Xero, the global small business platform, has unveiled a transformative shift within Singapore’s accounting and bookkeeping sector, as per its latest report. This revelation showcases a substantial evolution driven by technological advancements and the changing expectations of clients.
The ‘State of the Industry‘ report, which surveyed 300 accountants and bookkeepers in Singaporean practices, sheds light on various factors reshaping the industry’s future. Economic pressures, a shortage of skills, the emergence of technologies like artificial intelligence (AI), and the evolving needs of small businesses are among the primary influencers identified in the report.
A staggering three-quarters of the respondents acknowledged the necessity to provide increased advisory services to align with both client demands and industry trends. Consequently, 95% of the surveyed practices now offer at least one advisory service, with 44% of these firms implementing this change within the past year alone.
To manage this transition effectively, practices are leveraging digitalization as a pivotal tool. A significant 72% of respondents anticipate that AI will streamline their workload within the next five years, enabling them to focus more on advisory services by automating routine tasks. Moreover, one-third of these practices are outsourcing work offshore, with over half emphasizing that this move aims to facilitate their local teams in prioritizing advisory roles.
Koren Wines, Managing Director of Xero Asia, emphasized the evolving role of accountants and bookkeepers, stating, “Increasingly, accountants and bookkeepers are being recognized as true advisors, offering holistic support to help Asia’s small businesses manage the challenges of today and the future.”
The survey highlights the proactive steps taken by firms to counter the supply-demand gap, emphasizing the need for a revamped approach in addressing the skills shortage. Wines emphasized the importance of leveraging AI to empower advisors in undertaking more strategic work, urging collaboration between the education system and industry professionals to inspire the next generation of advisory professionals.
Adaptability Fuels Resilience
Amidst Singapore’s sluggish GDP growth, 80% of firms anticipate the economic environment’s impact in the coming 12 months, with only 11% expecting a significant effect. To mitigate potential challenges, practices are implementing measures such as fee increases (57%) and alterations in service offerings (49%).
Despite economic uncertainties, the year has been prosperous for practices overall. With an average addition of 19 new clients, over two-thirds reported revenue increases (67%) and profit gains (68%).
Wines concluded, “Practices are excelling despite challenging circumstances, primarily by providing human-centered advisory services. These offerings, highly valued by businesses, foster trust and confidence, cementing advisors’ roles as pivotal to small business success.”
The report not only delineates the current landscape but also underscores the potential for transformation within Singapore’s accounting and bookkeeping sector, heralding a future shaped by technological innovation and adaptive strategies embraced by forward-thinking practices.
