The world of accounting is complex and continuously evolving. To help you stay up-to-date, we've compiled 47 interesting accounting statistics from the industry summarized into some key topics that are worth knowing about. Accounting industry statistics can help you stay on top of the latest changes in your industry and help you stay informed.
Let’s dive in.
General Accounting Statistics
First, some interesting general stats about the accounting industry overall:
The accounting industry is one of the largest in the world.
1. The accounting services global market value was $544.06 billion in 2020. (Research and Markets)
And the industry is growing!
2. The market is expected to reach $735.94 billion in 2025. (Research and Markets)
The large accounting market is shifting, though.
3. 90% of accountants worldwide believe there has been a cultural shift in accountancy. (Sage, 2019)
This shift brings upon many challenges for accounting firms.
4. According to the Accounting Today 2022 Year Ahead Survey, 51% of firms said their biggest challenge is keeping up with regulatory change.
Other significant challenges firms face include recruiting/retaining good employees, acquiring and retaining new clients, keeping up with technology, the overall economy, and clients' economic health. We will look at some interesting stats that have to do with many of these challenges.
There are also many accounting statistics regarding changing regulations.
The pace of legislative change has not slowed, and keeping track of legislative changes posed a problem for many firms.
5. More than 50% of surveyed firms have struggled to keep up with legislative changes. (Wolters Kluwer)
6. Despite these challenges, 36% of small firms and 45% of large firms reported this year’s tax season was somewhat or much better than last year. (Wolters Kluwer)
Keeping up with legislative changes can be difficult, but there are ways to automate many time-consuming tasks, so more focus can be on tasks like these that are very important for your firm and your clients.
A significant contributor to accounting firm success is the right employees. A big challenge for accounting firms is recruiting and retaining good employees. Recruiting and retaining the right staff has never been more critical for success and it’s also never been more challenging. This is due to numerous reasons. For example, the changing demographics and the need to appeal to the younger generation.
7. 84% agree that as ‘digital natives’, prospective employees from younger generations have progressive expectations, attitudes and talents that will need to be reflected and nurtured by accounting firms if they hope to attract them. (Sage, 2020)
This younger generation and existing accountants will need to adapt and learn new skills that are not traditionally taught in accounting programs to excel in the industry as it changes with technology and other client expectations.
8. 62% agree that today’s accountancy training program will not be enough to run a successful practice by 2030. (Sage, 2019)
9. 82% of accountants said they are considering recruiting from a non-traditional background. (Sage, 2019)
10. 51% believe accountants joining the profession today need financial business advisory skills such as cash flow and growth modelling. (Sage, 2020)
11. 57% said technology literacy is the leading additional skill accountants need. (Sage, 2019)
Another critical aspect of retaining good employees is ensuring they are satisfied with their accounting jobs.
12. More than one-third (36%) of finance and accounting professionals expressed satisfaction with all aspects of their job. (Monster)
13. 41% of accounting and finance professionals said that solving problems gives them the most satisfaction in their careers. (Robert Half)
14. More than 60% of large firms report technology is helping with staff engagement and morale - two factors critical to retaining staff. (Wolters Kluwer)
When looking at recruiting talent for accounting firms, some interesting stats look at diversifying the workplace and the importance of firm reputation.
15. 30% of firms say they’re actively seeking to diversify their workforce(Sage, 2019)
16. 40% of new staff join a practice over its competitors because of its reputation(Sage, 2019)
Offering a competitive salary is also key to attracting and retaining quality employees.
17. According to Indeed, the average salary of an accountant is $55,459 per year, while the average salary of a designated CPA is $65,289 per year.
18. On average, accountants and auditors earned a median annual wage of $73,560 as of May 2020, according to the U.S. Bureau of Labor Statistics (BLS) report.
However, these numbers can vary significantly depending on your industry, experience, skills, and location.
Since the pandemic, accounting firms are moving toward a more virtual work environment. Let’s check out some interesting accounting statistics on this.
Across the US, firms face a shortage of skilled staff. The “Great Resignation” ,has firms battling high turnover caused largely by pandemic burnout and changing professional preferences. All firms with cloud accounting solutions can now benefit from attracting talent and clients across broader geographic locations. It also allows workplace flexibility and better work-life balance. (Wolters Kluwer)
19. Eighty-one percent of firms anticipate a moderate to significant increase in remote work post-pandemic. (ConvergenceCoaching's 2020 Anytime, Anywhere Work Survey)
20. Most tax returns were prepared this year with no in-office contact with taxpayers. On the audit side, there was much less in-person interaction with clients. (Wolters Kluwer)
21. 43% of firms are making moves to downgrade their brick and mortar presence and or transition to a virtual-only presence (Wolters Kluwer)
As accounting professionals, it's essential to understand what your clients need and expect. Accounting statistics in this area show exactly what that is.
