Compliance a significant challenge for SMPs
Complying with standards and attracting new clients are the biggest issues facing small- and medium-sized accounting practices (SMPs).
A global study by the International Federation of Accountants (IFAC) has found that nearly two-thirds of SMPs worldwide are worried about these twin challenges, with rising costs and differentiating from the competition (both 50 per cent) also causing concern.
Regulatory issues ranked highly with organisations in both Europe (63 per cent) and the Middle East (65 per cent).
Tax is projected to be the second biggest area of revenue growth for organisations - behind only advisory/consulting services - with 48 per cent of respondents identifying this sector as being profitable.
"It is encouraging to see SMPs maintaining or growing their revenues as they are a crucial part of the global economy," said SMP committee chair Giancarlo Attolini.
Firms need to recognise the challenges they are facing on both a regional and global scale if they are to be successful in the long term, as this will dictate the areas where they should be prioritising. In an effort to help organisations, IFAC has committed to representing them with regulators, standard setters and policy makers.
The findings demonstrate how there is a "spectrum of opportunities for small businesses", according to Mr Attolini, and this is a wider reflection of the recovering nature of the global economy and the outlook at present.
Indeed, nearly three-quarters (72 per cent) of firms maintained or grew practice fee revenues during 2014 when compared with the previous year. This is a very positive sign for the future of the sector.
This chimes well with our own research into the UK sector, which found that there was sustained growth in the tax market during 2014.