‘State of the Industry’ report reveals more than half of Australian advisors expect revenue growth
Accountants and bookkeepers are preparing for expansion following two years of pandemic disruption
Melbourne — 10 March, 2022 —Xero, the global small business platform, today released a new report revealing that despite pandemic disruption, almost 60 percent of accountants and bookkeepers surveyed expect to grow revenue this year, with 27 percent planning on hiring additional staff.
The Xero ‘State of the Industry’ report provides a unique snapshot into the current state of the accounting and bookkeeping industry and sentiment after almost two years of the COVID-19 pandemic. Based on a survey of over 500 advisors, the report looks at how they have responded to the disruption, current industry trends, and the outlook for 2022.
For advisors looking to grow, the report found opportunities are available for practices to expand and offer additional services as well as those targeting specific small business growth industries. These include construction, professional services, and health care.
The report suggests that talent recruitment will be the biggest hurdle for those looking to expand. Finding and recruiting new staff was reported as the number one most challenging HR priority for 39 percent of advisors and in the top three for over half (54%) of the respondents.
Joseph Lyons, Managing Director Australia and Asia, Xero, said: “Despite persistent challenges over the past two years, the accounting and bookkeeping sector is poised for growth in 2022. Heightened demand for industries like construction and professional services are leading to a boom in small business creation, generating even more demand for skilled advice.”
The report also shows how advisors, alongside their clients, turned to technology to adapt, with 94 percent of respondents revealing that adopting digital tools has had a positive impact. The top benefits include time savings, increased efficiency and improved clients relationships.
Professionals reported that COVID-19 had been a catalyst for small businesses to consider how they use digital solutions, with 49 percent of respondents saying they have seen a change in clients’ attitudes towards technology adoption. As a result, advisors are trusted to help small businesses implement new tools and improve workflows.
“Alongside their clients, accountants and bookkeepers have explored the limits of flexible working enabled by tech, which has seen many practices expand into different regions,” said Lyons.
“Over the next decade, bookkeepers and accountants will continue to play a critical role in Australia’s journey through the pandemic and beyond, providing services from advisory services to compliance and digitalisation.”
Key findings of Xero’s State of the Industry report include:
- Over 90% of advisors surveyed reported at least one positive impact from the pandemic. This included embracing new ways of working, offering new services, and changing client attitudes to technological adoption.
- 76% of respondents feel confident they have taken the right measures to protect their practice and clients against the ongoing financial impacts of COVID-19.
- More than three in five (63%) advisors surveyed influence the software decisions of their clients. These advisors were found to have 40% more small business clients.
- The typical advisor is likely to play the dual role of business owner and small business advisor, with 65% of respondents owning their own business and 18% being at a director or partner level.
- The survey found that women are more likely to own their own practice (68%) than men (57%), as are those who classify as Gen X or Baby Boomers.
- Traditional accounting and bookkeeping service offerings still dominate, with bookkeeping, compliance, and payroll being the most common. But other services are also popular, with advisory services offered by over half (59%) of the respondents.
- The accounting practices surveyed, on average, provide services to 183 small businesses and employ around 25 people. The average bookkeeping practice services around 64 small businesses and employs just over employees.
Media Contacts Xero Australia | Jessica Brophy | +61 431 268 549 | email@example.com
Xero is a cloud-based accounting software platform for small businesses with over 3 million subscribers globally. Through Xero, small business owners and their advisors have access to real-time financial data any time, anywhere and on any device. Xero offers an ecosystem of over 1,000 third-party apps and 300 plus connections to banks and other financial partners. For three consecutive years (2020-2022), Xero has been included in the Bloomberg Gender-Equality Index. In 2021, Xero was included in the Dow Jones Sustainability Index (DJSI), powered by the S&P Global Corporate Sustainability Assessment and in 2020, Xero was recognised by IDC MarketScape as a leader in its worldwide SaaS and cloud-enabled small business finance and accounting applications vendor assessment.
About Xero’s State of the Industry report
The report was commissioned by Xero Australia and undertaken by Lonergan Research to examine the Australian accounting and bookkeeping industry and provide insights to help advisors identify growth opportunities to succeed in 2022 and beyond. From November to December 2021, Lonergan Research conducted an online quantitative survey, interviewing 504 advisors. For this report, advisors are defined as Australian tax or BAS agents.
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