Against the backdrop of a changing business landscape, small and medium-sized practices (SMPs) are facing growing pressure from technology, competition and deregulation.
Their top concern is how their practices can evolve in the long term so that they continue to add value to their predominantly small and medium-sized enterprise (SME) clients.
We recently caught with Paul Tan, a Fellow member of ACCA and Managing Director of CA Trust PAC, an SMP. He shared his views on how SMPs can adapt to these changes in the business environment.
On rising audit thresholds and automation
With rising audit thresholds in certain parts of the world, automation and deregulation impacting the industry, Paul reckons that SMPs need to evolve their practice from one that focuses predominantly on compliance work such as statutory audit services and assistance in annual tax filings of individuals and companies to one that proactively solicits advisory and consultancy work.
Instead of waiting for their clients to automatically engage their compliance services due to statutory filing deadlines, he urges SMPs to be proactive and convince clients that engaging their advisory and consultancy services will be beneficial to them.
Paul also refers to a recent international survey of SMP business models that we conducted in partnership with six other accountancy bodies, including the Institute of Singapore Chartered Accountants (ISCA). The survey, ‘The Global SMP business model: understanding a changing profession’, provides a detailed map of the sector’s service offering, its growth prospects and the source and value of its diverse skills across different countries.
On the global trend of deregulation
He says that SMPs must realise that their traditional revenue streams from compliance work will diminish. He believes that SMPs that adapt their core compliance skills acquired in assurance and taxation and offer related value-added financial advisory services to their SME clients will be resilient to the deregulation trend and can even take advantage of first-mover benefits.
To read more on what Paul had to say, please click here.