How Global CPA Firms Can Combat “The Great Resignation”: Maanoj Shah

Recently I went for a global CFO meet where I got the opportunity to interact with CFOs across the globe. Every person I spoke to said, staff retention is the biggest challenge they are facing right now. This got me thinking that “The Great Resignation” tidal wave is hitting everyone hard, irrespective of the industry sector. This mass exodus is being felt both inside and outside of the accounting sphere.

You could argue that employee turnover is normal and retirement is a natural part of life. But the data tells a different story. In November 2021 alone, 4.5 million Americans quit their jobs. According to the U.S. Bureau of Labor Statistics, in all 20.2 million employees have walked away during May – September 2021. And, over 73% of US employers are having difficulty retaining and attracting new staff. That is a serious issue!

With a large percentage of accountants retiring, it is creating a great void in the industry. Besides, the cumulative cost to businesses facing The Great Resignation is huge. But why is this happening? And can anything be done about it? Here’s my take!

Key Issues

Owing to the growing regulatory requirements and stringent compliances, there is increased pressure on the accounting staff more than ever. Accountants all over the globe are struggling with overwork and burnout in the busy tax and audit season. Moreover, during the pandemic, people got access to alternative jobs with the “Remote Work” culture where they could balance personal and professional life. So your employees had a choice between being an overworked accountant vs remote worker where they were not bound to geographies and could work for companies in any part of the world. These alternatives created a great challenge for CPA and accounting firms.

The Solutions

1. Create Hybrid Work Format: As an accounting firm, a lot of collaboration is required between a Bookkeeper, an Accountant and a Partner. However, it might not be possible for them to physically meet every time. So ideally if CPA firms can create a hybrid work format, say for example 3 days in office and 2 days WFH, it can help accountants to balance professional and personal life and they will get the needed time and space. And remember, a happy employee equals a productive and motivated employee.

2. Implement Collaborative Tools and Technology: Adequate technology and automation tools in the accounting field can help deal with great resignation. It’s time that you understand the need to automate your accounting function and embrace advanced technologies like Artificial Intelligence, Robotics, Cloud Computing, Big Data, Internet of Things, Blockchain, etc. Use the latest tools and technologies like Zoom, Google Meet, etc. for meetings. Make use of Accounting Practice Management Softwares like Karbon, Financial Cents for managing client deadlines and work. Use Project Management Tools like Monday.com, Asana to keep client work and priorities organised.

3. Switch to Outsourcing: You can outsource accounting and bookkeeping services to a third party and get experienced and expert professionals looking after your accounting and finance function. Cross border or offshore outsourcing to a country like India can add significant value to small and medium businesses in the form of reduced costs, time zone advantage, access to specialized expertise and more.

You can easily scale up their services in the busy season and free your in-house staff for more productive tasks. This will not only bring more satisfaction to your employees but will also keep them motivated. An outsourced partner can help you streamline your processes and workflows to achieve greater efficiency. Additionally, they can assist you to smoothly automate or transform your finance function in order to achieve maximum value. One can refer to our blog that was written earlier on technology transformation . https://finsmart.co.in/technology-transformation-for-your-accounting-process-finsmart/

4. Seasonal Incentives: Tax season can be really exhausting for accountants. They are naturally overworked, and hence during such times, burnout rates can be high. You may ease their stress and keep them happy during tax season by incentivising them over and above their compensation package. Everyone loves a bonus system that rewards their performance. Consider offering employees a one-time bonus, special incentives, gift cards, extra allowances like offering food-based rewards in the form of pizza coupons, happy hours, etc. Rewards can be individual, team-based, or be a joint effort to meet an office-wide goal. This added benefit will help them remain motivated during this tough season and build loyalty towards their company.

Act Fast, Act Now!

We don’t know how the great resignation will impact us but being prepared is the key to surviving it. So take action now! There can’t be any perfect solution to The Great Resignation but some of the above solutions can help CPA and Accounting Firms to combat the situation. Employee Retention is a constant process and one has to invest in terms of time and energy in creating a great working relationship and culture of trust and bonding within the teams.

About Author

The article is written by Maanoj Shah – Director Growth Strategy & Alliances at Electronica Finsmart Solutions Pvt. Ltd. www.finsmart.co.in Finsmart is a leader in accounting outsourcing with 15+ years of experience in catering 150+ clients in outsourcing of payroll, bookkeeping and management accounting services for large multinational corporations as well as SMEs globally. The Accounting Seat™ offering by Finsmart is specially designed for global CPA firms. It offers bookkeepers on subscription helping CPA firms to reduce their workload, help them to provide scalability with bookkeepers and enhance efficiency and profitability of the firm.

Ministry of Corporate Affairs ( MCA ) has now allowed all matters of board to be approved through Virtual Meeting wef 15th June 2021 – Finsmart

With this amendment some board matters which were restricted to pass through physical board meeting only, can now be dealt with in a Virtual Board Meeting

However one should keep following points in mind while conducting Virtual Board Meeting:

  • Virtual Board Meeting can be held anytime with 7 days’ notice given to every director either through electronic means or by post or hand delivered
  • It is necessary that all participants to Virtual Board Meeting have access to same technology that enables them to participate in the meeting without any constraints
  • It is necessary that virtual board meeting is recorded the audio with video and the recording is saved for records
  • It is necessary that only concerned directors are attending the meeting and no other person is allowed to attend the same in any manner
  • It is necessary to ensure that proper identification procedures for persons attending the meeting and security measures for safeguarding integrity of the meeting are undertaken

Virtual Board meetings has upside such as reduced travel, more attendance, shorter agendas and quick presentation.

Recent amendment is a good move bringing ease of business conduct for all companies on the background of Covid pandemic.

Though social distancing measures are going to relax at some point in future, we feel that most of the companies will continue to adapt the series of online board meetings throughout the year for its obvious benefits

7 Easy Steps of Crisis Management Planning in 2020

One of the most important roles that an accounts management team plays is managing crises.

First, let us understand what crisis management is?

Crisis Management is the process that involves the identification of threats to an organization and the methods used by the organization to deal with such threats.

Most of the businesses fail due to a cash shortage. The money invested and expended is more than what’s the working capital.

So, how do you start with crisis management planning? As well as what can be done if such an event occurs?

Let us explore the various options available to deal with any type of crisis management.

1. Start job costing

Start noting down the cost that each leg of the company brings up; marketing, payrolls, asset costs, products, and other services.

Put these costs against profit margins, and you will see the deficit. You will get a clear picture to work with.

You will see the profitable services differentiated from the non-profitable ones.

2. Expedite your receivables process

Determine the accounts that can be pushed to pay early. You need to be very careful about which accounts you are asking for early receivables.

Tap into the most promising accounts first, and while establishing new partnerships, ask for early part payment.

3. Look at possible borrowing options

You can be considering credit options and borrowing from legit financial organizations.

Be mindful enough to understand the interest rates and other things that can affect and hamper your business.

Before you take business loans, know that if your company has a cash flow problem at the primary level, the loan works only as a temporary relief.    

4. Negotiate on your payables

Negotiating on your payables with your vendors can be a significant relief on your working capital. Be honest with your vendors about your paying capacity.

If you can push for part-payments, or a complete waive of even a penny, nothing like it. Remember to never negotiate to a point where you will be heavily indebted.

That would be the last thing you need during a crisis.

5. Eliminate expenses

When in a cash flow crisis, prioritize your company’s expenses.

Eliminate every cost and pay only the cost that keeps your business operational and keeps you running.

Keeping an eye on every penny that you spend is an excellent filter to sort out expenses, but more importantly, doing so during a crisis is helpful.

6. Manage non-essential assets

Remember that any asset that’s not required at present, or during a crisis, is a liability.

Sort your assets out and check for any asset that’s adding more cost than revenue. You could always do an audit of every asset that keeps your company moving.

Removing or selling off any asset that doesn’t help only relieve your business account.  

7. Hire an outsourcing agency

One of the ways to be prepared is to hire an outsourcing accounts management team. A dedicated team that looks over your account books and balance sheets has preventive measures set up and has a plan B for a crisis.

An accounts management outsourcing team keeps track of your company’s financial records, forecasts cash flow shortages and raises, and keeps on hand methods and steps to take during a crisis.

The accounting outsourcing companies come with an added advantage of cost flexibility against the fixed cost of in-house resources.

To summarise

Always keep a check on your company’s accounts management and always have a backup plan ready. 

Keep your borrowing options open and immediately start job costing once you detect a cash shortage. Cutting down on expenses, trying to early receivables can all help in keeping your business running?

As a rule, always have a backup plan ready, or have a dedicated accounts management outsourcing firm do the job.