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1 May 2009
While their capital city counterparts are laying off staff, regional and rural accountancy practices and many other regional businesses still face a staff shortage, a Deakin University accounting expert says.
Speaking at a recent Skilling for the Future congress in Sydney, Associate Professor Graeme Wines, from the University’s Warrnambool Campus, said early findings from a national survey of regional and rural accounting firms had found that unlike accounting firms in capital cities, the demand for the services of rural and regional accounting firms had not been significantly affected by the current economic crisis and drought. Deakin University is a major partner in the ongoing research.
“Large accounting firms in the capital cities have been putting off staff citing a dramatic reduction in management consulting work, such as mergers and acquisitions advice,” he said.
“But that type of management consulting advice represents only a small part of rural and regional accounting firms’ services. The regional firms have therefore not seen the fall in demand for their services that the biggest accounting firms have.’’
Professor Wines said regions have felt the impact of the economic downturn differently.
“Regions dependent on mining for example have been particularly badly hit, but the large mining companies generally use the large capital city accounting firms and not the regional firms.
“Many of the small and medium size enterprises in regional centres that were interviewed as part of our research project are still doing relatively well.”
Professor Wines said if regional businesses were facing difficulties, their accountant was usually their first port of call.
“All the red tape facing business is still there, so businesses still require the input of their accountant,” he said. “Hence, regional accountants are still working long hours to cope with the demand for their services.”
Given regional accounting staff shortages, Professor Wines points out that practice succession is also a major problem for regional accounting firms.
“A key question is whether there are enough newer staff coming in who will be inclined to step in and take on the responsibility of becoming a partner – previously the pinnacle for a career in public accounting.
“Our interviews with sole accounting practitioners in the very small regional towns indicate they may simply have to shut up shop when they retire.”
Professor Wines called on policy makers to ensure regional and rural areas are not forgotten when developing policy for addressing future skills shortages.
“Education policies, particularly those aimed at ensuring the participation of regional youth, need to be framed now and take a long term view,” he said.
“A key solution to the problems rural and regional accountancy firms face is based on the premise that graduates from regional areas are more likely to seek employment in regional areas.
“In Warrnambool for instance accounting firms and other businesses have been actively offering part-time employment, internships scholarships and cadetships to students enrolled at the local Deakin campus in an effort to have these students stay on when they graduate.
“But a worrying trend is the decline in students attending regional university campuses. While students need to be aware of their options, the problem is exacerbated by the ageing teacher population.
“In many regional areas, for instance, economics is no longer taught at Year 12 level due to staff shortages and student demand. The question to be asked is will accounting be similarly affected?
“One proposal has been for schools to merge their senior schools to ensure adequate staffing, an increase in subject offerings and viable student numbers.”
About the study
543 accounting practitioners in rural and remote areas around Australia participated in the first phase of the study. As well as talking to accounting practitioners, researchers are in the process of interviewing and surveying a sample of their clients.
Associate Professor Graeme Wines
Associate Professor in Accounting
03 5563 3271