12 Jul 2023 How Automation and Outsourcing Can Address the Current Accountant Shortage
Authored by RSM US LLP, July 12, 2023
Across all industries, middle market organizations—and businesses as a whole—are facing a shortage of skilled accounting and finance personnel. While the need for talent is growing, the number of accountants and people seeking accounting degrees is dropping.
For example, in its latest trends report, the American Institute of Certified Public Accountants reported annual declines in accounting graduates of 2.8% and 8.4% at the bachelor’s and master’s levels, respectively. In addition, the AICPA’s 2022 annual report listed 67,000 CPA candidates in 2022, down from 72,000 in 2021 and below the forecast of 74,000.
For example, in its latest trends report, the American Institute of Certified Public Accountants reported annual declines in accounting graduates of 2.8% and 8.4% at the bachelor’s and master’s levels, respectively.
The demand for talent is only expected to increase, so companies have to identify and implement solutions to keep the accounting function operating effectively and efficiently. Organizations have multiple paths to reach this goal, including optimizing internal processes with digital and automation solutions, outsourcing or a combination of both. These measures can provide significant benefits while reducing the strain felt by companies to attract and retain personnel while keeping accounting a compelling and valuable function of the organization.
Increasing the use of automation
Introducing digital tools and automation is a logical first step toward modernizing the finance and accounting function. But even with the desire to change, organizations may not have a clear path forward or have the resources to drive the automation journey.
“Some organizations delay adoption of technology not because they don’t have the buy in or desire to change, but because they feel they don’t have the bandwidth to change,” says Ana Minter, a principal at RSM US LLP. “They’re stuck on the proverbial hamster wheel. They know they’re too manual and they’re relying too heavily on people-based processes, but they also can’t add transformation projects to their already over-worked teams.”
“Some organizations delay adoption of technology not because they don’t have the buy in or desire to change, but because they feel they don’t have the bandwidth to change. They’re stuck on the proverbial hamster wheel. They know they’re too manual and they’re relying too heavily on people-based processes, but they also can’t add transformation projects to their already over-worked teams.”
Ana Minter, principal at RSM US LLP
For organizations that don’t know where to start with automation, the number of options can feel overwhelming. Many fit-for-purpose solutions in the marketplace can enhance or completely transform existing back-office processes fairly quickly, but sifting through the ever-increasing options and selecting solutions that solve today’s challenges while balancing future needs can feel daunting. This is where resources such as RSM’s finance automation practice can add tremendous value by helping to architect solutions with a practical plan to achieve desired outcomes.
Adopting new technology often requires upskilling existing personnel, ideally renewing enthusiasm for their work and the value they bring to the organization. New tools can also potentially attract new personnel interested in working with emerging technology and continuously improving the way the organization completes processes. These solutions also protect against the institutional knowledge loss many companies saw when accounting personnel left the profession or changed positions during the recent “great resignation.” Turnover will inevitably happen, but technology can help insulate organizations against some of the challenges that come with it.
Leveraging outsourcing opportunities
For many middle market companies, outsourcing accounting and other back-office functions is the right move to increase efficiency and consistency. An external provider can execute portions of or even entire finance and accounting processes and alleviate staffing concerns that were prevalent even before the current accountant shortage.
For example, services such as RSM’s finance and accounting outsourcing inherently lean on emerging technology and automation tools to drive efficiency and the ability to provide data-driven insights to clients. This allows the organization to focus more energy and resources on their core competencies rather than being caught in a cycle of seeking, hiring and training accounting personnel.
“When we outsource accounting for clients, it becomes our job to stay on top of automation and technology trends, and provide accounting and finance value to an organization,” says Tara Leja, an RSM partner. “Our clients can rest easy knowing we have the scale to bring top talent combined with enterprise-level technology enablement to each and every transaction or process we perform.”
“When we outsource accounting for clients, it becomes our job to stay on top of automation and technology trends, and provide accounting and finance value to an organization”
Tara Leja, partner at RSM US LLP
Staying in control
With the current volatility in the accounting profession, organizational change is inevitable. Staying ahead by implementing a proactive strategy for automation or outsourcing the accounting function can help your organization find the solutions that fit you best and ultimately deliver the most value.
“The pressure to do more with less in the back office will only continue,” says Minter. “Leveraging your trusted advisors to develop a plan to transform your organization on your own terms—whether that be with automation or outsourcing—will set you up to get off the hamster wheel for good,” she adds. “That additional support can help ease the burden on teams that are simply struggling to get the day-to-day work done, let alone manage the intricacies of a digital and automation transformation.”
RSM’s experienced automation and finance and accounting outsourcing advisors have helped middle market companies in all industries address the challenges related to the accountant shortage and develop an effective framework that meets both current and future needs.
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This article was written by RSM US LLP and originally appeared on 2023-07-12.
2022 RSM US LLP. All rights reserved.
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