By Richard Corn.
The demand for client advisory services (CAS) continues to grow each year as clients look for more insight into their financials and increasingly rely on their accountants to help make informed decisions. According to the 2024 CPA.com & AICPA PCPS CAS Benchmarking Survey, CAS practices have reported a median growth rate of 17%.
This indicates clients are increasingly looking beyond traditional accounting services and instead want strategic partners capable of providing real-time financial insights and proactive guidance, especially as businesses face an increasingly challenging economic landscape.
While accounting firms recognize this evolution in client needs, there is a disconnect between acknowledging technology’s importance and continually investing in it. Despite technology being an essential component for efficiently delivering enhanced advisory services, only 51% of CAS firms are committed to continuous investment in technology solutions. This gap between recognition and action shows a missed opportunity for firms hoping to capitalize on the growing demand for advisory services.
For accounting firms to effectively tap into and sustain this market growth, they must bridge this technology investment gap. The firms that commit to ongoing technology investment will be positioned to scale their advisory services by taking the heavy lift out of the day-to-day tasks, allowing employees to focus on the advisory services.
Firms that are continually innovating have a competitive edge — if you’re not evolving through technology, your firm can easily fall behind. We know technology is a driving force for CAS offerings — keep reading to learn why they give such a competitive edge.
Technology: The Engine Driving CAS Transformation
Technology isn’t just supporting the CAS transformation, it’s accelerating it. Technology can help streamline processes for accountants, freeing up time to devote to expanding CAS offerings and technology providers that incorporate AI into their offerings can help firms take these benefits even further. AI-powered systems are able to process documents, automate data entry, and detect errors quicker and with more precision, allowing firms to quantify time savings and optimize resource allocation across their practice.
As firms continue growing, technology can play a greater role in unlocking new services and/or enabling accountants to tackle new niches.
The accounting industry is still facing a talent crunch, but technology is here to help alleviate some of that burden. While the end goal is not to replace accountants, tech solutions allow firms to expand in ways that would be difficult to achieve with overly manual processes and fewer employees.
One example of this is Jitasa, a BILL accounting firm partner, that saw immediate changes after taking steps to modernize their tech stack. Because their AP process is now automated, it has freed up time for the firm to focus on developing their employees and develop a better staffing model — and also led to 20% gross margin gains in the AP process for the firm.
Just as CAS practices are constantly evolving, so are the technologies that support them as increased competition to traditional general ledger platforms drives additional innovation across products. When choosing a financial automation solution, be sure it is capable of staying up-to-date on new trends and emerging breakthroughs.
Firms that are well acquainted with and actively use technology are primed for growth, whether through outside investors or attracting new talent. Those that embrace technology report higher productivity, improved efficiency, and greater staff satisfaction. However, new solutions have been incorporated, firms should ensure they are continuing to stay up to date on new features and find opportunities to provide insight to their technology partners.
Building a Successful CAS Practice through Technology
Developing a successful CAS practice requires more than just offering new services, it demands a strategic approach to implementation and growth. Once technology is adopted, the job is not complete. Continual improvement ensures firms will stay on top of and even ahead of the trends. There are a few steps to take when adopting new technology and continuously improving it.
First, successful technology adoption begins with an evaluation of current systems and processes. Firms must conduct a needs analysis and resource assessment to identify the most impactful areas for technology investment.
Once the needs have been identified and a new solution is selected, firms need to create an implementation strategy. A well-defined implementation strategy should include clear selection criteria, realistic timelines, and comprehensive budget considerations — as well as plans for assessing and enhancing employee skills and capabilities to properly use new systems and solutions. This planning phase is crucial for ensuring successful technology adoption.
As the technology is being used, it is crucial to establish a process in the firm for feedback loops. Oftentimes staff are stuck with a slow process and they don’t have a clear way to share feedback across working teams or decision makers about the bottle neck.
Throughout the implementation process, accountants can rely on their tech partners for onboarding advice, best practices, and optimization. Peers are also great resources when going through the onboarding process.
Once the technology is implemented, this does not mean the focus on technology is over. There are constant advancements in technology for accountants, and the firm should stay up to date on what makes sense for their business. Just implementing one technology does not mean a firm is on the forefront of technological change.
Conclusion
Firms that embrace CAS practices have more growth potential, with CAS growth continuing to be a major trend in accounting firms that is outpacing the profession’s overall growth. The key to a steady growth rate and deeper client relationships is through well-thought-out planning, technology investment, and commitment to delivering high-value advisory services.
While most firms recognize the importance of bringing technology into their practice, it is not just a one-and-done deal. Those who embrace the continued technological transformation will be well-positioned to thrive in the evolving accounting landscape. A BILL survey of SMBs found that 79% would fire or stop referring their firm if it did not stay updated on the latest technologies.
By leveraging the power of advanced financial tools and taking on the advisory role, accounting first can create more value for their clients while building more profitable, sustainable businesses.
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Richard Corn, CPA, s Director of Product Management at BILL.
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Tags: Accounting, Advisory, CAS, Firm Management, Technology
