All professions play an important role in ensuring balance is brought to society. Accountants play key roles in the lives of business individuals, and the employees and even consumers who benefit from them. Their tasks are not only limited to recording information and bookkeeping of all transactions, but also providing analyses on these figures to help companies reach their goals, improve performance, make forecasts, and boost their financial standing.
Moreover, professionals like engineers, doctors, or lawyers and businessmen all benefit from seeking help from a CPA. After all, accounting professionals also help with tax compliance and make sure you don’t have any issues with the BIR. Having mentioned that, like any other profession, those in the accounting profession see both highs and lows. They experience many challenges as times change. Below are 5 of the top challenges that accountants may face today.
1. Lack of Accounting Software Literacy
Accounting software is constantly improving and upgrading. With this, most financial transactions and processes are being digitized. Additionally, cloud-based accounting systems are being used. One challenge accountants face is optimizing this cloud environment and being able to sort and analyze data from multiple business applications.
Moreover; these types of software can be quite costly, and concerns a steep learning curve. This makes the role of accountants more complex and requires new skill sets every year. If you’re an accountant and you’re lagging behind in terms of technology, new teach-oriented clients may find it hard to trust you and you could have a harder time keeping up with competing firms.
2. Changing Client Relations and Increased Competition
Concerning technology, the move to online work setup and digital systems has caused a change in client relations with in-house CPAs or accounting firms. Gone are the days when changing firms was difficult because it entailed moving tons of documents and manually analyzing and re-analyzing data. Today, because of digital infrastructure, it is much easier to hop from one accountant or firm to the next.
Moreover, with a rise in competition, traditional accounting firms and in-house accountants find themselves losing clients to external or outsourced accounting service providers which are often more cost-efficient, especially for small-scale companies. This makes it harder for accountants to keep a steady stream of clients and affects their job security.
Additionally, recent global crises, like the COVID-19 pandemic, negatively impacted numerous businesses and jobs all over the country. This has led some companies to fold, causing a loss of clients for many accounting professionals.
3. Grappling with Client Loss Due to Accounting Automation
In line with technology, accounting automation poses a threat to the careers of accountants. Though their profession will not entirely be eliminated, the challenge in dealing with new software is how to adapt to and correctly implement them. These functions, when used correctly, have the profession to improve the accounting profession.
With software present, individuals such as freelancers may opt to no longer use real CPAs but attempt to do a DIY which would save them on paying for professional fees. As such, those who are new accountants may find it much harder to secure their own clients since well-established CPA firms have already secure the majority of the bigger corporate accounts and small to medium scale enterprises.
4. Dealing with the Ever-Changing Tax Laws
The law is always changing, and that goes for tax laws. The BIR always releases circulars, memos, and revenue regulations. Ignorance of the law is never an excuse, even for those who make minor mistakes during tax filing season. It could result in expensive penalties and fines.
Thus, one challenge accountants face is the need to be constantly updated on new laws. This is important, especially regarding laws governing the use of accounting technology and tax management systems. Although CPAs have graduated from reputable schools and have taken the board exams, they must continually update their knowledge to keep up.
5. Making Sure That Financial Data is Always Secure
Financial data is critical, confidential, and important information, which accountants have access to on paper and; recently, digitally. This information is what is analyzed to create plans for companies to assess what’s attainable or not. Considering that these may also be accessed online, one huge challenge accountants face is the need to secure data from breaches, as financial statements, tax returns, and client information may be hacked and used for fraudulent purposes, among others.
Thus, accountants need to constantly be overseeing their data security systems to prevent cyberattacks on them and their clients. If you are accountant, you must find ways to meet all these challenges to effectively meet the demands of your clients. At the same time, if you are an individual or organization in need of accounting services, you must a reputable firm to work with. If you’re in need of accounting, bookkeeping, or tax services, don’t hesitate to call our team for assistance.
