A majority of accounting and finance executives in the U.S. and Canada are anticipating that their companies’ compliance burden will increase in the years ahead, though less than half expect the cost of compliance to grow.
A new study, Benchmarking the Accounting & Finance Function: 2014, by the staffing firm Robert Half and the Financial Executives Research Foundation, the research affiliate of Financial Executives International, found that 74 percent of U.S. and 67 percent of Canadian finance and accounting executives said they expect their companies’ compliance burden to rise in the coming years, while 48 percent and 41 percent of U.S. and Canadian executives, respectively, also anticipate the cost of compliance will increase. Nearly all the survey respondents (99 percent in the U.S. and 96 percent in Canada) project the cost of compliance to either rise or remain steady, with 48 percent and 41 percent, respectively, expecting it to increase.
U.S.-based accounting and finance managers work an average of 47 hours per week, while staff-level professionals work 42 hours. In Canada, managers average 46 hours weekly, and staff-level employees work 40 hours.
A strain continues to be placed on staff and resources with more than half (59 percent) of U.S. and two-thirds (66 percent) of Canadian companies still reconciling accounts manually. The average percentage of temporary or project staff in U.S. finance and accounting departments is 8 percent, compared to 5 percent in Canada.
The two most outsourced functions, according to the survey respondents, are payroll (cited by 47 percent of respondents in both the U.S. and Canada) and tax (42 percent and 37 percent, respectively).
“What’s striking is the continuing high percentage of companies that rely on manual reconciliation of accounts—some with thousands of general ledger accounts,” said Robert Half senior executive director Paul McDonald in a statement. “There is a significant opportunity for these firms to streamline the close and use their resources more efficiently.”
The report provides benchmarking data based on input from nearly 1,600 executives from finance and accounting departments at public and private companies in the U.S. and Canada. Executives were asked questions related to six key operational categories: workforce management, accounting operations, financial systems, sourcing, internal controls and compliance. The results are designed to provide a framework for developing best practices and improving operational efficiencies.
“Having access to benchmarking data allows businesses to measure their staff ratios and other activities against those of similar-sized firms and establish best practices for their organizations,” said FEI president and CEO Marie N. Hollein. “Financial leaders can use the insights in this report as a starting point for achieving optimal performance across their accounting and finance departments.”
Robert Half and FEI plan to host a webinar on May 20 at 10 a.m. PDT/1 p.m. EDT, to discuss the report findings. The presenters include McDonald and Thomas Thompson, Jr., FERF senior associate, research. The panelists will discuss major trends, steps for today’s finance leaders and key takeaways from the report.
To register or learn more about the webinar, click here. The complimentary session qualifies for one unit of continuing professional education credit.