Accountant - don't be a light bulb!

Old-fashioned clients are still looking for old-fashioned accountancy firms, but old-fashioned clients will disappear over time

How are SME accountants embracing the use of technology? Or rather: what are they doing wrong when considering the wishes of clients of SME accountancy firms? Research of Accountant.nl shows that a lot is still going wrong. Results of a study by the European Investment Bank show, among other things, that companies that do not digitize are less productive. Non-digital accountancy firms advise more slowly and their advice is often of lesser quality. As a customer, you would think twice about hiring such a firm.

Partly digitizing does not work, as this would mean that some of the information about your organization is on paper and some in the cloud. Unfortunately, there are plenty of examples of companies upholding this half-hearted policy. For example, some respondents of the survey conducted by Accountant.nl (together with three universities of applied sciences, a consortium of more than fifteen SME accountancy firms, the NBA, and the SRA) indicated that they scan invoices and are therefore fully digital. However, digitization encompasses so much more. It includes the way you use data; data intelligence. Smaller clients also want to know where they stand and what their options are.

Digitization does affect the value of the firm

There are still finance specialists – fortunately, an increasingly smaller group – who believe that digitization is not necessary within their profession. I like to compare them to the taxi companies that stayed true to horse and carriage when cars were introduced. Examples of this can mostly be found among the older generation of executives, often working at smaller and local accountancy firms with fewer than 50 employees. They will say: 'Digitization doesn’t have an effect on the value of our company because we have enough clients.' But it does matter when the company is acquired by a new owner, and the first thing they have to do is invest heavily in digitization.

The times in which we (on behalf of the administrative department) presented the annual accounts in spring are years behind us. In this day and age, clients expect continuous insurance. And rightly so. Modern finance specialists are almost continuously sifting through the data of their clients and are thus able to continually report and offer advice. With a robot, you can really monitor everything at any time. For example, PWC flies drones through their clients' warehouses: real-time monitoring.

Innovative developments are going so fast that we may doubt whether the IT knowledge of recent graduates is at the desired level. And whether their education is up-to-date. As a modern finance specialist, you really don't have to be an IT professional, but you do have to understand systems, their possibilities, and how to use them. This calls for extra attention to topics such as data governance, Artificial Intelligence, and communication skills within the curriculum of the courses.

Better decisions through digitization

For example, 15 percent of the CMA program consists of technology. After all, it is the responsibility of educators to keep up with the most important trends and to keep their curriculum up-to-date. Yet it is also the responsibility of accountancy students themselves to focus more on the use of technology within their profession.

Professional groups and companies must also continuously offer additional training. The fact that particularly the older generation often appears to have no desire to get involved in this, does not mean that organizations should follow that mindset. They have to make sure that someone else within the organization picks it up.

A new printer also costs money

I often hear accountants say that they are well trained, and with the excellent accountancy education in the Netherlands, that is largely true. They like to compare themselves to professors or dentists. I would like to go one step further and have accountants compare themselves to surgeons. Surgeons also undergo long training and are constantly looking for innovations. This allows them to do a better job.

Digitization costs money. Smaller offices often have more limited access to capital. Collaborations with other smaller offices and sharing data or software can then be a solution. There are also plenty of large software companies that offer all kinds of packages for smaller organizations. It is a matter of prioritizing. A new printer also costs money, not to mention the person who has to scan all of the invoices.

For all the organizations that think they can continue to operate in the same way they always have because they 'still have enough clients’: think of the light bulb. Before it breaks, it burns brighter... Old-fashioned clients often look for old-fashioned firms, but old-fashioned clients will disappear over time. Make sure that your own organization does not disappear. Don't be a light bulb.

This blog was published in the Dutch Magazine Accountantweek: https://accountantweek.nl/artikel/accountant--wees-geen-gloeilamp