Every year CPAs face a set of new challenges and obstacles and need to find a way of overcoming them quickly before their business suffers. This is the reason why it is important for them to not only identify the problems, but also to create a plan of action. Knowing how to handle these difficult situations will reduce their adverse impact on the future.
Listed below are the top five challenges CPAs are facing:
1) Do-it-yourself economy
The world is becoming more and more digitalized and with that, it is becoming easier for individuals to do different tasks themselves. Many clients have the opinion that accounting is simple data entry and a computer or free tax software will do all the work for them. This is where CPAs need to step in – it is our job to inform them of the implications of not letting a professional do the work for them, and that their time is more valuable focusing on their work or business.
2) Increased expectations
Being a CPA is not as simple as it used to be. Today, CPAs are expected to be a business consultant and wealth manager as well. Traditional services are a thing of the past and focusing on your clients’ broad needs and being an advisor are a necessity. The hardest thing is finding the time to bring in this expertise.
FILO stands for first in, last out, and is a common method used in managing inventory and cash flow, but also applies to CPAs’ personal lives. Running your firm, meeting with clients, learning how to use new technology, and managing your staff all demand your precious time. Dealing with these situations are first in priority on your to do list, while having ‘me time’ is last.
4) New recruits
Especially with smaller firms, it is becoming much more difficult to hold on to qualified talent. Retaining those employees is vital in regards to growing as a firm as employee turnover costs the firm time and money.
5) Dog-eat-dog world
Running a firm was never going to be easy, but competition has increased and it has become extremely difficult to grow a practice. It is important to know who your competitors are, what services they are offering, and how they differ from your firm.
Knowing some of the common problems CPAs face will hopefully help you be able to overcome road blocks in the future. To keep up with the accelerating pace of change and complexity, CPAs must become more comprehensive, tech savvy, and proactive to maintain their competitive edge. What do you think?