over 46 percent of respondents expect a five to ten percent expansion of clientele, and another 13 percent say theirs will swell by more than ten percent.
consequently, more than three-quarters foresee an increase in revenues, and barely nine percent fear a decline.
ditto for net profits, though the increases might not match the increases in revenue as “only” 67 percent expect a better bottom line though 12 percent see a dip on the way.
revenue and profit per client are also looking good. a good 59 percent are confident they will see better revenues per client, and an optimistic 19 percent figure the increase will exceed 10 percent.
more chi-ching
profit per client is also rising, with 57 percent hearing five to ten percent more chi-ching coming down the pike, and another 15 percent are looking forward to a major chi-ching.
looking at comments some respondents offered, the growth in client lists may be attributable to attrition in the profession as more practitioners retire while fewer step in to replace them.
so while the increases in clientele will result in revenue increases, the higher revenue may not always translate to higher profits. why? because firms have had to hire new staff to handle all those new clients.
demand up, supply low
one practitioner who sees increases across the board says, “our firm has upped marketing to new clients, raised base prices and anticipates more business; however, there were many additional expenses in 2022 that will decrease the revenue per client overall.”
another explains why revenue and profit aren’t running parallel.
“increased salaries and bonuses to existing staff to retain them,” the respondent reported. “fee increases do not necessarily cover the rate of increase in comp.”
bruce ekmanian, at california’s ekmanian tax and accounting, tells us why he’s so excited: “having to raise fees,” he says. “demand is up, supply is low!!!”
fingers are crossed for fewer extensions, with only nine percent fearing the number will go up much, and 23 percent hoping for a decrease.
kelli cox, a partner with cgc accountants & advisors, has reason to hope for fewer extensions.
“we expect fewer extensions as clients seem to be becoming more and more anxious, wanting things instantly,” cox tells us. “this compresses tax season even more. of course they don’t want to pay more for instant service!”
a pacific coast consultant summed up a lot of the factors influencing this year’s tax season, telling us “we have more clients because cpas in the area are either retiring or not taking on new clients because of staffing/capacity restraints. with no real pipeline of new cpas entering the profession, it’s even difficult for clients to find a cpa to do their work. more tax complexities at all levels, federal, state and local. we are also finding 3rd parties asking clients for increased levels of financial statements, hence more comprehensive compilations and we are seeing an uptick in the request for reviewed financial statements as well.”
we’re just getting into the tax season, but so far, 2023 could be a banner year.
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