Businesses are often advised to expect the unexpected and this notion has never been more prevalent than in the accountancy sector today. With ongoing political and economic uncertainty, the rising influence of technology, and client demand for differentiated services, these disruptors offer both opportunities and threats to firms that are facing a period of transition.
With all UK businesses facing uncertainty about the future, better finance management is a priority in order to strengthen competitive advantage. With this is mind, here are five trends that are most likely to impact accountancy practices and their clients.
1. The risk of cybercrime
According to research by Beaming, in 2016, cybercrime cost UK businesses £29bn. As accountants hold sensitive financial data accessible through IT infrastructures, they are increasingly coming under attack by hackers. The repercussions of a cyberattack can be devastating for accountants and their clients, and firms need to ensure that they address the epidemic head on. Prevention is often better than cure, and tailored finance solutions can help businesses to introduce robust IT security software and controls as well as providing ongoing cyber awareness training to staff.
2. Driving competitive advantage with technology
Cloud, mobile and optical character recognition solutions can help accountants to dramatically increase productivity, ensuring faster response times to client queries and requests for critical financial data. However, keeping up with the latest advancements in technology can be costly for smaller firms, even if they are growing and cash rich. Flexible asset finance solutions can help by assisting firms to spread the cost of IT related investments, typically over a period from one to five years, without them having to pay for new technologies upfront which could soon become outdated.
3. Greater demand for value-added services
The role of an accountant is evolving towards becoming a trusted business adviser. Accountancy firms that keep pace with digital innovations are well placed to offer additional value-added services, including providing more sophisticated analysis on a client’s financial performance that far exceeds standard tax preparation advice. This includes providing real-time consultancy on all aspects of a clients’ business – from cash flow projections and inventory recommendations – by having immediate access to accurate financial information.
4. Succession planning for growth
Planning for the future is a major challenge in the current climate, and it is forcing many accountancy firms to re-examine their succession plans. Becoming a partner at an accountancy practice offers several potential benefits, from earning a higher income and influencing a business’s future strategy to gaining additional trust from colleagues. However, the transition from salaried employee to profit share can have a major impact on an equity partner’s personal finances.
Specialist financial providers offer expert advice and tailored solutions for new equity partners and retiring partners who are selling their share in a practice. This support helps guide individuals through the process to ensure that it progresses smoothly from beginning to end.
5. Brexit opportunities
In a study commissioned by the AAT and ACCA, 47% of MPs said that they believed that Brexit will have a “positive impact” on the accountancy profession. New trade agreements will have to be negotiated, and accountants are likely to be in greater demand as clients seek clarity around the financial implications to their business stemming from the UK’s impending exit from the European Union.
In contrast, accountancy firms may experience variations to their cash flow arising from reductions in EU funding and may wish to consider flexible, short-term working capital solutions from a trusted financial provider to spread the cost of tax and VAT liabilities.
To find out how you can stay ahead of the competition and successfully navigate the challenges ahead, visit Wesleyan Bank to discuss your firm’s finance management.