Accountancy firms more likely to increase their fees
The number of accountancy firms contemplating poaching senior staff and their teams from their rivals has more than doubled in the last year, rising from 8% to 22% of all firms as the economy warms up, says Bloomsbury Professional, a leading tax and accounting information group.
Martin Casimir, Managing Director of Bloomsbury Professional, which surveyed accountancy firms about how they planned to boost their profits, explains: "Previously, firms were cautious about poaching senior employees from rivals as this would result in higher salaries and costs, without any certainty that they would win new business as a result."
"However, as the economy begins to recover, accountancy firms are on a more stable financial footing, and are determined to build up strength in order to be first in line for the increased amounts of advisory and corporate finance work they anticipate."
This renewed confidence is also reflected by the proportion of accountancy firms which feel able to increase their fees. 75% of firms are now considering increasing hourly rates and project fees, a slight increase on 73% in 2012. `
Bloomsbury Professional says that clients have been very resistant to fee increases throughout the recession.
Martin Casimir explains: "Corporate cost cutting meant that accountants were likely to be asked to cut their fees. Now there seems to be signs of the recovery in this area."
The possibility of significant further redundancies in the accountancy sector now seems to be receding with 83% of firms saying that they were unlikely to cut head count in order to boost profitability.
Martin Casimir continues: "As the economic recovery strengthens, there are signs that accountancy firms are starting to feel fairly secure. A significant proportion are comfortable with the idea of increasing their fees which suggests that competition is becoming less fierce, while even more are prepared to make the investment needed to target new sectors for work."
"The fact that fresh rounds of redundancy are now off the agenda for most firms is also very welcome news. However, that does not mean that accountants are throwing caution to the winds as tight credit control is still very much to the fore."