Overcoming talent shortages in accountancy with digital transformation

Singapore’s accountancy sector is facing a number of challenges. The demand for accounting services is growing, yet there seems to be a lack of accountants around to meet this growing demand.

Talent retention is also another challenge. With the increased demand for flexible work environments, better salaries and more, employees are choosing to leave the accountancy sector in search of greener pastures.

Deputy Prime Minister Lawrence Wong previously shared that over the past 5 years, the number of accounting degree students at universities here have dropped by more than 10%. The number of graduates who go on to become accountants or auditors have also fallen, further compounding the problem. Why is this so?

One of the biggest contributing factors could be starting salaries not being attractive enough. The starting salaries for accountancy graduates joining accounting firms today range from S$3,200 to S$3,800 — below the median starting salary of $4,200 for a university graduate. Given the shrinking talent pool, the Big Four firms are also outbidding small and medium-sized practices (SMPs) for accountancy graduates.

Another reason could be the perception young people have about the profession. They assume that accounting work is boring, monotonous and repetitive. Given all these issues, how can firms tackle the challenge of talent scarcity? The answer is digital transformation — and we’ll delve deeper into it in this blog.

How has digital transformation revolutionised traditional accounting processes?

Digital transformation refers to the integration of digital technologies into all aspects of business operations, fundamentally changing how businesses operate and deliver value to customers. In the context of accountancy, this involves leveraging technologies such as cloud computing, artificial intelligence (AI), automation, and data analytics to streamline processes and enhance decision-making.

Various industries have already been revolutionised by digital transformation — improving efficiency, reducing costs, and enabling innovative business models. In finance and accounting, traditional methods are being replaced by more advanced and automated systems that not only increase accuracy, but also provide real-time insights.

By empowering accountants with advanced data analytics tools, it facilitates data-driven decision-making, allowing for more accurate financial forecasting and strategic planning. Accountants can harness the power of big data to gain valuable insights and provide proactive financial advice to clients.

Digital transformation also helps to improve security measures and ensures compliance with evolving regulations. Blockchain technology, for instance, can be employed to secure financial transactions, reducing the risk of fraud. This enhanced security not only protects sensitive financial data, but also strengthens the overall trust in the profession.

Client expectations are also ever-evolving, and digital transformation enables accountants to enhance the client experience. Through online portals, real-time reporting, automated communication and more, accountants can provide more transparent and efficient services, thereby attracting and retaining clients.

Digital transformation in accountancy represents a paradigm shift that goes beyond mere technological adoption. It changes the way accountants work, collaborate, and deliver value. By embracing this transformation, Singapore’s accountancy sector has the potential to not only address talent shortages but also redefine traditional processes, ensuring a more dynamic and resilient profession.

How does digital transformation address current talent challenges?

By automating routine tasks, digital transformation mitigates the impact of talent shortages by reducing the dependency on a large number of specialised professionals for day-to-day operations. This is particularly advantageous in markets like Singapore, where there is a shortage of skilled accountants. The existing talent pool can be utilised more strategically, focusing on tasks that require human intelligence and creativity.

1. Leveraging AI and automation for efficiency

Digital transformation in the realm of accountancy involves the integration of advanced technologies such as artificial intelligence (AI) and automation tools. These technologies can handle repetitive and time-consuming tasks with a level of speed and accuracy that surpasses traditional manual methods.

By automating routine and time-consuming processes like data entry, reconciliation, and basic analysis, accountants can redirect their efforts towards more strategic and complex tasks that require human judgment and expertise. This not only increases productivity, but also makes the profession more attractive to individuals seeking intellectually-challenging roles.

Digital tools can also significantly streamline the workflow within an accounting department. Automated processes ensure that tasks move seamlessly from one stage to the next, reducing bottlenecks and minimising the risk of errors. This not only optimises time and resources, but also ensures that the entire accounting process becomes more transparent and traceable.

2. Scalability and resource allocation

With digital transformation, it allows businesses to scale their operations more efficiently without proportionately increasing the workforce. AI and automation enable accountancy firms to handle a larger volume of data and transactions without the need for a linear increase in manpower. This scalability is particularly beneficial in a talent-short market like Singapore, where finding and retaining skilled accountants can be challenging.

3. Expanding the talent pool

Accountancy firms often face limitations in recruiting talent due to geographical constraints. However, digital collaboration tools help to break down these barriers by enabling virtual teams. Cloud-based accounting software, collaborative document-sharing platforms, and virtual communication tools allow accountants to work seamlessly from different locations. This not only enhances flexibility, but also enables organisations to tap into a broader talent pool beyond their immediate physical vicinity.

