Technology is critical for the future survival of the accounting industry

Accounting has come a long way from paper ledgers and manual calculations. Misconceptions characterize the profession as being resistant to change, but trends paint a different picture. Accounting professionals today are leveraging technology to streamline processes, enhance client services, and stay ahead of the curve. Their adoption of automation, artificial intelligence, and analytics are paving the way for the profession’s continued transformation, which promises advancements robust enough for a rapidly evolving business landscape. 

The 2024 Intuit QuickBooks Accountant Technology Survey unpacks how technology is arming the industry with the tools it needs to stay ahead, stay responsive, and stay resilient. New data from the QuickBooks-commissioned survey of 707 US accountants and bookkeepers highlights six important trends:

• Accounting professionals believe that failure to keep pace with technological advancements poses the greatest risk to the industry — and plan to invest in AI and automation tools the most to stay ahead.
• Nearly all respondents (98%) say they’ve used AI to help clients and their businesses over the last 12 months.  
• Almost all (98%) have felt the headwinds of inflation and interest rates, but more than 9 out of 10 agree technology can help them — and their clients — to weather these challenges.
• More than 9 in 10 respondents who have outsourced work agree that outsourcing is another way to maintain business growth by improving efficiency and giving more time to focus on advisory services.
• Amid widespread hiring challenges, more than 9 in 10 agree the latest technology could help them solve skills shortages by helping to attract and retain talent.
• Client needs are increasing, particularly with financial and technology management, but technology is a key to saving time and elevating advisory services. 

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Jump ahead:

• Leaning into technology for success
• Unleashing the power of AI
• How the economy is affecting accountants and their clients
• Outsourcing and profit gains
• Closing the talent gap
• Client lists and client needs are growing
• Tech is optimizing client services
• Client tech considerations
• Don’t lose the human touch
• Sample and methodology

Leaning into technology for success

Ahead of a persistently challenging economic environment and hiring struggles, respondents point to a failure to keep pace with technological advancements as the greatest threat to the profession’s future.

Staying ahead by investing in technology

Accounting firms are keeping up by investing where it counts to stay ahead of the curve. On average, respondents report their firms investing $25,000 in accounting/bookkeeping technologies over the last 12 months and are planning to invest another $24,000 over the next 12 months.

AI and automation tools lead investments for the year ahead

With $24,000 earmarked for accounting technology spend over the next 12 months, accountants are clear where they see that investment going. More than half say they foresee their businesses investing in AI (57%) and automation tools (54%) over the next 12 months. This is a steady increase compared to last year, where a little under half (48%) of respondents said they planned to invest in AI and automation tools.

Technology adoption just as important as accounting skills

More than 9 in 10 (95%) respondents agree that a willingness to learn and adopt new technologies is just as important as traditional accounting skills to succeed as an accountant today.

With a shifting landscape demanding more support for clients each year and the need to stay ahead, accountants capitalizing on tech adoption have a competitive edge. One in 2 (51%) respondents identified their businesses as early adopters of digital tools.

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Unleashing the power of AI

Advancements in technology are reshaping the accounting profession, and the use of AI is leading the charge. Accounting professionals are embracing AI to boost efficiency and help give them the foundation necessary to provide strategic business advisory services. 

Data privacy, not jobs, is the primary concern about AI

Survey findings suggest accountants are likely more concerned about data privacy than AI replacing them. While all respondents expressed some concerns about the advancement of AI in the accounting industry, job replacement (9%) was low on the list. For respondents, data privacy and security (31%), accuracy (21%), and implementation and maintenance costs (21%) ranked as the biggest AI concerns.

Nearly all accountants are putting AI into action

Nearly all respondents (98%) say they’ve used AI to help clients over the last 12 months. Topping the list is data entry and processing (69%), fraud detection and prevention (51%), and real-time financial insights (47%).

Accountants aren’t just leveraging the power of AI for client services — they’re also applying the power of AI for business success. Nearly all respondents (98%) say they’ve used AI for firm operations over the last 12 months. Topping the list is managing client portfolios (65%), client communications (54%), and invoicing and payments (53%).

Ethical AI

Accountants are leveraging AI with ethics top of mind. For those who have used AI, almost all (99%) indicate that AI usage has been under formal ethics guidelines. Two in 3 (66%) say guidelines have mandated formal notices to clients on how their firms are utilizing AI in their work.

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How the economy is affecting accountants and their clients

In 2023, accountants’ business outlook was positive with 82%* sharing they anticipated business growth in the coming year. However, the accounting community has since felt the shockwaves of changing conditions. As shown above, 1 in 5 (21%) respondents flag “a challenging economic environment that does not improve” as one of the biggest threats to the future of the accounting industry. As prices have climbed and the federal interest rate remains at the highest it has been in more than two decades, economic tides are affecting both accounting firms and their clients. 

Profitability takes a hit

Accounting firms aren’t immune to economic tides. Almost all (98%) say they’ve been impacted by rising costs and high interest rates. Reduced profitability due to increased costs of doing business (63%) ranks as the most significant obstacle firms have faced as a result of these economic challenges.

