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How the accounting industry can fend off a talent crisis

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Accounting has long been considered a space ruled by reliability and stability. The industry itself, driven by ceaseless consumer demand and dependable rhythms, promotes job security and often even attracts a certain personality type – creatures of habit who find comfort in familiar routines and steady surroundings. 

Yet the accounting industry is currently in the midst of unprecedented volatility, at least in terms of staffing and maintaining a viable workforce balance. A generation of CPAs is at or nearing retirement age, and the number of new accounting professionals entering the field seemingly won’t be enough to keep up with future needs. Whether the talent crisis in the space is an existential one is up for debate, but this much is clear: Doing nothing isn’t an option. 

The problem isn’t breaking news in the accounting field, but even among those who acknowledge the looming staffing shortfall, agreement on and action toward concrete solutions has been too slow or altogether absent. Change is necessary. Here are some practical steps that, if supported 

across the field, could help shake the accounting industry out of its staffing slump. 

Why the accounting industry is facing dwindling numbers

No surprise here: the Baby Boomers are again influencing the narrative. Many CPAs from this generation are aging out of the working world, as the AICPA indicates that 75% of accountants are at or near the retirement age in the United States. It’s a struggle that is being fought across a number of industries.

But in the accounting field, the candle is burning at both ends. At the same time that CPAs are entering retirement at unprecedented rates, far fewer young workers are falling in behind them to pick up the slack. The stability and security of entry-level accounting positions (and the promise of future growth) are no longer the draw they once were. The two trends have led to a rapidly shrinking talent pool that puts firms — and their clients — in an extremely precarious position. 

Although certain accounting houses may be savvier or better equipped to take on the workforce shortage, everyone in the field is rowing against the tide. It won’t be a problem that is solved individually or even organizationally. Long term, industry-wide staffing is an entrenched, systemic issue that will require big ideas and likely sweeping changes that are embraced and implemented throughout the space. So how does the accounting industry, as a whole, close the labor gap? 

Closing the talent gap in the accounting space

The current labor crisis in the accounting industry has been decades in the making. Any notion that a single adjustment or introduction could stem the tide, or even that a brilliant suite of solutions might instantly turn things around, is a naive hope. One recent survey indicated that 83% of financial hiring managers believe the talent crisis will continue through 2025, and there are plenty who expect it to last far longer, barring significant change. This is going to take a diligent, continuous, collective effort. 

Fortunately, this is the industry’s specialty. Starting with three pillars — but certainly not leaving it there — the accounting field can begin restocking its depleted ranks and building a new brand that will help sustain its numbers over time.

Better incentives: Accountants have always been attracted to the comparatively strong pay, solid upward mobility and relative job security in the field. But, as has been the case in other fields, those benefits don’t go as far as they once did. And because the demands of the tax calendar often shackle firms and their CPAs in many ways, accounting employers may need to get creative in their offerings — everything from first-class professional growth opportunities and a more flexible work schedule to a company car allowance and on-site daycare. 

Adjusted job requirements: Accountants require extensive training and certification — CPA isn’t exactly a learn-on-the-job role. But there may be ways to create nontraditional paths into the industry, particularly in compartmentalized roles that do (or can) allow prospects to grow into more prominent positions. Talent assessment platforms and skills-based hiring can help firms identify quality candidates who can provide immediate workforce contributions while building toward greater long-term value for an organization. 

Rebranding the industry: Admittedly, this is a biggie. Returning to one of our initial points, accounting has long been considered a buttoned-down, straight-arrow industry. And while wanderers and creatives and outside-the-box thinkers may seem incongruous with the industry, there is a space in the middle where accounting firms would find a larger and more diverse talent pool. The big players in the field don’t have to go full Silicon Valley — juice bars, massage rooms and sleep pods — to attract more quality prospects and begin changing what it means to be an accountant. By simply listening to the needs of workers currently in the space (and taking the occasional page from other competing industries), accounting firms can start wooing more and higher-caliber job candidates.

It’s unclear exactly how long it may take to undo the current accounting talent crisis. But given the trajectory of the numbers and the fact that most experts are bracing for the worst for at least the next calendar year, it seems that a focused, industry-wide strategy is in order. At the very least, accounting firms must begin treating every graduating class as an opportunity to welcome more candidates into the labor force. The young, eager workers who once showed up in droves on the doorstep of the accounting industry are far fewer than they once were. It’s time to boost their numbers — and make moves that will keep them in the field over the long haul.

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Accounting

IAASB tweaks standards on working with outside experts

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The International Auditing and Assurance Standards Board is proposing to tailor some of its standards to align with recent additions to the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants when it comes to using the work of an external expert.

The proposed narrow-scope amendments involve minor changes to several IAASB standards:

  • ISA 620, Using the Work of an Auditor’s Expert;
  • ISRE 2400 (Revised), Engagements to Review Historical Financial Statements;
  • ISAE 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information;
  • ISRS 4400 (Revised), Agreed-upon Procedures Engagements.

The IAASB is asking for comments via a digital response template that can be found on the IAASB website by July 24, 2025.

In December 2023, the IESBA approved an exposure draft for proposed revisions to the IESBA’s Code of Ethics related to using the work of an external expert. The proposals included three new sections to the Code of Ethics, including provisions for professional accountants in public practice; professional accountants in business and sustainability assurance practitioners. The IESBA approved the provisions on using the work of an external expert at its December 2024 meeting, establishing an ethical framework to guide accountants and sustainability assurance practitioners in evaluating whether an external expert has the necessary competence, capabilities and objectivity to use their work, as well as provisions on applying the Ethics Code’s conceptual framework when using the work of an outside expert.  

