The smallest accounting practices and their clients are not immune to macroeconomic instability, shows the latest IFAC SMP Quick Poll, conducted in late 2012.
With the continuing sovereign debt crisis, a double-dip recession in the Eurozone, and rising inflation in some regions, economic uncertainty pervaded many of the responses to the poll of small- and medium-sized accounting practitioners (SMPs).
Despite these concerns, SMPs remain cautiously optimistic, showing their resilience and perseverance during challenging times.
After keeping up with new regulations and standards, three issues related to the health of the economy—attracting and retaining clients, pressure to lower fees, and rising costs—topped the list of challenges faced by SMPs.
Similarly, respondents indicated that their clients, small- and medium-sized entities (SMEs), are most challenged by regulations followed by economic uncertainty.
Respondents generally expect little change in business performance in the coming year; however, slightly more SMPs (5 points more) indicated they expect business to improve in the coming year compared to those who said the same at the end of 2011. They expect this growth primarily to be driven by revenue from new clients.
While respondents identified the reputation and credibility of the profession as a top issue facing the profession in 2013, they generally ranked public perception of the profession in their country/jurisdiction as average to above average and expect this perception to improve by 2025.
“As drivers of growth and development, small businesses are extremely important to the health of local and global economies," says SMP Committee Chair Giancarlo Attolini. "We must not underestimate the value of this sector and the role that accountants play in supporting SMEs as trusted business advisors."
Attolini says regulators and standard setters need to be mindful of the impact their requirements have on SMPs and SMEs; as the poll results show, this is an area that continues to challenge both small businesses and their accountants.