At first glance, it appears that there aren’t many bright spots for growth for accounting practices today.
For starters, look at the state of tax preparation. More and more clients are buying “do-it-yourself” tax programs and doing their tax returns themselves. Undoubtedly, the market for this service is shrinking.
What about client accounting? It’s become a low-margin commodity service, thanks to the most widely used “do-it-yourself” accounting systems sold directly to small businesses. These pieces of software have taken control of many accountants’ time and processes. Clients buy the software, but most don’t know a thing about accounting, so they end up making bookkeeping messes. Professional accountants like you have to spend hours cleaning up those messes before they can do their professional work. You became an accounting professional so that you could add value to your clients’ businesses, and give them the crucial business advice they need. But current circumstances make it difficult – if not impossible – do that.
If we look closely, we uncover a disturbing reality – and the reason that accountants have lost control of their core services (tax and accounting).
While technology has undoubtedly brought in tremendous benefits to accountants, it’s also the cause of the diminished control that accountants now have over their core services, and of the marginalization of accounting practices.
The “do-it-yourself” (DIY) accounting systems and tax programs are products of the PC era. DIY accounting systems took control of accounting away from accountants, and DIY tax programs have taken a big bite out of the tax preparation business.
Meanwhile, payroll bureaus used the power of mainframe computers to capture payroll processing services from accountants. The tools accountants had in the 1980’s and 1990’s were no match for the power of these mainframe computers.
If accountants continue on the same path and keep surrendering more and more of their territory to the ever-increasing intrusion of external forces, the prospects for a brighter future for accountants will keep getting dimmer.
But fortunately, unlike previous technologies, new technological advances have created tremendous potential for accountants to recapture a good amount of business they had lost to external forces.
And that’s not all. These technological advances have also created billions of dollars’ worth of new opportunities for accountants.
The revolutionary cloud technology that has transformed so many aspects of our lives in sweeping ways has the potential to completely transform the accounting profession and help you revamp your practice.