Modern Accounting Challenges: How to Prepare Your Workforce
What are Some Challenges Facing the Accounting Profession?
Major accounting challenges facing the accounting profession include an incoming generational shift as baby boomers retire, the need to adapt to rapid technological changes like AI/automation, navigating the rise of remote work, and developing both technical and strategic soft accounting skills to drive value.
There’s a significant need to “supercharge” the accountancy profession, according to Helen Brand, ACCA Chief Executive. This statement highlights the severity of modern-day accounting challenges. The accounting landscape is constantly evolving with technological advancements and regulatory changes.
To stay on the cutting edge, organizations must make sure that new hires have the necessary accounting skills to tackle modern-day accounting challenges.
Accounting Challenges: A Generational Shift In The Workforce
A Pew Research study shows the Baby Boomer generation, born between 1946 and 1964, accounts for about a third of the current workforce. With over 75 million Baby Boomers expected to retire in the next few years, businesses face a significant challenge in replacing this experienced workforce.
As Baby Boomers retire, employers turn to younger generations to fill the workforce gap. This transition is not without its challenges. According to Gallup, by age 68, only 16% of Baby Boomers work full-time, while 17% work part-time. This means that filling the workforce gap today is posing a significant risk to employers.
Many millennials lack the necessary work experience, and the number of Gen X workers educated in basic accounting skills or principles won’t be enough to fill the void. The latest Census numbers confirm that population growth in the United States has slowed, adding to the complexity of the situation.
Accounting Challenges: The Evolution of Job Demands
While the principles of accounting remained mostly unchanged over the last decade, the technology supporting accountancy has vastly improved. Accounting has evolved in lockstep with technological advancements, from accountants relying solely on pen and paper to early IBM computers and finally to the AI-powered tools of today.
These technological advancements have increased accountants’ ability to interpret data, making them more efficient workers. But not all accountants have fully embraced automation and artificial intelligence (AI). Some are still hesitant to adopt new technologies, fearing that automation may threaten their jobs.
As the population of actively employed people ages, coupled with technology and employment needs, worker adaptability has become more important. The accounting industry is gradually moving away from using Microsoft Excel and standard sheets.
Is Automation An Opportunity, Or a Threat?
Let’s address the elephant in the room: the fear that automation will replace accountants. While the media has portrayed automation as a threat, taking over low-level, repetitive tasks, this is not necessarily the case in all instances.
In the accounting profession, automation should be seen as an opportunity for improvement, rather than a threat. The goal of automation solutions is to be a helping hand for accountants, not a replacement.
With automation software, accountants can reduce the chances of erroneous inputs, streamline calculations and forecasts, and ultimately, increase efficiency.
While technical accounting skills are crucial, being a successful accountant requires more than just proficiency in Microsoft Word, Excel, and QuickBooks.
High organizational skills, attention to detail, and accounting-specific skills like bookkeeping, advanced accounting, and business accounting are essential to respond to the challenges of the profession.
Accounting Challenges and How to Thrive: Remote Work
Of course the COVID-19 pandemic impacted the way we work, and the accounting profession is no exception. While remote and hybrid work approaches were not widely adopted prior to 2019, many businesses have since adopted remote work as a new standard.
Research by ConvergenceCoaching says only 4% of 223 CPA firms surveyed in the summer of 2020 were entirely virtual before the pandemic.
However, 81% of firms foresee an increase in remote working among their staff after the pandemic, and around 30% plan on reducing their office footprint in favor of reducing overhead costs.
While remote accounting is feasible, it can be hard for accountants who are used to thriving in an office environment. Reorganizing processes to include remote work plans can be a hurdle for both businesses and accountants.
However, according to a Statista survey, the most significant barrier to remote work is dealing with at-home distractions, such as personal tasks, entertainment, childcare conflicts or work-from-home spouses.
Maintaining a solid work-life balance and accepting that working from home won’t be as easy as initially expected are two key remote working recommendations for accountants.
Accounting Challenges: Hiring the Right Fit for the Company
Spotting the perfect accounting job candidate is easier said than done. According to Snyder, the growing demand for top-notch accounting talent makes talent acquisition a tough task.
Whether you’re an HR Manager, CFO, or firm partner, you know the importance of having accountants who can do more than just crunch numbers. You need professionals with the right technical expertise and soft accounting skills to drive growth, manage risks, and provide strategic financial guidance.
The traditional accounting staff hiring process of resumes and interviews often falls short of giving you a complete picture of a candidate’s full potential. That’s where pre-employment testing becomes your not-so-secret weapon.
Validated assessments allow you to objectively evaluate accounting knowledge, cognitive abilities, Excel skills, attention to detail, and more. It’s a data-driven approach that takes the guesswork out of hiring and increases your chances of landing accounting rock stars.
To “Sum” It Up
The accounting landscape has become increasingly complex, requiring a workforce that is agile and able to adapt to new technologies and flexible work models.
While a strong foundation in accounting fundamentals is still necessary, businesses must also be willing to embrace new tools and automation to stay competitive.
Assembling this future-ready team is where a pre-employment accounting test becomes an invaluable ally. Accounting skills tests for employment are data-driven evaluations objectively measure candidates’ technical expertise, cognitive abilities, and cultural fit – critical for navigating today’s accounting challenges.
By using validated pre-employment accounting assessment tests, you remove guesswork from hiring and significantly increase your chances of securing top accounting talent. Equip your hiring process with the right resources, including an accounting test for new hires.
To gain insights into how an accounting test for employment can impact the bottom line of your organization, check out this ROI calculator tool. Apart from a skill test for accountants, see which type of test aligns best with your company’s specific needs. Try a free sample test today!