Shift to Advisory Services and Technology Adoption Drives 80% Optimism Among Canadian Accounting Practices

Toronto, ON - September 25, 2025 - Xero, the global small business platform, today released its 2025 State of the Industry Report, which reveals optimism and revenue growth across Canada's accounting and bookkeeping (AB) industry, driven by a strategic shift to advisory services and the adoption of new technology.

The report reveals a Canadian industry that is both resilient and progressive. An overwhelming 80% of Canadian ABs reported feeling optimistic about the future of their practices off the back of a strong year of growth:

• 75% reported increased revenue
• 76% saw an increase in profits
• 57% expanded their client lists

Cloud adoption and AI drive the future of the industry

Technology continues to underpin growth across the industry, allowing firms to increase in both efficiency and quality, yet there remains a significant gap between adoption and application. While 86% of Canadian practices used cloud accounting software in 2025, it was applied in only 59% of client engagements.

This gap, however, does not reflect a lack of technological appetite. In a striking contrast, the industry has enthusiastically embraced the potential of AI. The vast majority of Canadian accountants and bookkeepers (84%) feel prepared to start incorporating AI into their practices, and 90% are optimistic about the impact the technology will have on their business, with about a third (31%) seeing it as the biggest opportunity for the industry in the next 1-2 years.

“The data is clear: the Canadian accounting industry has its eyes firmly on the future,” said Andrew Kanzer, Managing Director of North America for Xero. “We’re seeing a pivotal shift where professionals see past immediate task efficiencies and envision a future where technology amplifies their expertise for their clients. This readiness for AI is a game-changer, and our commitment is to deliver the powerful, practical tools that will help them unlock new levels of growth and strategic value.”

Advisory services and expanded service offerings drive growth

Across all practice sizes, the addition of new services was a primary driver of both profit and revenue growth over the last year. Advisory services also emerged as a priority service offering, with the Canadian practices of all sizes offering advisory services at nearly the same rate as bookkeeping services (87%), which pulled ahead of tax services (72%) as the two most common services offered by Canadian practices.

“Advisory is no longer an add-on, it's what clients demand to navigate their future,” said Sophie Dillon, CPA, Co-founder of Orbit Accountants. “For us, technology is the engine for that advice, allowing us to provide real-time dashboards that help clients improve budgeting and cash flow planning. We’ve seen firsthand how this strategic oversight helps businesses thrive—one of our nonprofit clients used these insights to reallocate funds so effectively their surplus grew by 20% in a single year.”

Firms are increasingly bundling their services, with 72% of practices having started offering value-based pricing and advisory services in the same time frame. This pairing proves to be a winning strategy, as 90% of respondents agreed that value-based pricing made their practices more profitable.

Explore the full insights and data by reading the full Xero State of the Industry Report here.

ENDS

Media Contact

Xero Canada | Rola Tfaili | rola.tfaili@xero.com

Survey Methodology

From March 25th to April 4th 2025, Quadrant Strategies, commissioned by Xero, surveyed 250 accountants and bookkeepers working in practices across Canada. Respondents were found via independent panels and data has been weighted by practice size - more details can be found in the methodology section of the report.

About Xero

Xero is a global small business platform that helps customers supercharge their business by bringing together the most important small business tools, including accounting, payroll and payments — on one platform. Xero’s powerful platform helps customers automate routine tasks, get timely insights, and connects them with their data, their apps, and their accountant or bookkeeper so they can focus on what really matters. Trusted by millions of small businesses and accountants and bookkeepers globally, Xero makes life better for people in small business, their advisors, and communities around the world. For further information, please visit xero.com.