Change Management

Time for change

The audit profession must reinvent its talent proposition today to flourish into the future, says Antonis Diolas, head of audit and assurance at ACCA.

Audit firms around the world are struggling to attract, engage and retain the critical talent they need for their businesses to grow and thrive. In fact, research by financial software provider Caseware found that 95% of auditors globally find it either challenging or extremely challenging to hire skilled talent, while 90% say it’s either somewhat or extremely difficult to retain good people.

The scale of the issue is further highlighted by ACCA’s Global Talent Trends Survey 2024, a study of nearly 10,000 professional accountants across 157 countries. The research found that 44% of respondents wanted to move role within the next 12 months, with more than half expecting their next career move to be external to their organisation.

So, what can audit firms do to attract and retain more people? This question is explored, in depth, in a new study by ACCA and Chartered Accountants Australia and New Zealand. The study, titled Attract, Engage, Retain: Insights and Recommendations for Audit Talent Success, is based on roundtable discussions and a global survey of over 6,500 professionals. Over half of respondents to the survey were Millennials. Of these, 37% were current auditors and 33% were former auditors, with the rest considering audit as a future career.

Antonis Diolas

Head of audit and assurance, ACCA

It’s about keeping employees interested in the firms they work for and retaining good talent so that they can continue to grow with, and add value to, the company. After investing in the skills to develop good people, we want to strengthen work environments that keep them.

Given the themes that emerged from the research, the study makes the following recommendations to audit firms:

1. Provide a good work-life balance

Auditing can be stressful work, with audit professionals often required to work long hours, under high amounts of pressure, especially during ‘busy seasons’. This long-hours culture inevitably encroaches on their personal lives, preventing them from spending time with family and friends, taking exercise, or pursuing interests and hobbies. In fact, the research identified work-life balance as the primary factor undermining the attraction and retention of talent across all regions.

One way that firms can respond to this issue is by adopting flexible working arrangements that accommodate the preferences of individuals. ACCA’s Global Talent Trends Survey 2024 found that hybrid working arrangements were the preferred working arrangement for more than three-quarters (76%) of respondents. Other potential strategies for improving work-life-balance include the deployment of technological tools that ease workload, providing advance notice around busy season to allow people to plan, and raising awareness around current work-life initiatives so that people understand which options exist.

Poor work-life balance can be extremely detrimental to auditors’ mental health, causing them to suffer from anxiety, burnout and depression. More than half (57%) of finance professionals who responded to the Global Talent Trends Survey 2024 said that their mental health suffers because of work pressures. Significantly, 36% have even considered resigning due to wellbeing issues. A focus on wellbeing and work-life balance must therefore be a critical component of audit firms’ overall talent strategies. Firms should also prioritise the creation of inclusive, supportive workplace cultures that do not tolerate bullying, discrimination or harassment.

2. Pay fairly

Many audit professionals believe that they are not adequately compensated for the intensity of their workloads during busy seasons. The Attract, Engage, Retain research found that while concerns about remuneration vary by country, remuneration is, overall, the second most important factor impacting the profession’s ability to attract and retain talent.

To avoid losing out on talent for pay-related reasons, audit firms should perform benchmark studies to check how their salaries align with those offered by comparator organisations. They should also ensure that pay keeps up with inflation and fairly remunerate staff for additional hours worked, or else offer time off in lieu.

The Global Talent Trends Survey 2024 reinforces the importance of remuneration as a strategy to retain auditors within the profession. Just over a third of finance professionals (37%) are satisfied with the level of pay they currently receive, with half believing that the best way to boost their salary is to leave their current organisation. Those aged 43 or younger are most likely to be unhappy with their current pay packet.

3. Develop a ‘career lattice’

The concept of the traditional career ‘ladder’, which involves an audit professional devoting considerable time to working their way up through an organisation, does not appeal to many younger audit professionals. Often, they want to move horizontally, as well as vertically, gaining experiences in different service lines and potentially different organisations.

Given this preference, audit firms should consider promoting a ‘career lattice’ approach, where they give their professionals a breadth of experiences that fits those professionals’ interests, including career opportunities outside the audit service line. With this approach, staff benefit from internal mobility as well as the chance to develop new skills that can be harnessed by the firm. To develop a successful career lattice approach, audit firms must listen to their employees, ensuring that audit staff are heard, and their views are acted upon.

4. Provide opportunities in sustainability assurance and reporting

The Attract, Engage, Retain research highlights that the area of sustainability reporting and assurance is a huge opportunity for firms to attract, develop and retain talented people. Younger generations increasingly want work that offers a strong sense of purpose and while they understand the purpose of sustainability reporting, they can struggle to connect with the purpose of traditional financial audit.

Significantly, nearly half (48%) of survey respondents who had no audit experience would be interested in joining the profession if they were offered opportunities in sustainability reporting and assurance. What’s more, 40% of current or past audit professionals would stay, or have stayed, in the profession if they had been given the chance to get involved with sustainability-related engagements.

Audit firms should capitalise on the attractiveness of sustainability assurance and reporting to both attract new entrants to the profession and retain current staff. At the same time, however, they should also communicate the important purpose of the financial audit – which is to build trust and confidence in the capital markets.

5. Embrace technology

Artificial intelligence (AI) is transforming the audit profession by reducing auditors’ workloads while enabling them to add greater value in their work. Going forward, auditors are set to use AI-enabled tools to enhance their processes, better identify risks, quickly analyse large documents, detect fraud more effectively, and stay up to date with changing regulations.

The Attract, Engage, Retain research showed that those considering audit as a future career were strongly attracted by the potential to work with advanced technologies, such as AI. Indeed, 92% of potential entrants would prioritise employers that invest in, and make use of, advanced technologies. Furthermore, 87% of current and past audit professionals share this priority.

Bridging the technology gap must be a strategic imperative for firms looking to attract and retain talent. Alongside capital investment in new tools, firms should provide training to ensure that all staff members, from entry level upwards, are able to effectively harness advanced technologies.

The Big Four firms are currently leading the way when it comes to embracing new technologies. To remain competitive and attract talent, mid-tier and smaller firms need to enhance their technological capabilities. This can be achieved through collaboration with third-party technology providers.

Seize the opportunity

Today, the audit profession stands at a crossroads. Although it remains a desirable and highly respected career choice, it is wrestling with declining numbers of entrants while competing fiercely for talent with other professions. At the same time, people’s expectations of their employers are rapidly evolving, while technological advances are transforming how we live and work. So, the audit profession must seize the opportunity today to address its talent challenges and reinvent itself so that it is fit for the future – a future of sustained growth and impact.

See more on ACCA’s Professional Insights work here.