survey: firms on the brink of big spending

economy, pandemic among the causes.

bar chart
the tech spend: some 32% of firms are planning increases in technology budgets, according to this year’s survey. and 63% are continuing to spend as much as during the height of the pandemic. source: accounting firm operations and technology survey.

by 卡塔尔世界杯常规比赛时间
the accounting firm operations and technology survey

after two years of caution and hesitant changes, accounting firms are getting ready to make up for lost time, according to findings from the new accounting firm operations and technology survey.

more survey results: pandemic? what pandemic?  |  m&a looms large for 30% of firms | today’s top 3 tech problems: security, client onboarding and workflow | today’s top 3 management problems: staffing, workflow and tech

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the comprehensive national study of firms of every size says accountants are looking to change practice management, tax, audit, portals, workflow and document management systems. many had been reluctant to change their technologies during the covid-19 lockdown periods.

as firms adjust themselves to the post-pandemic world, they seem to be postponing mergers or acquisitions. while nearly 30 percent were considering mergers or acquisitions in last year’s study, only 17 percent now think they might do so in this year’s study. and even fewer – 13 percent – expect possible merger activity in 2023. blame dubious economic conditions for the drop-off.

the top challenges

for the third year in a row, recruiting and retention is the big issue for firms, hitting 32.1 percent of respondents, down slightly from last year’s 33.6 percent, but up slightly from 28.8 percent the year before.

the second most common challenge is just as predictable: managing workflow during a pandemic. affecting almost 24 percent of all firms, the rate is now even higher than it had been during the worst of the pandemic lockdown in 2020 when it impacted only 15 percent.

the pandemic is also pushing firms to improve their methods of delivering tax returns to clients. rather than meeting to hand over documents, firms are offering clients various tools, such as portals, to track or schedule their data, with digital signatures and payments now much more common.

pandemic management

solo practitioners must feel relatively good this year, as most report little or no pandemic impact on how they run their offices. among bigger firms, however, almost 62 percent of respondents had worked from home and restricted travel for the first time. almost a quarter of firms reported their income was vastly affected.

the biggest pandemic management challenges: communication and workflow are concerns for 49 percent. the biggest firms – those with more than 50 people – are suffering the most, with 50 to 60 percent wincing from communication and collaboration inefficiencies.

dealing with paper documents arriving at the office is also a big problem, with small firms suffering the most.

changes in office space

the trend to remote work is inevitably resulting in changes to office space. most small firms – 91 percent of solo practitioners and 86 percent of firms with one to 10 on staff – are planning no change in office space, though 6 percent of solos just might increase their space a bit.

but bigger firms see themselves shrinking their office footprint. though not many are planning a significant decrease, 27 percent of firms with staffs of 51-100 figure they would decrease space slightly, and 29 percent of the biggest firms will do so.

top tech challenges

today’s technology is nothing less than amazing, but it comes with its own problems.

the biggest challenges in this year’s study:

  1. keeping up with new software, reported by 41 percent of all respondents and 56 percent of solos.
  2. security and risk management, reported by 34 percent of all respondents and 58 percent of the largest firms.
  3. costs to purchase technology, reported by 25 percent overall, including 37 percent of solos and 23 percent of very small firms.

it budgets are trending up at 32 percent of firms, remaining unchanged at 63 percent, and decreasing for a smattering of others.

there is an ongoing shift toward cloud-based tax and accounting software. while only 6.75 percent are very likely to implement software-as-a-service over the next two years, 17 percent see it as somewhat likely. a fifth are neutral or unsure. thirteen percent are already using such services.