Accountancy also often requires specialised skills in areas such as tax regulations, audit methodologies, and industry-specific financial reporting. With virtual collaboration, organisations can bring in experts from diverse locations who possess the specific knowledge needed for certain projects. This access to specialised skills enhances the overall competency of the team and allows for a more comprehensive service offering.

Having a diversified workforce with individuals that have different perspectives, experiences, and cultural backgrounds can also be particularly beneficial for addressing complex financial challenges. Differing viewpoints can lead to innovative approaches in areas such as risk management, compliance, and financial strategy. The combination of various skills and perspectives contributes to a more creative and adaptive problem-solving process.

4. Continuous learning and adaptation

Digital transformation encourages a culture of continuous learning and adaptation, because it necessitates the development of new skillsets. Accountants need to stay updated on the latest technologies and trends in the industry. This ongoing learning process ensures that the workforce remains relevant and equipped to handle new challenges, contributing to their professional development and the overall resilience of the industry in the face of talent shortages.

Here are some strategies to promote continuous learning and ensure that accountants stay abreast of the latest technological developments:

• Training programs and workshops: Implement regular sessions focused on emerging technologies relevant to the accounting profession. Offer hands-on sessions that allow accountants to interact directly with new tools and software.
• Online learning platforms: Provide access to online courses on accounting technology, data analytics, artificial intelligence, and other relevant subjects. Platforms like Coursera, LinkedIn Learning, and Udemy offer a wide range of courses.

• Mentorship programs: Connect experienced accountants with their peers or juniors so they can guide them in adopting new technologies. This creates a supportive learning environment and encourages knowledge sharing within the organisation.
• Professional certifications: Encourage accountants to pursue professional certifications related to accounting technology and data analytics, which can enhance their skills and credibility.

• Cross-functional collaboration: Facilitate collaboration between accountants and professionals from other departments, such as IT and data science. They can work together on projects, fostering a culture of mutual learning and knowledge exchange.

• Tech talks and webinars: Organise regular tech talks and webinars featuring industry experts, thought leaders, or technology providers. These sessions can cover topics ranging from the impact of blockchain on accounting to the latest updates in accounting software.

• Internal knowledge sharing channels: Create internal platforms where accountants can share articles, tutorials, and insights about new technologies. Encourage open discussions to facilitate collaborative learning.

• Communication and recognition: Regularly emphasise the importance of staying updated on technological advancements. Highlight success stories of individuals or teams that have successfully implemented new technologies to achieve better results.

5. Attracting and retaining talent with tech-savvy practices

Implementing cloud-based accounting software and collaboration tools to modernise your work processes not only enhances efficiency, but also signals to potential talent that your organisation values innovation and stays at the forefront of technological advancements. These free up time for accountants to focus on higher-value, strategic activities, contributing to a more fulfilling and engaging work experience, and will also shape your employer branding.

Candidates will be more inclined to join your organisation when they can see that it is committed to continuous learning, and provides opportunities for them to develop further skills in emerging areas such as data analytics and artificial intelligence. Digital tools that enable flexible work arrangements, including remote work options, also demonstrate how your organisation values work-life balance and understands the importance of flexibility. These are all compelling reasons for candidates seeking a progressive work environment.

You could also implement a recognition and rewards program that acknowledges employees who contribute to innovation. This could include recognising successful technology implementations, process improvements, or creative problem-solving. Recognising and rewarding innovation fosters a positive and motivating work environment.

Clearly communicate the organisation’s vision for the future, emphasising how digital transformation is integral to achieving strategic goals. When potential hires see a clear and exciting vision for the organisation, it enhances the attractiveness of the workplace and its commitment to staying at the forefront of industry trends.

Embrace change for a brighter future

In essence, digital transformation brings about a whole host of opportunities for businesses to tap on. The benefits are aplenty, you only need to take that first step to future-proof your business.

With Singapore having an acute talent shortage in the accounting industry, that’s even more reason to embrace digital transformation. Join our Partner Network as a referral partner to introduce Employment Hero to your clients. We’re an all-in-one, cloud-based HR and payroll software that provides businesses with a cost-effective, accurate, and streamlined solution. The platform is constantly upgraded with AI enhancements, so you can leave all the tech work to us while you reap the benefits.

If you’re an accountant, bookkeeper, business services firm, consultant or serve SMEs in industries like financial services, utilities or telecommunications, get in touch with us. You’ll get rewarded when you refer your clients through to us — all while growing your business and strengthening your client relationships. It’s a win-win.