Technology can create resilience in a hard economy

As businesses continue to grapple with the realities of rising costs and higher interest rates, accounting firms find themselves under increasing pressure to adapt in order to remain profitable and competitive. One of the key ways that accounting firms can manage this challenge is by embracing technology. More than 9 in 10 (93%) respondents agree that accounting firms making more use of technology are more likely to survive periods of high inflation and interest rates.

Accountants concerned that higher interest rates are squeezing clients

Accounting firms aren’t alone. Clients are feeling pinched too and the pinch is in their pockets. Almost all respondents (99%) say clients have been hit by rising costs and higher interest rates. Three in 5 respondents (60%) say clients have had to carry the burden of higher costs of assets for their businesses, and more than 1 in 2 say clients have been impacted with increased difficulty obtaining financing (55%) and lower returns on investments (53%).

Inflation and higher interest rates are a top client challenge

While ensuring compliance with regulations and tax laws ranks as the top challenge for clients over the last 12 months, the recent economic environment has also been a significant hurdle. Maintaining profitability despite higher prices and interest rates (20%) ranks as the second biggest obstacle clients have faced over the last 12 months.

Inflation and higher interest rates could inhibit clients’ growth with no change — but technology can help weather the storm

Although inflation has cooled, businesses aren’t out of danger yet. Nine in 10 (91%) respondents agree that while the rate of inflation has slowed, rising prices and higher interest rates still pose a threat to their clients’ growth over the next 12 months.

With the pressure of the higher cost of borrowing, clients leveraging technology for innovation, risk mitigation, and a deeper understanding of their financial performance are one step ahead. Nine in 10 respondents (92%) agree that more tech-advanced clients are better prepared to weather economic challenges such as inflation and high interest rates than less tech-advanced clients.

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Outsourcing and profit gains

Outsourcing has emerged as a powerful tool for enabling accounting professionals to shed much of their compliance workload so they can focus on advisory work with clients. 

Outsourcing is building a better business model 

Almost all (98%) respondents have outsourced at least part of their work over the last 12 months. General ledger and transaction management (62%), accounts payable and receivable (50%), and financial statement preparation and reporting (42%) are the top three outsourced services.

Outsourcing is positioning accounting firms to scale up and manage risk. For respondents that have outsourced work, increasing the business’s ability to scale (65%) and improving risk management and compliance (56%) are two of the biggest benefits. Others include improved efficiency (51%), improved ability to reallocate resources to other important work (46%), and improved accuracy and quality of work (39%).

Outsourcing is allowing accountants to save time on compliance work and leading to new growth opportunities. By enabling firms to cut down on the time dedicated to compliance, outsourcing is allowing them to invest more heavily in business advisory services, where deeper relationships and higher margins can be achieved. Data from this year’s survey shows that more than 9 in 10 (94%) respondents agree that outsourcing can help drive profit growth by allowing firms to spend more time on advisory services.

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Closing the talent gap

As the industry grapples with an ongoing talent gap, technology has emerged as a critical tool. Accounting professionals aren’t just using technology to attract and retain top talent — they’re also using it to bridge the gap with increased efficiencies. Data from this year’s survey finds that more than 9 in 10 (94%) respondents agree that if the workforce does not stop shrinking, accounting professionals will need to rely on technology even more for business success.

Hiring challenges persist

The accounting industry is standing at a crossroads with the advantages of tech advancements, but the strain of a talent shortage. From last year to this year, hiring struggles persist. More than 9 in 10 (94%) respondents say hiring has been a challenge across the board — up 8 percentage points compared to last year*. The concern appears to be growing for early start professionals compared to last year*, particularly when it comes to hiring graduate/entry-level roles.

Leveraging technology to hook talent

With fewer qualified accountants entering the field, a smaller labor market means the competition for top talent is ratcheting up. As the pressure to attract top candidates mounts, respondents are again looking to technology for solutions. Almost all respondents (99%) say their firms will prioritize the latest technologies to support day-to-day work to both attract and retain talent over the next 12 months.

Alternative licensure pathways are effective prep

In light of the talent pipeline shortage, many accountants are calling for industry standards to shift. Nearly all (98%) agree that alternative pathways to CPA licensure can prepare upcoming accountants as effectively as or more effectively than the traditional 150-hour pathway.

Client lists and client needs are growing

Despite a talent shortage, accountants are growing their client lists and seeing increasing needs among clients. Eight in 10 (81%) respondents report expanding their client lists over the last 12 months with an average increase of 24%. Expanded capacity due to technology investments (50%) and additional staff hires (62%) top the list of reasons powering these expansions. 

Financial and technology management in demand 

Clients are demanding more from their accountants. Slightly increasing from last year (67%)*, 68% of respondents indicate that clients have needed more support with financial management. But while financial management needs are on the rise, tax filing needs have declined, with 52% of respondents reporting their clients needed more support with tax filings this year compared to 61% last year.*

As accountants step up to be strategic business advisors, clients are increasingly relying on them to help navigate a constantly evolving technology landscape as well. Nearly 7 in 10 respondents (69%) say clients have needed more support with technology management over the last 12 months. With businesses needing to integrate various technologies into their operations, the role of the accountant has evolved to cater to the full spectrum of their clients’ needs.

