Survey of SMPs Shows High Demand for Sustainability Services
by Terri Eyden on
By Jason Bramwell
Almost three-quarters (73 percent) of small- and medium-sized accounting practices (SMPs) worldwide are either providing or have plans to provide sustainability services to their clients, suggesting there is a sizeable market for these services among the small businesses that SMPs typically serve, according to a recent survey by the International Federation of Accountants (IFAC).
Of the nearly 3,700 SMPs surveyed in the IFAC SMP Quick Poll: Mid-Year 2013, 76 percent said the most common sustainability service they offer is advisory services, followed by reporting services (52 percent) and assurance services (42 percent).
Additional Key Survey Results
- Twenty-three percent of SMPs indicated that burden of regulation is the biggest challenge facing their SME clients. Economic uncertainty (17 percent) and pressure to lower prices of their products and services (16 percent) rounded out the top three challenges.
- Keeping up with new regulations and standards (25 percent) is the top challenge facing SMPs, followed by pressure to lower fees (23 percent) and attracting and retaining clients (20 percent).
- What is the fastest-growing source of revenue for SMPs? Thirty-five percent said accounting, compilation, and other nonassurance-related services, followed by audit and assurance (26 percent), advisory/consulting services (22 percent), and tax (17 percent).
- Forty-five percent of SMPs surveyed said acquisition of new clients was their main driver of profitability, followed by better retention of existing clients (23 percent) and increased productivity (12 percent).
Some differences were noted across practice size and region. The larger the practice, the more likely it was to be offering sustainability services. More than half (54 percent) of practices with twenty-one or more professionals indicated they currently offer these types of services compared to 37 percent of sole practitioners.
Practices in Asia (58 percent) and Africa/Middle East (56 percent) were most likely to be offering sustainability services, while SMPs in Central and South America/Caribbean (23 percent) and Australasia/Oceania (32 percent) were the least likely to. Forty-two percent of North American SMPs polled provide sustainability services.
In North America, 83 percent of SMPs offer advisory services, while 61 percent offer reporting services and 53 percent offer assurance services. North American SMPs with a professional staff of between two and five people were most likely to offer all three services.
"The widespread provision of sustainability services suggests that small businesses are increasingly recognizing the tangible benefits of operating more sustainably," IFAC SMP Committee Chair Giancarlo Attolini said in a written statement. "SMPs can help their small- and medium-sized entity (SME) clients in many ways; for example, advising on the costs and benefits of behavioral changes aimed at reducing waste, appraising potential investments in alternative sources of energy, and assisting with the implementation of an environmental management system. This is a large and growing area of demand that SMPs need to be prepared to meet."
About the survey:
The IFAC SMP Quick Poll: Mid-Year 2013 received 3,678 responses and was conducted in sixteen languages from May 29 to July 8. The poll, conducted twice annually, is intended to take a snapshot of key challenges and trends influencing SMPs globally.
You may like these other stories...
IRS audits less than 1 percent of big partnershipsAccording to an April 17 report from the Government Accountability Office (GAO), the IRS audits fewer than 1 percent of large business partnerships, Stephen Ohlemacher of the...
Is it time to consider a value added tax?Forbes contributor Joseph Thorndike wrote yesterday that he believes the tax reform proposal by House Ways and Means Committee Chairman Dave Camp (R-MI) was dead on arrival. But he...
Read more from Larry Perry here and in the Today's World of Audits archive.The planning phase of an audit engagement of an entity using US GAAP or a special purpose framework will, with minor differences, include similar...
Upcoming CPE Webinars
Is everyone at your organization meeting your client service expectations? Let client service expert, Kristen Rampe, CPA help you establish a reputation of top-tier service in every facet of your firm during this one hour webinar.
In this session Excel expert David Ringstrom, CPA introduces you to a powerful but underutilized macro feature in Excel.
This material focuses on the principles of accounting for non-profit organizations' revenues. It will include discussions of revenue recognition for cash and non-cash contributions as well as other revenues commonly received by non-profit organizations.
During the second session of a four-part series on Individual Leadership, the focus will be on time management- a critical success factor for effective leadership. Each person has 24 hours of time to spend each day; the key is making wise investments and knowing what investments yield the greatest return.