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Accounting

Tariffs will hit low-income Americans harder than richest, report says

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President Donald Trump’s tariffs would effectively cause a tax increase for low-income families that is more than three times higher than what wealthier Americans would pay, according to an analysis from the Institute on Taxation and Economic Policy.

The report from the progressive think tank outlined the outcomes for Americans of all backgrounds if the tariffs currently in effect remain in place next year. Those making $28,600 or less would have to spend 6.2% more of their income due to higher prices, while the richest Americans with income of at least $914,900 are expected to spend 1.7% more. Middle-income families making between $55,100 and $94,100 would pay 5% more of their earnings. 

Trump has imposed the steepest U.S. duties in more than a century, including a 145% tariff on many products from China, a 25% rate on most imports from Canada and Mexico, duties on some sectors such as steel and aluminum and a baseline 10% tariff on the rest of the country’s trading partners. He suspended higher, customized tariffs on most countries for 90 days.

Economists have warned that costs from tariff increases would ultimately be passed on to U.S. consumers. And while prices will rise for everyone, lower-income families are expected to lose a larger portion of their budgets because they tend to spend more of their earnings on goods, including food and other necessities, compared to wealthier individuals.

Food prices could rise by 2.6% in the short run due to tariffs, according to an estimate from the Yale Budget Lab. Among all goods impacted, consumers are expected to face the steepest price hikes for clothing at 64%, the report showed. 

The Yale Budget Lab projected that the tariffs would result in a loss of $4,700 a year on average for American households.

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At Schellman, AI reshapes a firm’s staffing needs

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Artificial intelligence is just getting started in the accounting world, but it is already helping firms like technology specialist Schellman do more things with fewer people, allowing the firm to scale back hiring and reduce headcount in certain areas through natural attrition. 

Schellman CEO Avani Desai said there have definitely been some shifts in headcount at the Top 100 Firm, though she stressed it was nothing dramatic, as it mostly reflects natural attrition combined with being more selective with hiring. She said the firm has already made an internal decision to not reduce headcount in force, as that just indicates they didn’t hire properly the first time. 

“It hasn’t been about reducing roles but evolving how we do work, so there wasn’t one specific date where we ‘started’ the reduction. It’s been more case by case. We’ve held back on refilling certain roles when we saw opportunities to streamline, especially with the use of new technologies like AI,” she said. 

One area where the firm has found such opportunities has been in the testing of certain cybersecurity controls, particularly within the SOC framework. The firm examined all the controls it tests on the service side and asked which ones require human judgment or deep expertise. The answer was a lot of them. But for the ones that don’t, AI algorithms have been able to significantly lighten the load. 

“[If] we don’t refill a role, it’s because the need actually has changed, or the process has improved so significantly [that] the workload is lighter or shared across the smarter system. So that’s what’s happening,” said Desai. 

Outside of client services like SOC control testing and reporting, the firm has found efficiencies in administrative functions as well as certain internal operational processes. On the latter point, Desai noted that Schellman’s engineers, including the chief information officer, have been using AI to help develop code, which means they’re not relying as much on outside expertise on the internal service delivery side of things. There are still people in the development process, but their roles are changing: They’re writing less code, and doing more reviewing of code before it gets pushed into production, saving time and creating efficiencies. 

“The best way for me to say this is, to us, this has been intentional. We paused hiring in a few areas where we saw overlaps, where technology was really working,” said Desai.

However, even in an age awash with AI, Schellman acknowledges there are certain jobs that need a human, at least for now. For example, the firm does assessments for the FedRAMP program, which is needed for cloud service providers to contract with certain government agencies. These assessments, even in the most stable of times, can be long and complex engagements, to say nothing of the less predictable nature of the current government. As such, it does not make as much sense to reduce human staff in this area. 

“The way it is right now for us to do FedRAMP engagements, it’s a very manual process. There’s a lot of back and forth between us and a third party, the government, and we don’t see a lot of overall application or technology help… We’re in the federal space and you can imagine, [with] what’s going on right now, there’s a big changing market condition for clients and their pricing pressure,” said Desai. 

As Schellman reduces staff levels in some places, it is increasing them in others. Desai said the firm is actively hiring in certain areas. In particular, it’s adding staff in technical cybersecurity (e.g., penetration testers), the aforementioned FedRAMP engagements, AI assessment (in line with recently becoming an ISO 42001 certification body) and in some client-facing roles like marketing and sales. 

“So, to me, this isn’t about doing more with less … It’s about doing more of the right things with the right people,” said Desai. 

While these moves have resulted in savings, she said that was never really the point, so whatever the firm has saved from staffing efficiencies it has reinvested in its tech stack to build its service line further. When asked for an example, she said the firm would like to focus more on penetration testing by building a SaaS tool for it. While Schellman has a proof of concept developed, she noted it would take a lot of money and time to deploy a full solution — both of which the firm now has more of because of its efficiency moves. 

“What is the ‘why’ behind these decisions? The ‘why’ for us isn’t what I think you traditionally see, which is ‘We need to get profitability high. We need to have less people do more things.’ That’s not what it is like,” said Desai. “I want to be able to focus on quality. And the only way I think I can focus on quality is if my people are not focusing on things that don’t matter … I feel like I’m in a much better place because the smart people that I’ve hired are working on the riskiest and most complicated things.”

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