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OUTLOOK & ANALYSIS

Accountants Bullish on the 2024 Outlook

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But big challenges loom.

By CPA Trendlines Research

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No question about it: the 2023 tax season was a banner year. Generally speaking, revenues were up, profits were up, no quarantines and the IRS didn’t pop any surprises in the middle of it.

MORE: SURVEY: Accountants Economic Outlook Brightens | Tax Pros Are Expanding and Earning More | Research: Accounting Pros Cautiously Optimistic about Generative AI
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Yes, it was also a tough year, with staff shortages increasing the workload on practitioners, but it was that extra work, unburdened with payroll costs, that led to higher profits.

So what’s up for next year?
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MANAGEMENT

PCPS MAP: Profits and Pay Lag behind Revenue Gains at CPA Firms

Revenue grows 11%. Profit trails at 4%. Entry-level salaries not ‘competitive.’


By CPA Trendlines Research

CPA firm revenues are growing strongly, but profits and entry-level salaries are failing to keep pace, according to new survey data analyzed by CPA Trendlines.

MORE in SURVEYS & RESEARCH: Firms Rev Up Expansion Plans | Overcoming the Five Hurdles to Advisory Services | Research: Accounting Pros Cautiously Optimistic about Generative AI | Why Compliance Still Matters. But It’s Not Enough. |  New Businesses Mean New Business | How to Transform Your Team into Trusted Advisors

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Although the average base salary for new entrants to the profession increased by $5,000 to $50,000 in the fiscal year 2022, this still lags behind comparable pay in fields such as engineering, the AICPA says in commentary accompanying the new 2023 National Management of an Accounting Practice Survey, adding "competitive compensation is crucial to firms’ ability to attract talent."

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PRICING, FEES & BILLING RATES

Tax Pros Are Expanding and Earning More

Study finds that more than half don’t WANT to grow.

By CPA Trendlines Research

Tax preparers are pulling down some respectable bucks, and many are expanding their services to find more clients and handle more complex work, according to the 2023 Tax Professional Fee Study produced by the National Association of Tax Professionals.

MORE: With Fresh Funding, IRS Shows Service Improvements | How Tax Practitioners Became Cybersecurity Risks | Top Tax Vendors Caught Red-Handed Selling Private Taxpayer Data
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The study finds that a vast majority report raising their fees regularly. A solid 49 percent increases fees yearly and another 28 percent every two years. The most recent increases were 6 to 10 percent for 40 percent of respondents, though 34 percent limited themselves to 1 to 5 percent raises. Nine percent jacked up fees by more than 16 percent.
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OUTLOOK & ANALYSIS

Staff Need Good Pay and TLC

table of responses

They’re scarce. Here’s how to keep them happy.

By CPA Trendlines Research

It’s no news to the accounting industry that staff and professionals are hard to find and hard to keep from wandering off to some other firm.

MORE: SURVEY: Accountants Economic Outlook Brightens | The 7 Categories of Cybersecurity Solutions Firms Need | Understanding the Full Cost of a Data Breach | Research: Accounting Pros Cautiously Optimistic about Generative AI | How Auditors Can Beat AI | Why the U.S. Must Act Now to Protect Our Online Privacy
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And the law of supply and demand hasn’t failed to rule, according to the Global Talent Trends 2023 survey of the Association of Chartered Certified Accountants: Scarce employees expect a good salary, good treatment and a chance to work outside the office.

Identifying and dealing with these employees’ expectations is essential to a continuous and successful flow of business. The survey found five challenges to that flow.
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