Accounting Forecast 2024

Accountancy leaders’ 2024 Predictions

Global accountancy leaders share accounting sector forecasts for 2024 with IAB Editor-in-Chief Zoya Malik.

Kamel Abouchacra, CEO, Crowe Global:  

Looking ahead to 2024, we anticipate an increased focus on digitalisation. Industry investment in artificial intelligence will continue to grow with a more robust governance structure to help mitigate risk and develop best practice approaches within the profession. Where private equity features in the accounting firm model, we can expect to see substantial financial investment in these firms to advance their technology solutions rapidly, helping to expedite digital transformation across the industry.  There will be continued emphasis by regulators globally and locally on improved quality in service delivery and management of firms.

Moreover, we also predict a shift towards strategic roles on people - emphasising soft skills and fostering stronger internal and client relationships. Staying abreast of regulatory changes, investing in continuous learning, and mastering technology integration will be crucial for success. Additionally, a focus on diversity and inclusion will contribute to innovation and better meeting the diverse needs of clients.

Finally, Environmental, Social, and Governance (ESG) considerations are increasingly becoming integral to business practices. We expect ESG will play a pivotal role in investment and strategic decision. We predict more emphasis on companies demonstrating a commitment to sustainability, social responsibility, and strong governance.

Jean Stephens, Chief Executive Officer, RSM International

In 2024, we are poised to witness a seismic shift in the way businesses operate as advanced technology meets new, non-financial reporting requirements with promises of transformational outcomes.

The stage is set amidst the introduction of the IFRS S1 & S2 and Corporate Sustainability Reporting Requirements, marking a watershed moment in reporting standards and heralds a new age of transparency and accountability in our industry. 

At the heart of this evolution lies technology - a formidable force that has permeated all traditional audit and tax services, while igniting a range of new cutting-edge consulting solutions. The integration of generative AI is revolutionising how businesses capture, analyse, and visualise non-financial data. As technology meets ESG, we will see historically disparate elements come together within a new paradigm of financial and non-financial reporting. 

Gone are the days when financial metrics alone shaped a company's narrative. Today, the narrative extends beyond profits and losses, and will instead, delve into the intricate fabric of an organisation’s environmental impact, social responsibility, and governance practices. This year, many businesses will be called upon to chart their sustainability journey, while others not immediately impacted by the new regulatory requirements would be advised to watch closely and learn.  

It is an exciting new era for those in the industry who will need to combine their depth of experience and expertise with continuous training to stay abreast of evolving regulations and technologies.  

For professionals, crucial to their success will be their ability to adapt, and their ability to interpret and communicate non-financial data while embracing associated technologies. These attributes will be instrumental in helping businesses drive transparency, accountability, and value creation as we all navigate this evolving reporting landscape.  

The accounting profession has always played a critical role in business and the economy. Serving as a cornerstone for business transparency, this role now extends to advocates for sustainability and resilience. 

For businesses, the fusion of advanced technology alongside non-financial data will bring new value beyond regulatory reporting: leveraging the insights captured from advanced technologies will help organisations to excel, enabling data driven strategies to make informed decisions that resonate with purpose. At RSM, we call this – human insights, powered by technology.

Over the last few years, tech disruptors have emerged with digital cloud-based platforms, rapidly developing new products and solutions which serve as direct competitors in the startup space and beyond. Consequently, tech-enabled accountancy partnerships have rapidly responded, forming at scale. Both are having a tangible impact on the very essence of traditional accountancy partnership models and catching the interest of the investors. 

It is easy to see why alternative sources of capital are keeping a close eye on accountancy with the combination of stable cash flows from a compliance-driven industry, matched with the growth potential of technology enabled services. Our industry offers both scalability and resilience during economic fluctuations. 

One thing that is certain is that over the next 12 months and beyond, our industry will continue to evolve at pace. These changes will be heavily influenced and impacted by changes in market forces, in legislation and in technology, but what will not change is the importance of our people. Our professionals’ judgement and insights will remain at the forefront of our interactions with our clients. It is on this basis that RSM’s current and future focus continues to be on upskilling, supporting and developing our people, and empowering them with technology.

