How Has Covid Changed the Accounting Profession and Its Future

Covid has brought about significant changes in the accounting profession, forcing accountants to adapt to new challenges. The shift to remote work has become a permanent fixture, with 75% of accountants now working from home at least one day a week.

This shift has required accountants to invest in new technology, such as cloud-based accounting software, to stay connected with clients and colleagues. The increased use of digital tools has also led to a decrease in errors and improved efficiency.

Many accountants have had to learn new skills to keep up with the changing landscape, with 60% of accountants reporting that they have had to acquire new skills to remain relevant. This has included learning about new tax laws and regulations, as well as how to use new accounting software.

As a result of these changes, the accounting profession is evolving to become more tech-savvy and agile.

The pandemic has brought about significant changes to the accounting profession. Temporary changes have been made to accommodate remote work, with 75% of accounting firms adopting flexible work arrangements to keep staff safe.

Many accounting firms have had to adapt their technology infrastructure to support remote work, investing in cloud-based accounting software to enable seamless collaboration and data sharing.

One notable example is the increased use of digital signatures, with 90% of accounting firms reporting an increase in digital signatures since the pandemic began. This has not only reduced paperwork but also increased efficiency.

Remote work has also led to a shift in work-life balance, with 60% of accountants reporting an improvement in work-life balance since transitioning to remote work.

Temporary changes can be a real challenge, but understanding their nature can help us navigate them more effectively.

Temporary changes are reversible, meaning they can be undone or changed back to their original state.

They often result from external circumstances, such as a job change or a move to a new home.

In contrast to long-term changes, temporary changes tend to be more situational and context-dependent.

A good example of a temporary change is a student taking a semester off from school, which can be a temporary adjustment to their usual routine.

Temporary changes can be a great opportunity for growth and learning, as they allow us to adapt to new situations and develop new skills.

However, they can also be stressful and overwhelming, especially if we're not prepared for the transition.

In the end, temporary changes can be a valuable stepping stone to long-term growth and development.

Long-term changes are a crucial aspect of personal growth and development. They often require more effort and dedication than temporary changes, but can lead to lasting benefits.

Temporary changes are a stepping stone to long-term changes, as seen in the example of a person who starts exercising regularly to lose weight, which can eventually lead to a healthier lifestyle.

The brain's neural pathways can be rewired through consistent effort, making it possible to develop new habits and thought patterns that stick. This process can take time, often several months or even years.

A person's environment and social circle can also influence long-term changes, as a supportive community can provide motivation and accountability. For instance, joining a fitness group or finding an exercise buddy can make it easier to stick to a workout routine.

Research has shown that it can take around 66 days for a new habit to become automatic, but this timeframe can vary significantly from person to person.

The COVID-19 pandemic has had a significant impact on the accounting profession.

More than half of NYSSCPA members reported that the pandemic has made conducting work more difficult due to social distancing, remote locations, and other factors.

Increased difficulty in communicating and collaborating with colleagues was mentioned by more than half of respondents, while slightly under half were concerned with being exposed to the coronavirus while on the job.

Firms that already had at least one cloud system in place prior to the pandemic fared far better than firms that did not have any cloud systems in place.

The majority of firms (62%) who felt they are responding to COVID-19 successfully are more likely to be using cloud-based technology, particularly cloud-based document management and online client portals.

Firms which identified themselves as being less successful in their response to the pandemic are putting more energy into incorporating new technology to enable remote work and communication with team members and clients.

The firms that were more successful in dealing with the pandemic offered virtual collaboration tools to their clients at a higher rate than firms that were less successful.

Here are some key statistics on the impact of COVID-19 on the accounting profession:

A full copy of the report is available to members of the accounting profession at https://www.smartvault.com/resource/state-of-accountants-covid-19-impact-report/.

The COVID-19 pandemic has forced the accounting profession to adapt quickly, and one of the key areas of change is crisis response and adaptation.

Many accounting firms have had to rapidly shift to remote work, with some firms seeing a 90% increase in remote work arrangements within just a few weeks of lockdowns being implemented.

Accounting professionals have had to learn new technologies and tools to stay productive and connected with clients and colleagues while working from home.

In some cases, this shift has also led to a decrease in staff turnover, as employees have been able to maintain a better work-life balance while working remotely.

However, the pandemic has also highlighted existing inequalities in the accounting profession, particularly for those with limited access to technology or remote work arrangements.

Effective crisis response requires a clear understanding of the situation and a well-planned strategy. This involves identifying the root cause of the crisis, assessing the impact, and developing a response plan that addresses the needs of all stakeholders.

