Trend 1: Increased reliance on digital and cloud-based systems

With HMRC’s continued drive for Making Tax Digital (MTD), many businesses have already made the jump to digital submissions.

But for the next tranche, especially those with accounting software, the transition is unsettling; accountants have a great role to play in supporting clients through this change.

Along with digital tax submissions, using a cloud-based accountancy system enables businesses and their accountants to access real-time financial data from anywhere, at any time.

This brings multiple benefits, such as:

• Being able to make business decisions faster because of the access to accurate, up-to-the-minute data and insights
• Helping improve collaboration between accountancy firms and clients
• Helping to make many manual processes, like data entry, quicker and more efficient.

With benefits like these, it’s no wonder that continued digitalisation of accountancy is likely to grow throughout 2025.

Trend 2: AI and automation play a greater role

It doesn’t feel too long ago that AI was just a concept rather than a tangible ‘thing’, but it’s true to say that the AI revolution is now really starting to transform accountancy.

Some ways that AI and automation are already having an impact on accountancy include:

Automating reconciliations – with some cloud accountancy platforms able to match transactions automatically to save users time when logging them, while also reducing the chances of errors compared to inputting the data manually.

Spotting errors or potential fraud – with AI algorithms able to spot unusual activity or changes to patterns in financial data, which could signify an error or even fraud.

Spotting useful insights – with AI dashboards able to instantly visualise and summarise data, giving accountants and their clients a quick snapshot of important metrics such as cash flow and profitability.

Trend 3: Expansion of accountancy’s role in business

The traditional role of accountants being limited to purely providing data and handling tax returns is well and truly over. Clients are increasingly seeking strategic business advice from their accountants, whether that’s in relation to digital transformation, business recovery, growth plans or other aspects. This gives accountancy firms great revenue growth potential, by expanding their service proposition, but also presents challenges in managing capacity and in recruiting and retaining the best talent to deliver these value-added services.

The current challenges

How to bridge the accountancy talent gap

Anyone working in an accountancy firm will know that recruiting and retaining experienced, high-quality accountants has become more and more difficult in recent years. We’re predicting this continuing throughout 2025 and beyond. Our Accounting Talent Index shows that almost half of accountancy firms (45%) are affected by skills shortages.

Cybersecurity threats continue to grow

With more sensitive financial data now being stored and managed in the cloud, cybersecurity is a significant concern for many accountancy firms. If client data is compromised and ends up in the wrong hands, this can cause some major problems for the business in question, as well as breaking trust, damaging the accountant’s reputation and potentially having legal consequences too.

How Advancetrack can help your practice

With many current trends, opportunities and challenges for accountancy firms, the growth limitations or blockers that you will come up against can be overcome through the effective outsourcing of some of your client’s accounting functions to a trusted partner.

You get all of the benefits of additional staff members to expand your team, but not the overheads. You can also scale outsourced accounting when needed, so seasonal fluctuations and other changes in demand can be accommodated easily.

Outsourcing: how to choose a provider

Choosing the right outsourcing partner is a critical decision for your accounting firm. Taking the time to work out where outsourcing will fit into your firm is the first step.

Find ‘an extension of your team’

Once you’ve mapped out your plan, the next move is to find a company who will act as an extension of your team and help propel your firm into the future. You need to partner with a team that will prioritise your firm’s goals and work with you to learn your processes so they become an essential part of your ethos. Patience is key.

Make IT security a priority

Making sure your team has ISO certification security protocols will allow you to work alongside your outsourcing partner with confidence that your client’s data is safe. The partner needs to demonstrate a strong commitment to the highest security standards.

Understanding accountants

Having a deep understanding of the accounting industry is paramount when choosing your outsourcing team.

Establishing trust

So how do you trust your outsourcing team? You should be able to access testimonials from existing clients, research which industry affiliations they have, and make sure they are committed to ethical practices.

Access to talent and resource

Have you struggled to recruit talented and driven accountants who are both local and within your budget? When you choose the correct outsourcing company, you gain access to a large pool of committed and skilled accountants ready to hit the ground running. This allows your firm to scale swiftly, meet client demands effectively, and uphold superior service standards.

Transition plan

But how will I be able to seamlessly integrate an outsourced team into my work processes? Transitioning to outsourcing should be as smooth as possible; looks at those that can explain the likely changes ahead, and wanting to create a seamless partnership.

A long-term partner

An outsourcing team should display commitment to your firm means you can feel secure with your choice. They should be willing to understand your practices, evolve with you and your team over time, and continually look to meet and exceed your needs.

Time to scale

Although it may seem daunting to engage an outsourcing company to extend your team, elevate your firm’s recruitment, and commit to a long-term partnership - it can also become a vital part of the scalability of your services.