“The accounting services global market value is expected to reach $735.94 billion in 2025.” – Publicist paper
This exponential growth of the audit and accounting business landscape can be dedicated to multiple factors, such as digitization, technological advancements, evolving tax legislation, etc. However, despite the growth, this hyper-competitive sector faces numerous challenges like market volatility, skill shortages, cost pressure, etc.
Therefore, every accounting firm must implement appropriate measures to optimize its workforce and stay ahead of the competition. Since resources are the most significant investments in this sector, it will help them tap into the workforce’s maximum potential and enhance business efficiency.
This blog explains how SAVIOM’s resource management software can help you achieve optimal resource utilization and enhance productivity.
But before that, let’s start with the basics.
1. How do audit and accounting firms function?
Auditing and accounting firms typically function by providing professional services related to financial reporting and analysis. It includes auditing financial statements, providing advice on accounting practices, and preparing tax returns. These firms also assist businesses with cash flow planning and management, routine audits, and more.
Some of the different types are-
1.1 Audit firms
The primary role of an audit firm is to provide an independent and objective opinion on the accuracy of a company’s financial statements and ensure that it complies with accounting regulations. Forensic accountants, risk analysts, tax advisors, etc., are the professionals working in these firms.
1.2. Outsourced accounting firms
Outsourcing accounting firms offer accounting and bookkeeping services to their clients on a contractual basis. They also provide advice on financial reporting and analysis and help clients to improve their monetary operations. Some of the employees working in these firms are- freelancer auditors, accountants, consultants, etc.
1.3. Bookkeeping firms
Bookkeeping firms maintain accurate and up-to-date financial records, such as recording transactions, preparing financial statements, and managing accounts payable and receivable. The two most essential employees in these firms are accountant software specialists and full-charge bookkeepers.
Now that we know the nitty-gritty of audit and accounting firms let’s read about the benefits of resource optimization.
2. Significance of resource optimization in audit and accounting firms
Here are five crucial benefits of resource optimization in audit and accounting firms-
2.1. Bridges the capacity vs. demand gap of auditors
Due to a lack of foresight into future audit and accounting projects, organizations often fail to identify the resource demand for consultants with their corresponding competencies and skill sets. This often translates to skill shortages, cost overruns, project delays, and compromised deliverables.
In this case, managers should proactively foresee the demand for pipeline assignments and implement resourcing measures to bridge the gaps. Managers can either undertake planned hiring or devise training programs if there is a shortage of consultants. On the contrary, for excess employees, managers can bring forward pipeline projects or sell them at a discounted rate. Thus, in this way, these firms can avoid last-minute firefighting, prevent cost escalations, and maximize productivity.
2.2. Enables competent allocation of audit and accounting staff
Capability optimization enables audit/ accounting managers to allocate the right audit and accounting personnel to the right task. With complete visibility into resource-related data and their current and future schedules, the manager can identify and select consultants with relevant experience and competencies for projects.
Thus, competent resource allocation helps avoid assigning over or under-skilled auditors/accountants to projects and prevents double booking and overloading. Moreover, it increases audit and accounting staff’s productivity levels and performance as they are allocated work according to their skill set.
2.3. Helps create the right mix of consultants
In the audit and accounting sector, a blended workforce can be beneficial for managing fluctuations in demand for services, such as during peak tax season. By analyzing the nature of project demands, managers can form a balanced mix of permanent and contingent consultants.
Here, the on-demand workers can provide additional support during busy periods, while permanent employees can focus on core functions. This reduces the workload of critical audit and accounting staff and enables other resources to gain more hands-on experience and exposure. Moreover, it also supports cost optimization as on-demand employees have fewer overhead charges and lower hiring expenses.
2.4. Facilitates optimal utilization of resources
Since billable resource utilization is critical for maintaining healthy profit margins, resource managers must allocate accounting consultants to revenue-generating activities. With proper visibility into consultants’ current and future bookings, managers can avoid instances of under/overutilization and implement measures to prevent sub-optimal utilization.
Using optimization strategies such as resource leveling and smoothing, managers can resolve overutilization and avoid employee burnout. On the other hand, if a consultant is working on admin tasks for the majority of their capacity, the supervisor can mobilize them to billable activities. It will help enhance the billability of the consultant, optimize utilization levels, and improve organizational profitability.
2.5. Futureproofs the audit and accounting workforce
The emergence of technologies, such as AI, ML, etc., has made it imperative for accounts/auditors to acquire technical skills and digitally transform their work. Implementing suitable training/upskilling programs, IDPs, etc., enables employees to align their skills with the latest trends and optimize their capabilities.
For instance, accountants can be trained in data analytics to create accurate financial reports with a large amount of data and streamline their workload. In addition, they can also offer learning methods, such as peer-to-peer coaching, job shadowing, etc., to prepare accounting staff to work on multi-faceted projects in the future. Further, these initiatives will help bridge existing skill gaps, and improve performance, enabling the firms to stay relevant in the digital age.
Now that we know the benefits let’s understand how robust ERM software can help.
3. How can advanced resource management software help?
A modern ERM software can be a one-stop solution to plan, forecast, and build an optimized accounting workforce. Here’s how-
- The tool offers 360-degree visibility into the audit and accounting firms’ resource pool and their attributes like- skillsets, availability, competencies, etc. Thus, managers can identify the right resources and allocate them to suitable projects.
- Further, the tool provides capacity vs. demand reports that helps managers predict resource demand of current and pipeline projects. This makes it possible to allocate employees more efficiently and reduce resource shortages in the accounting and auditing company by bridging the demand vs. capacity gap.
- Additionally, the ERM tool offers heatmaps and forecast vs. actual utilization reports, which reveal whether a resource is being over or under-utilized. Because of this, accounting managers can adopt various measures and ensure optimal utilization.
- Furthermore, managers can use the modeling and simulation techniques within the tool to analyze various project scenarios and create the most viable resource plan.
In a nutshell, resource management software can be a game-changer in optimizing the audit and accounting workforce.
4. The Bottom Line
A proper resource optimization strategy can enhance the productivity and performance of employees. Therefore, by combining the right strategies with efficient resource management software, audit, and accounting firms can maintain a highly skilled talent pool and utilize them optimally, ensuring profitability.
So, are you ready to implement resource optimization techniques and reap the above benefits?