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Accounting Outlook | Change is Good for CPA Firms’ Business

Accountants play a major role as commerce adopts new technologies

By LaneReport.com staff

Accounting firms are seeing demand for their business driven by broad technological change in the ways their clients operate and public policy changes that necessitate revising business strategy. In a strong economy, tech is taking over how financial services are provided to make it faster and more accessible, and how business data is gathered
and analyzed.

Kentucky CPA firms are finding themselves right in the middle of it all, needing to offer expert advice to help their clients stay competitive and protect not only their data but the content of their revenue streams. Meanwhile, the Tax Cuts and Jobs Act of 2018 has renewed the evergreen need for good, direct-interaction client service. In addition, CPA firms are competing for the new generation of talent that is comfortable with today’s technology.

“Going into the new year, I’d say we are all going to have to adapt to the new normal: that of unrelenting change. The organizations best suited to thrive will be those that can deal with change effectively and efficiently. Despite low unemployment and a strong holiday season, economic uncertainty is at an all-time high, thanks largely in part to the tariff environment nationally (not to mention internationally), and here in Kentucky the unaddressed pension situation. Adaptation is critical. Companies must be able to pivot. Human capital remains our most important asset, but we need to remain nimble in how we hire for the right kinds of skills for today’s economy, as well as tomorrow’s. This is just as true for accounting as it is for the manufacturing or technology industries.”  — Diane Medley, Managing Partner, MCM CPAs & Advisors

“It’s been said that the pace of change is as slow as it will ever be. In 2018 we learned more about blockchain, Big Data, augmented reality, artificial intelligence, robotic process automation and cybersecurity, just to name a few. In 2019, I expect these technologies to become more mainstream and impact the role of the accountant as an advisor to their clients and employers. These technologies will provide opportunities for growth in new client services and allow certified public accountants to focus more on higher-level and forward-thinking strategic analysis and consulting. CPAs will be depended upon even more to offer guidance and risk assessment as businesses maneuver through disruption and a fast-paced environment that’s in a constant state of change.” — Darlene Zibart, CEO, Kentucky Society of CPAs

“2019 will be a time of great change for professional services firms, but this is nothing new to accounting. Today, there are articles everywhere on chatbots, cryptocurrency and artificial intelligence taking over the accounting scene. As technology continues to replace many of the formerly tedious tasks we once had, I see our jobs shifting to infusing the human element back into the process. Our duty this year will be to take the data that has been collected and analyzed and create a narrative for our clients. More than ever, those of us in the accounting profession will need to be that bridge that connects all of this technology to meaningful human interactions and, ultimately, business decisions. 2019 will welcome into the workforce Generation Z, which is extremely tech savvy, having never known a time without smartphones. They grew up during the Great Recession and value job stability. They ardently read online reviews and look for organizations with strong brands they can relate to. This will require new strategies for recruiters as this generation’s expectations become the norm. And there’s tax reform – an example of no matter how much things change, the need for good old-fashioned client service remains.” — Greg Mullins, Director, Blue & Co. LLC

“Many terms describe for-profit, impact-driven business models: social entrepreneurship, conscious capitalism, social enterprise, etc. With the passage of public benefit corporation (PBC) legislation in Frankfort, the launch of organizations like Canopy Kentucky, and strong Cabinet for Economic Development support, I see this global movement becoming a focus for businesses in our region in 2019. With a long reputation for using business as a force for good, our firm is making Kentucky attractive and friendly for social entrepreneurs through our partnership with Canopy and collaboration with business leaders who measure success by more than numbers. The impact will be notable in terms of economic development, talent attraction and developing innovative solutions to Kentucky’s biggest issues. Talent attraction will continue to be a challenge; traditional accounting firms will need to broaden their business model, become more agile, embrace digital solutions such as artificial intelligence and offer more flexible work cultures to attract young professionals. Because today’s professionals seek meaningful work in addition to a career, firms that are purpose-driven will have an edge over more profit-focused firms.” — Christopher A. Ward, President, Deming Malone Lively & Ostroff

“2019 has the potential to be a good year for business. The uncertainty from the political climate could put a damper on the strong fundamentals that are present. Unemployment is low and skilled workers are in great demand, which normally helps drive the economy in the right direction. Accounting firms should have a great year in 2019 due to several factors. First, the tax law change that is in effect for this filing season will generate more work, as there are several difficult changes in this new law that affect most all businesses. Second, the disruption in the industry due to technology will also continue to push firms to offer more and different services that businesses are demanding from their accountants. The biggest issue facing accounting firms and all businesses is finding competent and skilled employees. This is making it harder for accounting firms to grow at a faster pace. This is making firms look at their business models and adopt more technology in order to provide clients with the services they are requesting.” — Alan Long, Managing Member, Baldwin CPAs

“In 2019, companies will see how the Tax Cuts and Jobs Act has played out in practice as the upcoming tax deadline approaches. In Kentucky, even though the commonwealth’s underfunded pensions continue to be an issue, the pro-business administration has led to a stronger statewide economy. We see evidence of this in our client base as companies continue to make investments in people, capital expenditures and acquisitions. Crowe continues to grow in Kentucky with the Crowe Lexington office relocating and doubling its square footage. We also recently expanded our campus efforts with the University of Kentucky and hired our highest number of graduates and interns. Companies continue to try to understand and evaluate the threats of cybersecurity and look to us for guidance on preventing and responding to these threats, which is why we established the firmwide Crowe Security Intelligence Center in Lexington.” — Steve Jennings, Lexington Office Managing Partner, Crowe LLP

“Despite rising interest rates and recent stock market volatility, we see the U.S. and Kentucky economies starting 2019 on solid footing. Unemployment remains low in the U.S. and Kentucky at around 4 percent. Competition for talented employees remains intense across all industries, including for the best and brightest CPAs. The Tax Cuts and Jobs Act will continue to create opportunities for us to guide our clients – businesses and individuals – through the changing tax landscape. We continue to invest in technology resources to help our clients with technology challenges and initiatives such as cybersecurity, and implementing cloud-based software platforms to improve accounting and financial management.” David Bundy, President/CEO, Dean Dorton