The accountancy profession is struggling to hire experienced auditors and new talent, as salary pressures and excessive workloads are felt across the board.
With the demand for auditing services continuing to rise, many firms across the UK are facing a staff deficit – particularly when trying to find qualified professionals to fill key roles.
The post-pandemic skills and talent shortage, backed by an uncertain economic outlook, have exacerbated the issue, as highlighted by the annual audit quality inspection (AQI) reports, published by the Financial Reporting Council (FRC), last week.
Staffing and retention issues were cited as one of the key areas for improvement across Tier 1 firms, with the majority being scrutinised for their ‘lack of audit professionals’ and mounting recruitment challenges.
According to the audit watchdog, the profession was riddled with ‘resourcing difficulties, resulting in a limited and competitive market’.
‘Attrition has fallen across all firms during the year, but resource constraints still exist. To respond, firms have developed a reassessment of their recruitment strategies to attract a broader demographic and explore other non-traditional routes of entry’, the report said.
For Big Four firm EY, the FRC cited management challenges and substantial workload as an ongoing weakness within the firm’s culture, with employees lacking a ‘clear connection’ with on-site coaching.
Challenges in working patterns and mitigating a healthy work-life balance remain prominent within the profession, with long hours and limited flexibility continuing to grind those in practice.
Traditional ways of working are becoming increasingly less attractive to new talent, particularly with the rollout of hybrid-working, which has shifted to the default for many companies since the pandemic.
EY has since developed a ‘new index’ to track the work intensity placed on their employees, which includes dialogue with teams across the business to understand what reducing work intensity means, and what the barriers might be.
It has also expanded access to coaching support, which will include the launch of a ‘quality enablement network’ of senior managers.
Staff retention was also referenced by the audit watchdog, which recorded ‘serious problems’ within KPMG’s framework.
Facing an uncertain economic outlook, potential candidates are demanding higher wages, better perks, and greater flexibility, like with post-pandemic shifts like hybrid working.
For those currently in practice, accounting teams are feeling burnt out at the prospect of long hours and burdensome tasks – leaving many open to considering new positions, and even complete career changes.
Firms like Mazars were also scrutinised for providing ‘limited access to staff support, with limited processes in place to ensure that staff bonuses were appropriately considered.
Combining training with genuine development opportunities, with a strong access to support, is integral for employee retention, and greater standardisation in addressing this stood as a key complaint by the FRC across all Tier 1 firms assessed.
Insufficient recruitment decisions were also recognised, as seen for BDO, which displayed a ‘complete lack of’ complete interview templates for potential candidates.
The firm has since implemented ‘further training programmes’ to counter this issue.
Article from Accountancy Daily 12/07/23