Dr. Christian Gorny, CEO, ETL Global

We expect further consolidation of the market with smaller firms joining bigger groups or networks. Recently, this trend has been strongly pushed by the Covid-19 pandemic and the rising pressure on smaller players in terms of professional specialisation, technical skills, lack of talent and inflation.

Joining a bigger group or network helps smaller firms to solve those issues through synergies and existing infrastructure, with regard to both specialist technical or industry know-how as well as shared services in the context of HR, IT, communications, financing etc.

In addition, the audit profession is facing increasing regulation, and smaller accounting firms cannot afford to spend the money and time to comply with the standards and inspections of the regulators. This rising pressure on smaller players may boost the ongoing consolidation processes further in terms of speed and volume.

Last but not least, we still see a lot of firms lead by the baby boomer generation which may give another impetus once they start implementing their succession plans to hand over their businesses to the next generation.

Francesca Lagerberg, CEO, Baker Tilly International 

We expect modest growth in most regions for major professional services firms but led by North America and Asia Pacific. Europe will continue to be the laggard due to macro political and economic reasons.

Although the debate about multidisciplinary vs audit only won’t be so high profile as 2023 there will be plenty more of the ongoing discussions on managing risk and safeguarding audit.

We are likely to see more consolidation next year with alliances and mergers across the sector reinforcing the trend in 2023. PE will continue to be very actively interested in Accountancy firms although less in law firms and consultancies. And for the first time Asia Pacific is coming to the party.

Both these trends reflect the fact that for the first time Professional Services has become capital heavy rather than capital light. We all need the cash to pay for the tech – investing in AI for instance does not come cheap.

Regulation across the world will continue to intensify in 2024 – partly driven by the need to respond to audit failures but also to ensure confidence in the sector.

And we will continue to see a genuine war for talent in specialist areas like ESG or AI but also further fall out from post pandemic over optimistic hiring in advisory.

Expect to hear more, not least from me, about initiatives encouraging young people to enter the accountancy profession.

Stephen Hamlet, CEO, Russell Bedford International

We say with challenge comes opportunity. In which case, I feel 2024 will bring a lot of opportunities! I’ve heard people discuss how the accounting profession is to undergo significant unprecedented change. To some extent I can appreciate this. To another, I’m not so sure. When we talk about artificial intelligence impacting our profession, something that is undoubtedly happening, I question whether it is any different to the technological advances that entered our lives, and indeed the accounting industry, several decades ago. However, the two items that we have not tackled before are sustainability – the effect this has on businesses, the need to now report on such impact and hence the requirement for the accounting profession to get directly involved – and the significant increase in mergers and acquisitions and the influx of private equity investment into the accountancy industry. These two factors, I personally see, as those that need to be addressed and through which we need to seek opportunity.

Russell Bedford firms discussed these and several other topics at our 40th year anniversary global conference at the end of 2023. Another item of concern, of course, is the people shortage and the need to attract and retain more talent. However, I fail to see why the profession cannot achieve better promotion. It is surely exciting to be at the forefront of helping businesses with development and expansion and the advancements in technology further enhance the role of trusted advisor. Due to current shortages, however, I do predict even more organisations in the outsourced/offshore arena offering assistance to the accountancy practices. I do worry about the cultural divide and potential lack of collaborative spirit that might result. We talked a lot after the pandemic about getting people back into the office so that relationships can be cemented, to create that greater connectivity and yet I appreciate, in the main, remote staff and using extra resources from overseas has been working successfully for several accountancy firms.

And so, in conclusion, leaders need to be prepared for different practice models, to diversify their offerings and to attract the right people. The future can then be bright for such accounting firms, quickly implementing new initiatives and strategies to adapt to the changing needs of clients.

Pat Kramer, CEO, BDO Global

2024 brings continued integration of AI for automation, optimising processes and elevating data analytics capabilities that will drive deeper insights into data and risk assessment. Amidst increasing digitalisation, cybersecurity measures to safeguard sensitive financial data will be important. There will be a growing emphasis on sustainability reporting, requiring accountants to adapt and ensure that management includes relevant ESG disclosures. Lastly, accountants face heightened regulatory requirements, emphasising the need for enhanced quality, risk management protocols and ethical considerations. This will require an increased focus on upskilling talent, honing skills in digital and AI, along with analytical and soft skills.

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