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More accounting firms are moving toward a digital way of working. With the knock-on effect of the pandemic and the cultural shift toward remote or hybrid working, accounting software—and the ability to report in real-time between accountants and clients—has never been more important.
However, a recent report revealed that only 30% of accountants class themselves as "progressive" when it comes to software. This means they tend to look for new solutions to help make their job easier and continue to innovate.
Although 41% of the surveyed accountants want to be more progressive with software, they’re held back by costs and time constraints.
So, where does your firm fit on the scale—and does it pay to be progressive when it comes to software?
Let’s find out.
There isn’t a clear-cut definition of “progressive” and “conservative” firms—but the report generally describes them as:
In essence, conservative firms lean more toward the older ways of work, with physical ledgers and basic systems. When it comes to accounting software, conservative firms are likely using outdated versions, rather than adopting advances from recent years.
Progressive firms, on the other hand, often adopt what’s known as a “tech-first approach”: relying on software to automate, enhance & connect almost everything they do day to day. This can include anything from client communications to practice management.
One factor that affects outlook and tech adoption is company size. Typically, the larger the firm, the more progressive its approach, with half of the large firms being progressive, compared to 41% of medium firms and 25% of small firms.
But it’s not just about size—accounting firms in London are also more progressive in their outlook (43%) compared to other regions.
The report identified five main types of persona in accounting firms. These are:
Now ask yourself, which one of these applies the most to your accounting firm? Are you still running on old software, or are you looking into new packages to see where you could invest your money?
If you find yourself falling into the “conservative” camp, here are some of the benefits to becoming more progressive with your accounting software.
How beneficial a progressive approach is to your firm will depend on a number of things. What’s true for firms of all sizes & scales is that, while a conservative way of working can still be viable, a progressive approach will save time and money.
In fact, depending on the services you provide, your clients may also rely on you to invest in the latest software.
According to the report, smaller firms that adopted accounting software earlier showed the most robust growth, especially when facing the introduction of Making Tax Digital (MTD).
Overall, the majority of firms see using the software as a benefit, with 74% of change-aware small firms and 73% of medium-sized firms feeling that software enables them to focus on delivering value.
Many of the progressive firms also found that software saves time and allows them to offer chargeable advisory services for clients who also use accounting software.
Software also enables better financial control and facilitates faster decision-making. Real-time reporting gives accountants a clearer picture of income and expenditure, which can then form the basis of future projections and cashflow.
The data is clear: a progressive attitude toward accounting software can provide your firm with countless benefits. By investing early, you’ll be able to stay ahead of any further developments with VAT and tax - especially as the MTD deadlines inch ever closer.
Implementing software in your practice will inevitably cost more than not using any at all—at least on the surface.
However, when you factor in the time savings it can afford you, as well as the ability to access more profitable work for ambitious, tech-focused clients, it’s an investment worth making.
So, if you’re looking to become more progressive—and more profitable—then why not try CMap? Watch a demo today to find out how we can help you win more work & deliver it more profitably.