Just like any other profession, the Accounting profession is changing. And it is changing in many ways.
The theme of shifting accountants’ focus from “transactional services” such as bookkeeping and tax preparation, to higher level services such as strategic planning, is one which we are seeing increasingly raised around the web.
In this article on AccountingToday, Daniel Hood discusses what technology consultant Gary Boomer had to say about this shift in the Accounting world.
Boomer points out that “transactional services” that represent many of the more traditional services offered by CPAs are becoming increasingly commoditized. In other words, the market for accounting services has been transformed into a market based on undifferentiated products (including services). As a result, customers increasingly perceive little or no value difference between brands essentially turning the product into a ‘commodity’.One consequence of the commoditization within accounting is that companies start competing by lowering prices. This is why, for example, it is possible to find accountants who only charge €5/hour in Malta.
In reality there are ways in which accountants can differentiate themselves in the market. Some do so by investing in building a strong brand that stands out. Others choose to specialize, making themselves the go-to person in a particular area of expertise.Another way that accountants may differentiate themselves is by offering Financial Advisory services, similar to what Boomer speaks about. The reality is that many small businesses do not have sufficient expertise in matters of financial management and this is where the accountant can step in with his experience. Many businesses require assistance with exercises like budgeting, cash flow analysis, basic credit management, access to finance, even simply interpreting of financial statements.
It is true that there are challenges that come with offering such a service. Two common cited challenges are marketing such a service and pricing it correctly. Accountants will have to find the right solutions for their particular business.
The CPAs who have a long-term vision for their firm will have a proactive attitude towards developing their product offering. To quote Heraclitus, “The only thing that is constant is change”. Those accountants who accept change and are willing to adapt to the changing needs of the business environment, will thrive. As history has proven, the dinosaurs go extinct.
What are your views on how the Accounting industry is developingin your country?