The accounting practice of tomorrow is constantly affected by the latest technologies as well as evolving client expectations and regulations. With bigger competition brewing between large CPA firms, not only is the landscape of the accounting industry is drastically changing, but it also makes the future uncertain for medium and smaller accounting firms as many clients are choosing to work with much larger companies, stressing the question: “Would there be any room for small CPA firms in the future?”
Flickr by Kleran O’Sullivan
Edge of Smaller Firms
With this continuous “digital shift” taking over the accounting industry, what would be the edge of small accounting firms against bigger companies and why some businesses still chooses to work with little firms despite the existence of larger CPA firms? Here are some points:
1. Building a Foundation of Trust
Trust is an important factor when it comes to deciding on which firms to choose. It is the main reason on why a contract is being signed by the client after understanding its policies. Accounting firms, from the moment they send out proposals, ensures the clients that books and financials will be monitored and run smoothly.
Imagine a business as a client of a small accounting firm for the past 2 or 3 years. Let’s just say that they never look for other accounting firms because they trust the firm which handles their books, since with all those years passed they never encounter any issues with their financials, so why would they choose another CPA firm?
2. Easier to Reach
Many companies are rooting for accounting firms which are accessible, since today’s technology can provide all sorts of communication like phone calls, online meetings and emails. Most clients need hands-on accountants who would always be there once needed, and can provide a quick response to their inquiries.
3. Price of Services
When it comes to pricing in terms of service, businesses would avoid accounting firms which shocks clients with additional costs that are not included in the contract they’re signing. Another thing is that some businesses would state “Why would we pick other large accounting firms if we have one which is small but has the same kind of technology as well as caliber of service and also works in a much lower price.”
4. Confidentiality Matters
The smaller the firm is, the better — There are some clients who are very meticulous with the data that they have. Sometimes they prefer a smaller firm with little number of accountants to look at their books.
It’s Now or Never
Currently, as per accounting firms with employees up to 20-50 or 70, they are still adapting traditional code of ethics such as integrity, reliability and knowledge in their work even after embracing technology in their practice, since they believe that what technology does is to automate traditional processes but not robotizing one’s moral judgment; but they have to face the fact that if they want their accounting firm to grow and be able to topple their competitors, then they have to innovate and evolve to survive.
Without a doubt, I can still foresee small CPA firms gaining exciting opportunities and looking forward to a very bright future ahead of them with the help of this so called “digital shift”, as I am seeing technology as a great weapon and game changer that can add some spice in this competition between firms. I firmly believe that smaller accounting firms should not be afraid in competing with larger companies, all they have to do is to embrace the opportunity to change for the better.