Two recent mini-research surveys by cloud accounting software provider FreeAgent* caught my eye recently. At first glance, there is no link between the two of them: one highlights the role AI can play in improving the mental health of accountants while the other second study’s finding is that very few accountants actually understand MTD properly.
Let’s deal with the use of AI first. FreeAgent surveyed 149 accountants and bookkeepers; hardly a massive study, but nonetheless its results are interesting.
First and foremost, the majority of respondents (some 63%) believe that more automation and an increasing use of AI will free up their time and allow them to provide better services to their clients. In particular, over half think that they’ll have more time to work with their clients (rather than doing mundane tasks) and they’ll also be able to use some of this additional time to take on new clients and develop their businesses.
Although the FreeAgent survey showed that the vast majority of accountants say they want to make use of AI and digitalisation in general, the uptake is currently somewhat of a mixed bag and there are practical difficulties (not least cost, but also the myriad of competing software products) in the wholesale adoption and roll-out of technology in our industry.
Perhaps revealingly, over a quarter (27%) of respondents think that more use of tech will be good for their mental health. This is a lot more than the 15% per cent of accountants who, in the other survey, said they not are confident about their understanding of the next stage of MTD and its impact on their clients’ tax affairs. More worrying yet, over a tenth (12%) either “don’t know anything or hardly understand anything” about the next stage of MTD and its impact on tax. Given that MTD is but one example of the increasing use of technology in the tax arena, I suspect this might impact negatively on the mental health of the 85% of accountants who are not confident of their knowledge/abilities in this area. And that’s to say nothing of the mental health of their clients, who really do need to have the profession on their side as MTD becomes the default method of organising and paying tax.
Perhaps unsurprisingly, the majority (97%) of accountants in this second survey believe that their clients need to have an understanding of the legislation. That’s true, but it’s also true that these clients pay our fees because we have a greater understanding than them and can therefore guide them accordingly.
We have a vested interest in this. As a glance through our previous blogs over the past few years shows, M&S Accountancy & Taxation has been proactive in ensuring that our knowledge of MTD is, very much, up-to-date. One of our clients, with our encouragement, took part in the initial MTD studies carried out by HMRC and fed back the resultsto us. While it’s nice to feel that accountancy firms believe that digitalisation will free up more of their time, what really matters is what they do with that free time. Boning up on MTD would seem to be one of the more important things…
Vivian Linstrom, M&S Accountancy & Taxation
* FreeAgent is one of the two main packages used by our clients (the other being Xero). If you need any help with moving to cloud accounting, please get in touch.