INSIDE Public Accounting offers three additional reports to complement our Practice Management Report. These specialized reports provide detailed insights into firm administration, human resources and information technology. This year, over 300 accounting firms contributed to each of these surveys. Below is a selection of some of the data collected.
Firm Administration
At 67% of participating firms, partner agreements have been updated within three years; at 27% of firms these agreements have been updated within the last 12 months; and at 7% of firms they haven’t been updated in 10 years or have never been updated.
Fifty percent of participating firms have a formal
process to cull clients. Of those that culled clients, firms on average reduced their clients by $290,000. For firms over $30 million, the average revenue culled was $630,000, or a little over 2% of revenue.
Eighty-one percent of firms offer business development incentives to staff and/or partners. In 37% of firms, these incentives are paid out for a year for new clients while in 13% of firms, staff receive incentives for the life of the client.
Human Resources
Eighty-five percent of firms have a formal internship program. On
average, participating firms hire56% of their interns annually, with firms above $50 million hiring 67%.
Employees aged 60 and older account for 11% of staff across all revenue bands, down from 12% last year. Fifty-five percent of staff are under 40 with 30% of staff under 30. Recruiting costs as a percentage of net revenue are less than 1% for firms at all revenue sizes.
For the 82% of firms that have a college recruiting program, they are recruiting at an average of eight colleges. For firms above $30 million, 99% have a college recruiting program and they are recruiting at an average of 19 colleges.
Information Technology
On average, firms employ one IT professional for every 33.9 FTE firm personnel, ranging from 29.2 in
the $10- to $15-million firms to 45.2 in the $30- to $50-million firms.
Firm management has become increasingly more secure with cloud computing over the past few years. This year, 69% of firms say management feels more secure with cloud computing versus internal structure. This number is up from 59% last year.
A little over half (56%) of all firms are proactively learning and researching about artificial/augmented intelligence, while 18% of firms are taking a “watch and wait” stance and 3% are unsure how they are going to handle AI.
Additional data can be found in the full reports. If you’d like more information on how to take your firm to the next
level through insights from IPA’s reports, contact us for more information.
