Nearly Half of Accounting Firms Outsource Client Accounting Services As Ecommerce Reconciliation Becomes More Complex, Spending $550 Million Per Year
NEW YORK, June 7, 2022 /PRNewswire-PRWeb/ -- As ecommerce grows to 19% of total retail sales, the accounting industry is being challenged to handle the increasing volume of digital transactions for clients. For the majority of accounting firms in the US surveyed by Bookkeep, up to 74% of clients are using at least one ecommerce platform or digital payment method, and Client Accounting Services (CAS) teams are processing more than 14,300 transactions monthly from clients. And while seven out of 10 firms are using applications like Billtrust and QuickBooks to support their accounting and bookkeeping, CAS operations of all sizes are still spending nearly 100 hours, or 2.5 full-time-equivalent weeks, on manual processes across their teams, per month. Individuals spend approximately 38 hours every month doing unnecessary manual work.
New Report by Bookkeep Reveals Manual Work Consumes 25% of Staff Time Every Month, Costing CAS Departments $8,900 On Average in Lost Staff Time; Enterprise Firms Lose 2X This Value Every Month
NEW YORK, June 7, 2022 /PRNewswire-PRWeb/ -- As ecommerce grows to 19% of total retail sales, the accounting industry is being challenged to handle the increasing volume of digital transactions for clients. For the majority of accounting firms in the US surveyed by Bookkeep, up to 74% of clients are using at least one ecommerce platform or digital payment method, and Client Accounting Services (CAS) teams are processing more than 14,300 transactions monthly from clients. And while seven out of 10 firms are using applications like Billtrust and QuickBooks to support their accounting and bookkeeping, CAS operations of all sizes are still spending nearly 100 hours, or 2.5 full-time-equivalent weeks, on manual processes across their teams, per month. Individuals spend approximately 38 hours every month doing unnecessary manual work.
These are among the key findings in the most recent report in a three-part quantitative analysis on the economic impact of manual accounting data entry for retailers and accounting firms. Bookkeep, the smarter accounting automation platform, commissioned marketing strategist Paradoxes, Inc. to survey nearly 700 US retailers, restaurants, nonprofits, and accounting firms across size categories to better understand their ecommerce operations. This second report, Inside the CAS Department, offers insights into the practices, perspectives, and priorities of accounting firms.
According to the survey, 82% of firms must run manual monthly reports for each ecommerce platform always or some of the time. More than a third of firms said they always have to manually consolidate ecommerce revenue data with other transaction types like credit cards, and manually recalculate sales costs, taxes, or other items into standard journal entries (39% and 34%, respectively).
As a result, CAS teams estimate they lose at least an average value of $8,900 per month in staff time spent doing unnecessary manual data entry work. Large accounting firms with 500 or more employees lose approximately 2x this value, estimating manual work costs them $16,400 in lost staff time per month. Due in part to this extra strain, nearly half of all accounting firms outsource their bookkeeping. These CAS operations spend on average $21,700 per month on outsourcing, yielding annual costs of roughly $25,000 - $45,000 per firm, and collectively $550 million per year.
"The lack of data standards in how ecommerce platforms report, calculate, deposit sales and collect what's owed is a logistical nightmare for accountants and bookkeepers. It creates thousands of hours per year of extra manual data entry that leads to staff burnout and can hurt firms' profitability," said Jason Richelson, CEO & Co-founder of Bookkeep.
For more information on the study and to download the full report, visit https://www.bookkeep.com/blog/bookkeep-research-study-part-2/.
Methodology
In February 2022, Paradoxes, Inc. surveyed 697 full-time employees of small, mid-market, major, and enterprise-sized establishments from within the retail, accounting, and nonprofit sectors in the US. The majority of respondents held C-suite, Director, or Vice President titles. The 20-minute survey profiled firms and explored various aspects of their digital ecommerce operations, including products being sold, sales channels, payment processors utilized, and accounting processes impacted by digital transactions. Result totals for each sector sampled were at 5% margin of error.
About Bookkeep
Bookkeep is the leading provider of summarized financial automation and deposit reconciliation for retail, restaurant, cannabis, and ecommerce businesses. Bookkeep automates the time-consuming, complex process of posting daily financials from multiple sales channels to accounting systems like QuickBooks, Xero, Sage Intacct, and NetSuite. Our automation saves accountants and bookkeepers at least 20 hours per month per client. Our platform integrates with Square, Shopify, Grubhub, Amazon Seller, Squarespace, Stripe, PayPal, and many more. For more information, visit https://www.bookkeep.com.
Media Contact
Kelsey Thompson, Bookkeep, 1 4128555332, [email protected]
SOURCE Bookkeep
