The accounting profession has been significantly impacted by recent world events such as the war in Ukraine, the supply chain shortage, and the COVID pandemic. That hypothesis is supported by trends seen in undergraduate accounting hiring.
Each year, the Association of International Certified Professional Accountants (AICPA) investigates the trends in accounting education and the hiring of undergraduate accountants. The future of the accounting profession is critical to industry veterans like John Savignano, CPA, in New York. In a recent interview, he talked about a number of issues, including the need for personalized financial services and insurance and how accounting professionals are branching out.
The Shift in Undergraduate Hiring Practices
One way industry experts like Savignano measure the future of the accounting profession is through reported trends from the AICPA. For example, recent reports show a decrease in accounting graduates in the 2019/2020 academic year.
The report shows a decrease of 2.8 percent for those students pursuing a bachelor’s degree in the field and an 8.4 percent drop for those working towards a master’s degree in accounting. That follows a trend that began in the 2017/2018 academic season.
With a drop in the availability of accounting graduates, CPA firms are hiring fewer people with these degrees right out of college. That leaves them taking on more non-accounting hires. The report indicates that 42.7 percent of new hires at CPA firms do not have accounting degrees.
The Role of Accountants
While somewhat troubling, the drop in those with accounting degrees isn’t earth-shattering. Accountants are unique, and their role in society is changing, according to Fordham University adjunct professor John Savignano. In a recent interview, he said:
“…most accountants just think like accountants, put the number in the box, make sure it lines up. I just can’t stand the way accountants think. So I consider myself more of an advisor. I didn’t want to say a business advisor.”
In other words, today’s accountants wear many hats. They do more than just keep the books and sign the tax forms. They work in life insurance, for example, and are financial advisors. CPA firms can hire non-accounting graduates and grow their firms to offer more services to their clients. That also makes life more interesting for those who work in the industry.
Trends for Accounting Graduates in 2023
Accounting graduates are also looking beyond the traditional role of accountants to expand their horizons. The Journal of Accountancy lists some career trends for those graduating with accounting degrees.
This may be less about actually looking at the books. Many companies are using advanced technology for that purpose. Today, accountants doing audits are looking for enhanced sustainability. By auditing financial statements, these professionals are in the best position to provide environmental, social, and governance (ESG) information.
Since more CPA firms hire non-accounting staff, they need certified professionals to manage them. Add to this list the accounting professionals choosing to run their own practices or to freelance. As a result, they can keep their client list small and manageable and maintain a few quality relationships.
Personal Financial Planning
Although this seems like a growing trend, it is not new. CPAs like John Savignano have been making this work for years. However, he sees his role as more comprehensive.
“I’m becoming more of a life advisor at this stage. But the more I know, the better I can help clients and myself. So knowledge is power, and not have to rely on other people who may jeopardize my relationships…. it was all about client service because that’s the business we’re in. ”
Included in this overall life package, Savignano advises his clients on their insurance needs. He tries to be that one person they come to for answers instead of searching the internet and maybe getting the wrong information.
“But if you can build some level of confidence with your clients or customer, there’s no need for your customer to go to the internet or talk to other people and have five different answers and be totally confused. So you want to be in that position? I don’t think you have a choice because if you want to be good in whatever you do, you have to build that level of confidence with your customer, client, or patient because there’s so much information out there.
About John Savignano, CPA in New York
John Savignano is a native of New York and a St. John’s University graduate. He grew up as a member of a close-knit family and got his first job at his family’s grocery store in Brooklyn.
After earning his BA in accounting, Savignano worked for PricewaterhouseCoopers PwC as a certified public accountant (CPA). During that time, Savignano worked in the company’s audit department before studying tax accounting at Pace University.
Since 1985, he has been a licensed CPA and member of the NYSSCAP and AICPA, and he is now an adjunct professor at Fordham University’s Graduate School of Business.
In this uncertain time, one thing remains clear – people are still looking for the personal service someone like John Savignano can offer them. As a result, one-stop financial care is the accounting trend for 2023 to watch.