Xero: Few New Zealand accounting and bookkeeping firms expect AI-driven job cuts

Wellington — 12 October 2026 — Xero, the global small business platform, today released its Modern Practice Playbook for Aotearoa New Zealand, which reveals AI is changing how accounting and bookkeeping practices work, but few expect the technology to reduce the size of their teams in the next year.

The research commissioned by Xero surveyed 526 senior accounting and bookkeeping professionals across New Zealand, and found 78% of practices have tried AI and half (49%) are now actively using it in day-to-day workflows. However, the majority (94%) of New Zealand practices don’t expect AI to reduce team numbers over the next 12 months.

Across all staff combined, the use of AI tools saves practices seven hours per week and an estimated $145,000 in monetary savings per year. Among top-performing firms*, these figures rise to 10 hours per week and $200,000 per year.

Firms are using this unlocked capacity to prioritise work requiring judgement and strong client relationships. Some 42% of accountants and 30% of bookkeepers say they’re redirecting AI-freed time into higher-value advisory work.

“There’s been a lot of focus on whether AI will replace accounting jobs. What this research shows is a different kind of change: technology is taking pressure out of routine work, while practices are putting more time into advice, relationships and growth,” said Bridget Snelling, Country Manager, Xero New Zealand.

“The opportunity for practice leaders is to be deliberate about where freed capacity goes. If the time simply disappears into the working week, the benefit is limited. If it’s redirected into higher-value work, training or new services, it can change the economics of the practice.”

The shift is also changing what firms look for in people. Around three in five practices (61%) say AI has already changed how they hire.

More than a third (35%) are prioritising soft skills and relationship management, while one in five (20%) are recruiting non-traditional roles such as data analysts and tax technologists.

“AI works best when it’s applied to a clearly understood process, not dropped into a practice and expected to improve everything,” said James Bergin, EGM of Technology Research and Advocacy at Xero.

“Among practices actively using AI every day, 89% say their core processes are well documented, compared with 30% of practices not using AI. This discipline makes it easier to identify the right use cases, build in review and control, and keep the professional judgement and accountability with the people.”

The Modern Practice Playbook looks beyond AI to the structural choices shaping modern practices, including firm design, service mix and pricing. The research also found:

• 59% of New Zealand practices offer advisory services and, among them, it is their top-earning service. For non-advisory firms, 27% cite lack of capacity as a barrier
• Practices bill an average of 66% of client engagements on non-hourly terms. Of practices using value-based pricing, 45% say it has made their practice more profitable
• Top-performing practices are 2.2 times more profitable than lower-margin employing practices, with the report showing stronger use of embedded AI, higher-value services and disciplined pricing among these firms

One New Zealand practice featured in the report is Oxygen Advisors, which has built advisory into the core of its business model.

Founded by Matt Dold, the firm operates as an outsourced finance function for high-growth technology companies, with 85% of its work delivered by CFO partners across areas including strategy, capital raising and financial decision-making.

“Technology is giving accounting firms the opportunity to spend less time on repetitive work and more time helping clients make better decisions,” says Dold.

“At Oxygen, advisory has always been at the centre of what we do, and the real value comes from helping clients understand the financial consequences of the choices in front of them.”

Oxygen Advisors uses Xero as the central platform for its accounting and finance work and has invested in automating repetitive internal processes to create more capacity for advisory work.

The firm has a formal process for identifying recurring tasks which take up team time, with automation projects assessed against client outcomes, team experience and financial impact.

Four technically-minded accountants now spend a portion of their time developing internal tools, including automation for accounts payable and consolidated client summaries, helping free up the wider team to focus on advisory.

“The Modern Practice Playbook is designed to be used, not filed away. It combines New Zealand data with practical guidance on how to redesign workflows, build advisory into the service mix and evolve pricing,” Snelling said.

“We’re launching it alongside Xero Roadshow so accountants and bookkeepers can take the findings straight into conversations about how they want their practice to work next.”

The New Zealand edition features Oxygen Advisors alongside two other leading practice case studies, as well as guidance from industry bodies and Xero experts.

The Modern Practice Playbook is available at: xero.com/nz/campaign/modernpracticeplaybook/.

Find out more on Xero Roadshow: xero.com/au/events/roadshow-new-zealand/.

ENDS

Media Contact

Xero New Zealand | Jess Brophy | +61 431 268 549 | jess.brophy@xero.com

Research methodology

The survey included 526 respondents in New Zealand, with 266 sourced through third-party panels and 260 from the Xero customer database. Data was weighted so each practice-size segment represented 25% of the sample. Top performers* are employing practices with two or more full-time employees and a net profit margin of 41% or above. AI time-saving figures are self-reported estimates calculated using the midpoint of banded survey responses.

About Xero

Xero is a global small business platform and a trusted financial operating system for the AI era. Xero’s purpose is to make life better for people in small business, their advisors, and communities around the world. By unifying core financial operations (including accounting, payroll and payments) underpinned by insights and a robust ecosystem into autonomous workflows, we empower 5 million small businesses and accountants and bookkeepers across 180+ countries to move from managing records to making informed decisions. For further information, please visit xero.com.