A crisis response plan should include a communication strategy to inform and reassure affected parties. Communication is key in a crisis, and timely updates can help prevent misinformation and panic.

In a crisis, it's essential to prioritize the safety of people and the environment. This means taking immediate action to mitigate the damage and prevent further harm.

A crisis response team should be established to coordinate the response efforts and ensure a consistent message is communicated to the public. This team should include representatives from various departments and stakeholders.

A crisis response plan should also include a recovery strategy to help affected parties rebuild and recover. This may involve providing resources and support to those in need.

By having a clear plan in place, organizations can respond quickly and effectively to a crisis, minimizing the impact and helping to restore stability.

Environmental Adaptation is all about learning to thrive in the face of adversity. It's a crucial part of crisis response and can make all the difference in getting back on your feet.

Adaptation requires a willingness to pivot and adjust to new circumstances. This was evident in the case of the 2010 Deepwater Horizon oil spill, where BP's initial response was inadequate, but they eventually adapted to the situation and implemented a new containment system.

The ability to adapt is not just about responding to immediate needs, but also about preparing for future crises. This is why having a robust emergency plan in place is essential.

Studies have shown that organizations that are able to adapt quickly to crises are more likely to recover and even thrive in the long term.

More than three-quarters of accounting professionals no longer work full-time in their offices. A slight majority now works remotely due to COVID-19, while another 25% work mostly remotely. One-quarter of respondents mentioned that there has been no change to their work arrangements due to COVID-19.

Employers are adapting to the new normal, with one-quarter planning to sell physical office space or terminate/opt-out of rented office space leases. Another half plan to keep some or all staff working virtually after the pandemic subsides.

Here are some key statistics on employer actions:

This shift towards remote work is likely to reduce firms' traditional need for office space, which could have a significant impact on the commercial real estate market.

In the survey, 80% of respondents reported no change to their employment status.

The remaining 20% of respondents experienced various job losses. Of these, 3% had been furloughed.

A significant number, 6%, had lost their jobs.

The COVID-19 pandemic has brought about significant changes in working arrangements. More than three-quarters of survey respondents no longer work full-time in their offices.

Remote work has become the new norm, with a slight majority working remotely due to COVID-19, while another 25% work mostly remotely. One-quarter of respondents mentioned that there has been no change to their work arrangements due to COVID-19.

This shift to remote work is likely to continue even after the pandemic subsides, with half of respondents planning to keep some or all staff working virtually. This will reduce firms' traditional need for office space, potentially having a significant impact on the commercial real estate market.

Here's a breakdown of the current working arrangements:

As a result of this shift, firms will need to adapt their office space needs, with one-quarter planning to sell physical office space or terminate/opt-out of rented office space leases.

Accountants are worried about the impact of COVID-19 on their profession, with three-quarters of respondents concerned about the economic impact on their industry.

Their top concerns include dealing with constantly changing rules and requirements for pandemic assistance programs, finding new clients without in-person networking, and staying connected with clients and staff.

The biggest challenge accountants face is keeping up with the changing laws and guidance on programs like PPP, as well as finding new clients and staying connected with existing ones.

Here are the top challenges accountants face in their businesses:

To survive the pandemic, accountants are adopting various strategies, including offering clients advice on PPP and other pandemic relief programs, investing in marketing and sales, and offering cash flow management advice.

Client cancellations due to the pandemic have been a concern for many accounting firms. On average, firms lost 4% of their clients, but the impact was highly variable.

Some firms were hit harder than others, with a few losing nearly 50% of their client base. This is a stark reminder that every firm is different and will face unique challenges.

Firms that reported no client losses due to the pandemic were a surprising 44%. Of these, half were solo practices, while 25% had 2-10 employees.

These firms often had diversified client bases, serving businesses across multiple industries. This diversification likely helped them weather the storm.

It's worth noting that respondents may have had different criteria for determining whether a client loss was pandemic-related. This could affect the accuracy of the results.

More than three-quarters of accountants are concerned about the overall economic impact of COVID-19 on their profession or industry.

The biggest challenge accountants are facing is dealing with the constantly changing rules and requirements for pandemic assistance programs, including loans and grants, as well as tax credits, extensions, and other changes.

Under 30% of accountants ranked losing clients as their #1 concern, which is surprising given the common perception that client loss is a major worry for accountants.

The most common concerns among accountants include finding new clients, especially without the ability to do in-person networking, and staying connected with clients and staff.

Here are the top challenges accountants are facing, in no particular order: