There is no denying the grave situation in the US business scene, marred by an unprecedented accountant shortage.  The number of accounting professionals and CPAs is on a decline over the last few years. This has made things quite tough for businesses and organizations in the country.

You will understand the seriousness of the situation when you will be analyzing the latest data. As per the AICPA data, the number of qualified US accounting graduates has reduced by as much as 20% since 2010. Nearly 1 million jobs in the USA are now being affected by a shortage of accountants. In fact, leading accounting firms like PwC, EY and Deloitte have admitted a talent shortage in this niche.

Understanding the root causes behind the accountant shortage

As it is, the unprecedented Shortage of Accountants in U.S. Firms has been triggered by several factors. These are:

• The rise in the number of accountants taking retirements was heightened by the pandemic.
• A rise in the complexity of financial norms is making accounting professionals rethink career options.
• A common perception about the prospects of accounting being an unglamorous, boring career.
• A section of accountants making a career shift, switching to technology domains.
• The educational journey to become a certified accountant is a long one and that is acting as a deterrent for many aspirants.
• The lack of growth prospects has demotivated many budding accountants.
• Experts blame the number of working hours and hardships in balancing career and personal life as major causes behind accountant exodus in the USA.
  

The impact of a shortage of accountants on businesses

The huge accountant shortage is likely to have a deep impact on various businesses operating in the USA and abroad, say the experts. The likely outcome of this development may include:

• Businesses facing hardships in filing tax returns and recording financial transactions with accuracy.
• A heightened risk of financial errors and frauds, leading to serious consequences.
• Hardship in attracting investments from external entities.
• Difficulty in making investment decisions and financial planning.
• A shortage in the number of accountants is making it tedious for the US accounting firms to accommodate new clients.
• Several accounting firms in the USA are coping with piling backlogs and they also have to face sluggish turnaround time owing to the ongoing accountant exodus.

How businesses impacted by accountant shortage can recover?

While the ongoing CPA shortage in the USA has impacted many ventures adversely so, it is possible for them to salvage the situation. Then, businesses impacted from this development can take up some remedial measures to bounce back.

• Resorting to advanced technology

A section of US companies are switching to advanced software and cloud services to resolve the accountant shortage-induced hassles. So, they are using payroll software applications with automation and useful features to automate and execute accounting operations without hurdles. However advanced applications to handle regular accounting, sales tax and income tax are also being embraced.

• Offering flexibility to employees to reduce accountant shortage

Some US employers are giving more flexibility to their accounting professionals. So, they are offering hybrid and remote work options to ensure employees get more flexibility to continue working. Once again, they are embracing advanced accounting software for this.

• A hike in payment and amenities

Businesses are resorting to paying hikes for the accounting professionals to slow down an exodus and additionally they are also offering them more employee facilities to make the job more enticing.

• Resorting to outsourcing entities

Of late, several US-based ventures have started signing up for the services of offshore accounting outsourcing companies, including those in the Asia pacific region. This is a handy option and choosing this path eliminates many hurdles associated with hiring fresh accounting professionals or deploying changes in the workflow.

Why hiring accounting outsourcing companies can be great for US ventures?

On finer analysis, it is not hard to fathom why signing up with offshore accounting outsourcing service providers is feasible for the majority of US businesses affected by the accountant shortage. By hiring these outsourcing entities, they gain in so many ways.

• Cost reduction

By hiring offshore accounting outsourcing firms, US businesses can reduce operational costs significantly. Then, just consider how much a venture would spend after a dedicated accounting team, including veteran CPAs. When you hire an offshore accounting outsourcing firm, you just pay the charges.

• Accuracy in workflow-

Offshore accounting outsourcing entities have skilled accounting professionals in their teams. They are capable of meeting the stringent accounting and taxation analysis needs of their clients. So, when you hire these outsourcing entities, there will be no errors in financial analysis and taxation etc.

• Access to talent pool to reduce accountant shortage

Remote accounting outsourcing firms serve as huge talent pools. These entities have talented and veteran accountants in their teams and so US accounting firms can be assured about their operations being handled in the best way, regardless of complexity involved in report preparation, financial analysis etc.

• Flexibility and scalability-

Offshore accounting outsourcing firms are capable of scaling up and down services to match client company needs. So, they are flexible enough to work for small-sized and large sized clients with equal dexterity. 

• Dedicated staff and team to reduce accountant shortage-

These accounting outsourcing firms have their teams and staff located offshore. Then, they are fully professional and capable of catering to varying client accounting operation needs yearlong.

Summing it up

Hiring an offshore accounting outsourcing firm can be useful for US firms, helping them overcome the accountant shortage crisis. However, assessing the outsourcing partner on key grounds like clientele, expertise, and service terms is necessary.