Firms are seeking to make major technology investments this year, especially when it comes to automating tax return workflows, which was cited as a major priority by accounting leaders.
A recent survey from Wolters Kluwer found that tax return automation tools were the No. 1 solution firms planned to invest in this coming year, with 19% of respondents announcing their intention to do so. This aligns with other data in the survey, which found that 41% of firms cited "automatically populating tax returns, reporting and financial statements" as a benefit they expect from their technology purchases. It also speaks to the 27% of firms who named "increase automation to improve workflows and processes" as a strategy they intend to pursue in order to meet their goals for this year.
Automation tools, though, are not the only tax-related item firms are eyeing in 2025. The survey also found 15% are planning to buy tax compliance solutions, and another 15% are planning to buy tax law monitoring and research solutions.
Firms are also eager to buy client portal solutions (17%), client data ingestion tools (16%), document scanning and extraction solutions (16%), AI search and/or productivity solutions (14%), client accounting solutions such as write-up and bookkeeping (14%), and data analytics/visualization tools (14%). The survey also found 18% are seeking beneficial ownership information reporting solutions for the Corporate Transparency Act, the status of which will be determined soon by the
Not that they've necessarily been sleeping on tech upgrades this past year. The survey found that firms made extensive technology investments over the past year, especially compared to 2023. A full 44% of firms surveyed said they implemented a client accounting solution last year, compared to 25% the previous year. Similarly, 39% of firms invested in client portal solutions (up from 28% the previous year), 35% implemented AI search and productivity tools (up from 1%), 28% invested in document scanning and extraction solutions (up from 3%), 27% implemented bank reconciliation and validation solutions (up from 9%), 27% implemented financial report prep software last year (up from 11%), 25% implemented document management solutions (up from 17%), 19% implemented fixed asset solutions (up from 12%), 14% implemented audit methodology solutions (up from 4%), 14% invested in project management solutions (up from 6%) and 11% bought workpaper management and trial balance solutions (up from 10%).
Despite these investments, though, firms want more from their tech stacks. Chiefly, 48% of firms are looking for solutions that enable anytime, anywhere access; 41% want both automation as well as tools that facilitate requesting and collecting documents from clients; 37% want solutions that assist with data input and ingestion; 27% want software that reduces or eliminates manual repetitive tasks; 26% want support efficiencies by implementing advanced technologies such as RPA or AI; 25% are especially concerned with protecting sensitive information and data; and 24% want electronic delivery and payment of invoices.
Cloud and integration
The survey also found that years of investment in cloud infrastructure and software integrations are also paying dividends.
In terms of cloud computing, the survey found that 25% of firms have tech stacks that are fully in the cloud, and 42% of those not entirely in the cloud plan to move at least partially to the cloud in the next one to three years, while 19% of them plan to be fully cloud-based in that time frame. In contrast, only 17% of firms keep their tech stacks full on premise, and only 14% plan to remain that way.
These tech stacks are increasingly integrated as well. More than a quarter of respondents, 26%, said their tech stack was between three quarters fully integrated, and 31% said their tech stack was between half to three quarters integrated. Meanwhile, 34% had less than half their tech stack integrated (19% had zero to a quarter integrated).
The Wolters Kluwer survey found, in both cases, that cloud infrastructure and tech stack integration correlated with higher firm revenues. Cloud-based firms were more likely than traditional firms to report increased revenue (76% to 79%), increased profit (71% to 80%) and client engagements (67% to 76%). Meanwhile, among firms using fully integrated solutions, 55% reported revenue increases of 10% or more. On the flip side, of those firms that were less than 49% integrated, only about a quarter reported a similar revenue increase.
The survey did not assert a direct causal relationship between these things, so it might be that more profitable firms have more resources to invest in cloud infrastructure and tech stack integration, but regardless the survey still found a relationship.
Accountants as innovators
This prioritization of technology speaks to changes in how the accounting profession perceives itself, as the proportion of firms identifying as innovators is the highest it's been in three years.
The Wolters Kluwer survey found that 44% of firms self-identify as either innovators or early adopters, the highest level in three years. In this survey, an innovator is defined as someone who actively seeks and adopts the newest available technology and works with software partners to develop and test it, while an early adopter is someone who adopts technology, once it's proven, generally ahead of peers. Notably, the number of firms that identify specifically as innovators jumped by 14 points year over year, from 5% to 19%. Wolters Kluwer believes this speaks to a changing self-perception within the accounting profession as being increasingly tech-driven.
"There's a noticeable shift in the industry as accountants and auditors increasingly embrace technology as a key driver of success," said the report. "Whether enhancing client service and engagement or digitizing client document collection, software is proving to be a valuable ally."