22. Around 70% of small businesses don’t have an accountant, and more than half of those businesses rely entirely on their owner or manager to handle their finances. (Onpay)
23. 23% of small businesses said they would likely switch accountants within the following year. (Onpay)
24. 49% said when they decide to look for an accountant, recommendations from other professional advisors are the most critical resource for small business owners. (Onpay)
Just as the workforce is changing, so are your clients as the next generation are business owners and need accountants who know what they’re looking for.
25. 50% of millennials are looking to replace their accountant. A staggering number! One out of 5 wouldn’t even recommend the advisor they’re currently with. (Xero)
26. 39% of millennials are seeking an advisor that’s “enjoyable to work with.” (Xero)
Here’s some important stats from the latest surveys about client expectations.
27. According to Sage Practice of Now 2020 report, 87% agree that clients expect more flexibility and better service levels from accountants, without an increase in their rates.
Your accounting firm's digital marketing and communication strategy should reflect this need for flexibility. For example, accounting firms could offer online appointment booking and/or easy-to-use software for gathering client information.
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Expanding Service Offerings
Accounting firms need to expand their service offerings to meet client demands.
28. Only 61% of small businesses are satisfied with the breadth of services their accountant offers.(Onpay)
29. 82% of accounting firms report that clients expect more services and resources from accountants today than they did five years ago (Sage)
Forward-thinking firms are working to meet the evolving needs of clients. Expanding advisory and consulting services requires firms to move beyond a compliance mindset and empower professionals to make decisions and add value for clients.
So if you're looking to expand your business, it's important to consider what other services you could offer your clients.
30. 79% of firms surveyed are confident about providing business management and advisory services like cash flow management to business owners. (Sage, 2020)
31. 75% are confident about providing industry specific advice for clients such as standard profit margin for small business owners. (Sage, 2020)
32. 73% are confident providing technology implementation recommendations like AI and accounting automation. (Sage, 2020)
Many firms — particularly large ones — expect to increase their focus on advisory in 2022, but interestingly, many also expect to increase the amount of time they spend on compliance work. To make up the difference, they expect to decrease the amount of time they spend on client administrative work. (Accounting Today 2022 Year Ahead Survey)
Offering these additional services will definitely add value to what you can offer your clients but training your employees to perform these services is very important.
33. 63% are training or planning to train around financial business advisory services. (Sage, 2020)
The accounting profession is quickly adapting to new technologies, such as artificial intelligence to remain competitive.
34. 85% of accountants believe that the profession in their country needs to pick up the pace of technology adoption to remain comeptitive internationally(Sage, 2019)
35. A recent study found that 45% intend to automate repetitive, time consuming accounting tasks, such as data entry. (Sage, 2020)
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36. 58% of accounting professionals are expected to be automating accounting tasks using artificial intelligence solutions within the next 3 years. (Sage, 2019)
Like it or not, accounting is becoming more and more reliant on technology so if you’re not already using these technologies in your practice, it’s time to.
Technology will help improve efficiency, so you are able to add additional service offerings for your clients.
37. 58% said updating technology has improved efficiency and productivity - vital for creating space for adding service offerings clients demand (Sage, 2020)
38. 91% said technology allows them to focus on their clients or simply be more productive (Sage, 2020)
39. Firms now rely on technology to drive higher productivity, increase staff engagement and a better client experience. This year, 90% of small firms and 94% of large firms are looking to technology to help achieve an improved tax season. (Wolters Kluwer)
Perhaps your firm was an early adopter of technology but may not utilize it to its full potential.
40. Nearly 40% of all firms said they were either innovators or early adopters of technology. (Wolters Kluwer)
41. Only 7% of small firms and 2% of large firms believe they are 100% maximizing the value of their current technology. (Wolters Kluwer)
Or maybe you feel like you don’t have the budget to implement the technology right now.
42. In Accounting Today 2022 Year Ahead Survey, the tech budgets for small and midsized firms rose by roughly 2% from last year, but the budget spent on tech at large firms actually decreased by 1.6%. Large firms are much more likely to expect to spend more on tech in 2022, versus small firms
The trend of technology, especially in accounting, is here to stay, so your firm must be well-positioned to handle all of the changes in the future.
43. Overall, 32% of respondents state that they’re extremely confident their firms are well-positioned to handle all the technology advancements and information challenges due to current market conditions. (Wolters Kluwer)
With this new remote work lifestyle emerging and the need to access information from anywhere at any time, the accounting software industry is moving towards cloud accounting software.
44. The global accounting software market value is expected to reach $735.94 billion in 2025 (Research and Markets)
45. The cloud accounting market is growing and is projected to reach 4.25 million by 2023. (Flexi)
46. 67% of accountants prefer cloud accounting and believe that cloud technology makes their businesses more successful. (Sage)
47. 53% of them have already adopted cloud-based practice management solutions for project management and communication with clients (Sage)
There you have 47 accounting statistics from the industry that accounting firm owners should know. Keep these in mind as you continue to grow your business, and remember that the accounting industry is constantly changing, so it's essential to stay up-to-date on the latest trends and accounting statistics!