Many accounting firms may unwittingly harbour inefficiencies that drain their time, resources, and, ultimately, their ability to remain profitable.
Recognising their inefficiencies in the fast-paced business landscape can boost your accounting practices and make you more competitive.
This article will unveil four accounting practice inefficiencies and strategies to overcome them. Read on to learn more.
Non-Standardised Accounting Practices
According to research from Sage, 87% of accounting clients expect more flexibility and better service levels from their accountants without an increase in their rates. This shift in client demand places pressure on firms to standardise their practices so they can ensure that each accountant is delivering an effective service rather than just solving their clients’ problems in their own way, leading to inconsistencies, errors, and wasted time.
Creating Standard Operating Procedures (SOPs) in accounting is crucial and involves creating step-by-step guides for everyday tasks that can be shared and actioned efficiently across your organisation. First, you must agree on the functions for which you need a SOP and how you will document it (we suggest video and text-based SOPs using tools like Loom and Scribe).
It would help if you also make all team members accountable for following SOPs and updating them when needed to ensure your team works efficiently. Accounting teams with SOPs can increase employee productivity and satisfaction, plus, clients can be reassured that if their accountant contact is absent or changes role, there will be no disruption or delay in the firm’s service output.
Scope Creep
Scope creep is a silent productivity and profitability killer for accounting firms. It occurs when accountants agree to perform extra tasks outside of their contracted list of services. While going above and beyond in your work can attract positive customer reviews, it can also lead to accounting team burnout.
Indeed, findings from YouGov reveal that 58% of accountants feel uncomfortable turning down tasks outside their agreed workloads. Furthermore, 33% of accountants polled report that their mental health suffers when they put off client conversations about unrealistic service expectations.
The way to counter accounting scope creep is to clearly define clients’ workload at the accounting client onboarding stage with details on deliverables and timelines. Moreover, clarify how a change in scope will incur extra fees and provide concrete examples of additional tasks that may come up so clients can understand any charges before they ask. You can also use project management software to help you calculate accountants’ time spent on each task and price agreements accordingly.
Inefficient Accounting Client Onboardin
Start your client relationships on the right note by creating an open forum for clients to ask questions and check documentation at the onboarding stage. This can help firms streamline their accounting practices and avoid miscommunication, delays, and incorrect client information.
Your accounting client onboarding procedures should include explaining your firm’s processes, asking about their preferred communication methods, and setting expectations for engagement. You can also set up automated email reminders to help you save time and effort keeping up with client correspondence.
Manual Data Entry
Eliminating as many manual data entry tasks as possible not only helps you boost efficiencies, but it can also help you avoid errors. For example, investing in optical character (OCR) technology will help you extract text from paper or handwritten documents. Many accounting software packages can also help you automatically import financial documents and highlight areas that require your attention.
Investing in the latest document processing tools can be the best way to help your team redirect their focus from mundane, time-sucking tasks to higher-value activities like client advisory services and growing your business.
INAA: Helping You Build a Successful Streamlined Accounting Firm
Here at INAA, we keep up to date with the latest accounting and auditing practices to help our members work smarter, not harder.
Through our events, resources and one-on-one networking opportunities, you can enhance your firm’s efficiencies and position yourself as a forward-thinking client-centric service in an increasingly competitive market.
To learn more, check out our benefits for INAA member page, and sign up with us today.