Advisory services are driving industry impact

With client needs evolving, accountants have adapted accordingly, leaning into more strategic and advisory services that bring added value to clients. This evolution has ushered in a new era in the industry with professionals rising to the challenge and demonstrating just how critical their services can be for the success of their clients’ businesses. Respondents are clear: this evolution has been a game-changer for the industry. An increased emphasis on advisory services ranks as the single greatest positive impact (35%) on the accounting industry over the last 5 years.

Accountants are leveraging technology to empower them with the data necessary to advise clients in the right direction — so much so that respondents rank customization of services and advice based on client data analysis as the top competitive advantage they attribute to technology.

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Technology is optimizing client services

As last year’s survey insights revealed, technology is helping free up time to focus on taking on more of an advisory role to clients. This year’s data is painting a clearer picture of how. Technology is cutting time with compliance, and creating a new standard of excellence when it comes to strategic business advisory. 

Streamlining compliance and unlocking new business opportunities in the year ahead

From crunching numbers to helping with strategic business consulting, technology has pushed the accounting industry in a new direction with new opportunities on the horizon. Looking ahead, technology is helping unlock compliance efficiencies as a first step. Respondents say technology will help save time with preparation and filing of tax returns (98%), bookkeeping and financial reporting (94%), and cost accounting and budgeting (93%) the most over the next 12 months.

By streamlining compliance tasks, technology is making it easier for accountants to dedicate more time to strategic business advisory services, increasing face-to-face time with clients and making their client interactions more meaningful. As a result, businesses are increasingly turning to accountants as trusted advisors, rather than just compliance specialists. Accountants are stepping up to the challenge and leveling up their work. More than 8 in 10 respondents expect technology to elevate the quality of their advisory services over the next 12 months — particularly business strategizing (99%), risk management (94%), financial forecasting (93%), and valuation services (93%).

With the aid of technology, it’s no surprise that strategic business advisory is taking up a significant share of accountants’ time. On average, respondents report dedicating nearly half (47%) of their time to strategic advisory.

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Client tech considerations

Just as accountants are embracing technology and enjoying business success, their clients are following suit. On average, more than 2 in 5 (45%) respondents’ clients have grown profits over the last 12 months (for purposes of the report, profitability is anything above breaking even or $0). For respondents whose clients have experienced profit growth, implementing or optimizing accounting technology solutions (71%) is the service they say has contributed the most to their clients’ increasing profits. 

Tech-advanced clients boost business

Accountants aren’t just leveraging technology for added benefits in their work — they’re also choosing to partner with more tech-advanced clients. On average, nearly 3 in 10 (29%) of respondents’ clients are considered “tech-advanced."

Respondents unanimously agree — working with tech-advanced clients is a boost for business. Increased efficiency and accuracy (65%) takes the lead in the biggest advantages that come with these partnerships. Additional benefits include keeping job satisfaction high (50%), and better communication and collaboration with clients (48%).

Working with tech-advanced clients is providing greater opportunities for accountants — to the point where tech adoption has become a major consideration for client fit. Accountants aren’t just on the lookout for high-growth potential (73%). More than half of respondents (59%) are also weighing clients’ use of technology in assessing whether they’d be a good fit for their business — far ahead of potential revenue/cost benefit (39%).

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Don’t lose the human touch

Soft skills such as communication, collaboration and problem-solving are just as important for success in today’s industry as tech proficiency. While AI and technology can offer accuracy and efficiency, the ability to build positive relationships and think critically still holds weight.

Balancing the tech approach with a human approach 

More than 9 in 10 (94%) respondents agree that soft skills are just as important as traditional accounting skills to succeed as an accountant today. Similarly, prioritizing human touch and connection with clients and staff is just as much of a competitive advantage as technological capabilities (95% agree). 

Thinking critically is another valuable skill for today’s accountants. Given the detail-oriented work accountants do day to day and the growing importance of strategic business advisory, it follows that the ability to identify and troubleshoot complex issues ranks as the most important soft skill for today’s accountant (99%).

Sample and methodology

Intuit commissioned an online survey in March 2024 of 707 accounting professionals throughout the US, all aged 18+. More than 2 in 5 (44%) respondents own an accounting or bookkeeping business. More than 1 in 2 (56%) are employed by an accounting/bookkeeping firm as an accountant/bookkeeper. Two in 5 (41%) work for firms with more than 100 employees. Nearly 3 in 5 (59%) respondents work for firms with 0-99 employees. Percentages have been rounded to the nearest decimal place, so values shown in data report charts and graphics may not add up to 100%. Responses were collected using Pollfish audience pools and partner networks with double opt-ins, random device engagement sampling, and post-stratification based on census data to ensure accurate targeting and results. Respondents received remuneration.

*Note: The 2024 survey sample excludes accountants/bookkeepers who work in-house at non-accounting firms — whereas the 2023 survey sample included these respondents. Response comparisons year-over-year have been estimated comparing 2024’s sample to the 2023 respondents who did not work in-house at non-accounting firms.

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