A recent report has revealed that UK accountancy firms are losing a significant amount of money, estimated at over £5bn, each year. The report by cloud software company Silverfin has found that a lack of up-to-date systems and old, outdated processes are to blame for these inefficiencies. Let’s look at the findings in more detail.
What is the problem?
Silverfin’s report, released this year, highlighted that full-time accountants were losing up to £48,000 per year in billable hours, which could have been recovered had their inefficient systems been addressed. This is due to a variety of factors that are plaguing the sector, with administrative tasks and operations taking up a huge amount of accountants’ time.
The report states that for firm partners, only a small percentage of their time is used for planning and strategy. For each hour a partner spent on advising their clients, they spent an hour and a half on internal and administrative work.
The time-consuming tasks that absorbed most of the partners’ time included chasing their clients and their colleagues, compliance tasks, and lengthy and manual data entry jobs. Essentially, accountants’ time is drained, often due to poor or out-of-date systems.
Another issue is a lack of real investment in digital growth, with just 8% of firms’ time being spent on introducing new digital solutions or technologies despite the sector’s acknowledgement that automation and technology are important areas for overall growth. For those seeking expert accountants Chippenham, companies such as https://chippendaleandclark.com offer solutions.
What is the solution?
There were a few positives revealed by Silverfin’s research; for example, firms are positive about implementing artificial intelligence, finding that it helps to save time. The use of AI is expected to continue and increase throughout the sector.
Since accounting inefficiency is becoming a real drain on the economy, and with some staff resistant to bringing about the changes that digital solutions bring, turning the situation around may be tough; however, once firms begin to seriously reevaluate their digital and technological strategies, real change can occur.
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