CPAs work long and hard to reach and maintain the level of knowledge required to tackle complex problems. Why, then, would accounting firms regress to a more basic level of service when their purported goal is to establish themselves as strategic advisors? Does this new trend of providing transactional processing (bookkeeping) diminish the value — actual or perceived — of accounting professionals? Or does it increase the value?

Times of Change

The accounting industry has seen a dramatic shift over the past decade as the roles of CPAs and finance professionals shift from those of facilitators and reporters of financial information to strategic experts who provide critical advice to the clients and companies they serve.

On the surface, becoming bookkeepers for small- and mid-size businesses (SMB) presents itself as a degradation of accounting services. Bookkeeping activities are intrinsically simpler than cash flow management, tax preparation, or business planning and forecasting.

A closer look reveals two main reasons for the shift back to providing bookkeeping services to the SMB market: the growing importance of CPAs’ involvement in software decision analysis along with their expertise on economies of scale.

The Cloud

In the United States, QuickBooks has been the gold standard for SMB accounting software. In the UK, Australia and New Zealand, however, the cloud-based company, Xero, dominates. The availability of tax software for individuals and businesses has reduced the demand for tax preparation services and created a revenue gap at most accounting firms.

Access to cloud services and increased competition for the small and mid-market business sector help explain the glut of software products in the accounting industry. A number of products, including QuickBooks and Xero, are helping businesses simplify their finances while allowing accounting firms to view their books. This firsthand view of SMB transaction processing and the financial status of businesses is providing accounting companies with insight into the needs of the SMB, thereby enabling them to offer SMBs a valuable service.

Ancillary Applications

While general SMB accounting software is helpful by itself, its value is greatly enhanced in combination with the many cloud-based software solutions available.

Applications that help automate the bookkeeping process include receipt scanning and management, document storage, and travel and expense monitoring tools.


The plethora of choices available to the SMB owner can be a source of confusion. Accounting firms and independent bookkeeping companies are helping their clients cut through the clutter by providing end-to-end solutions that enable clients to take advantage of the reduced overhead in economies of scale and consolidation of activities. The net effect: clients find relief from administrative tasks and accounting firms recover their revenue numbers.

The Bookkeeping Business

Business owners are often more than happy to turn over bookkeeping tasks to their financial advisors. Relegating the bookkeeping to experts enables them to focus on core business deliverables. Accounting firms are discovering that assuming the bookkeeping function gives them additional touchpoints, which aids client retention.

Making Sense

Automating bookkeeping transactions, consolidating overhead for SMBs and maintaining an ongoing — instead of once-yearly — service relationship, is benefiting both SMBs and their accounting firms. SMBs benefit from overhead cost savings and access to better monitoring tools. Accounting firms benefit from the additional revenue stream that bookkeeping provides. It’s a win-win.

Learn more about Texas A&M University-Corpus Christi’s Online Master of Business Administration with a Concentration in Accounting.


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