Blog: Gaps appearing across accountancy and finance sector

Our individual and collective experiences within the accountancy and finance sector undeniably demonstrate that skills gaps are developing and widening

Fri, 21 Aug 2015 | By John Smith, RK Group associate director

Our individual and collective experiences within the accountancy and finance sector undeniably demonstrate that skills gaps are developing and widening.

It is getting harder to swiftly identify and secure a strong SME financial controller

In recent years, some small businesses unfortunately ceased trading. This led to a spike in accountants looking for new positions. Alongside this, a range of businesses faced cash-flow issues and took action by recruiting from this bank of talented accountants to help keep a tighter handle on cash management. 

As we enter stronger economic conditions, start-ups and privately held growth businesses are increasingly seeking an accountant to support business leaders in facilitating sustained growth by providing a firm infrastructure of financial control and management reporting. 

Managing directors almost always seek an individual who has done this role before. It is therefore a finite pool and it’s only a matter of time before the merry-go-round stops and directors will need to take candidates from number two positions, or those from a practice environment and who may not exactly fit the job specification. 

It is getting harder to identify and secure technical accountants with niche vertical-sector-specific expertise

Qualified technical accounting roles with specific requirements — corporate reporting accountant, group accountant, technical reporting senior specialist, internal audit manager, for example — are niche by nature. As businesses look to grow and invest, they naturally have requirement for a higher degree of technical expertise surrounding official accounting and reporting standards. Large businesses are looking to diversify in current conditions to capitalise on economic optimism, some finalising acquisition of businesses outside of their core markets and expertise. This will create gaps in the experience of their finance function. 

As has been widely documented, the top 10 accounting groups that typically feed businesses this expertise have invested lightly through the recession and are also finding it tough to recruit the right volume of appropriate ‘partners of the future’. It has been headlined that EY have relaxed their academic recruitment criteria to remedy their own skill shortages. This is translating to fewer professionals capable of providing technical accounting advice or audit capability.

There are fewer strong part qualified accountants with experience in parallel with their studies than there are vacancies for this candidate profile

In many cases, businesses pulled investment during the recession in their studies while also shielding them from broader projects. In addition, accounting and finance graduates of recession times find it difficult to secure varied accounting roles and some have found themselves in narrower roles across accounts payable and receivable, creating a skill shortage around the broader month end knowledge. The result being a gulf between the number of ACCA and CIMA [professional accounting qualifications]-part qualified candidates who have gained broad experience versus the number of businesses now seeking this ‘up and comer’.  

It is getting harder to identify and secure ‘all-rounders’ across transactional finance

Through the recession, qualified accountants became more involved in the ‘nitty-gritty’, the tangible result being that we are seeing more payroll professionals who have not had the opportunity to manage the payroll process ‘end to end’ and similarly purchase ledger professionals who may not have taken responsibility for the full payment run, for example.  

Alongside the overarching gaps in our markets there are smaller pools of shortage in vertical industry sectors 

Property Management and construction sectors are recruiting finance and accounting staff more frequently. This is a significant and very visible swing in job flow within these sectors versus 2013-14 when the sectors remained in a phase of caution or consolidation. 

One of the symptoms is that there is now a real skill shortage of client accounting and service charge accounting experience. Housing associations are finding difficulty in securing candidates with experience also as post-election caution has dissipated and funding or headcount budget can be mapped. 

Manufacturing groups are finding it tough to secure candidates with a costing background. As boards of directors and business owners grow in confidence, it translates to more risk and more investment in new facilities, acquisition of new sites and exploration of new products.  

The projects and ventures require accounting support and in particular we are being asked to find candidates with knowledge of standard costing and costing model development. Again the fact is we are beginning to see more job specifications than there are perfect candidates with this manufacturing background. 

A trend is adoption of cloud-based enterprise resource planning technology. Forward-thinking partners have embraced the online format and are developing their own internal experts at senior and even semi-senior level. Others, potentially more traditional practice environments, are not investing in or adopting the new format as readily and as such are creating skill gulfs between those familiar with this expertise and those who are not which again may play out through the rest of this year and into 2016.

Ultimately the evidence of our specialist teams in all locations absolutely demonstrates that there are skill gaps developing within the accountancy and finance field from entry level to director level. 

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