and how can they overcome them?
In this blog we lay out the top five challenges facing accounting firms and the wider industry.
Talent sourcing and retention
Qualified or new accountancy entrants are in high demands across the sector with firms being forced to look at least six months ahead in their recruitment strategy, according to a recent article on Accountancy Age.
The number of accountancy vacancies has been on the rise for some time, and the talent gap - in both experienced professionals looking to move on or new entrants entering the workforce - is putting a real strain on the sector's long-term prospects.
It is now necessary for accountancy firms to take a proactive approach to their recruitment in order to get ahead in the War for Talent.
For tips on how to tackle accounting's recruitment crisis why not download our "Winning the War for Accountancy Talent' eBook.
Customer service has never been more important in what has become a more consumer focused business environment and the ease with which a business can lose its reputation through a negative review or online comment is almost scary.
This does, however, create substantial opportunities for accounting firms which can differentiate themselves from the competition. It is no longer sufficient to be just another service provider in the UK economy, firms must now put in the extra work to become almost an extension of their clients' own business - and those firms which can manage this face a brighter future than those which can't.
Getting to grips with automation
The idea of automation in accounting is nothing new - automatically capturing data on invoices and sending it straight to the person with responsibility for signing the payment off has been going on for years - but the increasing use and sophistication of machine learning and artificial intelligence is causing operational headaches for firms as they try to figure out how to bring these new platforms on board.
The biggest challenge is going to be implementing AI and machine learning effectively and not diving head first into it because everyone else is. Used properly, these tools can take much of the laborious manual tasks away from teams and free them up to do what they should be – being the trusted advisor.
Whether it's moving accountancy services to the cloud, making use of automation technology or awaiting the implementation of "Making Tax Digital:, technology continues to maintain a place at the top of the list of challenges accountancy firms face in the future. However, firms should not be tempted to race into a technology overhaul and should instead take the time to investigate which areas of their business can be improved by technology.
Much like the talent gap there are very few, if any, areas of the economy in which the UK leaving the European Union is not an issue, and accounting is certainly no exception. Despite the UK set to eject itself from the EU in just eight months' time there remains no clear sign of what that future looks like, and the UK's financial services sector a particular bone of contention in negotiations it remains to be seen how issues like tax and financial passporting will continue after March 29, 2019.