Skill shortage bites for rural and regional accountants
Rural and regional accounting firm services are the focus of a major research project, supported and partially funded by CPA Australia. The three-year project, jointly undertaken by the University of Melbourne, Deakin University and RMIT University, aims to identify performance issues clients may have with regional and rural firms.
It will also unearth the challenges such firms face, and look at possible solutions. Funded by an Australian Research Council linkage grant ($228,000), with CPA Australia contributing $60,000, the research explores in depth a number of key challenges identified in CPA Australia's Firm of the future report.
The research kicked off with a qualitative pilot program of interviews with Victorian firms and their clients. Over the next six months similar interviews will take place in regional areas in New South Wales, Queensland, South Australia, Tasmania, Northern Territory and Western Australia.
Additionally, 2000 clients across the country will take part in a quantitative survey towards the end of this year. A selection of practitioners in each region will also be surveyed.
Graeme Wines, associate professor of accounting at Deakin University and a principal researcher on the project, says initial client feedback in Victoria, on the whole has been 'very positive'. But he says firms are feeling the force of the accountant shortage. He says the situation regarding financial planning registration is providing roadblocks to growth in the country.
The number of sole practitioners in rural areas is also likely to fall as small family farms consolidate into larger farming businesses, which then seek accounting services from larger firms in regional centres. Retiring farmers will consequently require superannuation and financial planning advice from their accountants. Many rural accountants believe the requirements of the Financial Services Act are unduly onerous; they feel much of the regulation misses the mark and is rather inappropriate for rural and regional practices.
They also have difficulty explaining the constraints the Act places on their ability to give financial planning advice. Like their city counterparts, larger firms have developed financial planning arms, while smaller practitioners refer clients on to planners. What usually happens, says Wines, is that those clients then return to the accountant to have the same advice re-explained to them.
'You could argue that accountants are in a better position to give that advice, but they are not allowed to,' he says. 'This is a bigger problem in regional areas where the client is so tightly tied up with their accountant.'
Rural firms are finding it extremely difficult to attract qualified staff and are resorting to training undergraduates. Practitioners even worry this source will diminish, with fewer young people choosing to study accountancy.
On the bright side, firms have upgraded their IT and communications systems. 'IT use is sophisticated, so that the physical distance from client to accountant is not as much a problem as it used to be,' says Wines.
For further information read the Firm of the future report.
Reference: July 2008, volume 78:06
