Unlock the Power of Accounting Talent in Private Equity

With high turnover rates, increasing workloads, emerging skills gaps, and a limited pipeline of new talent, the accounting industry is facing a multifaceted talent crisis. But a robust accounting and finance function is crucial to every business’s success – especially in the private equity (PE) space as firms seek to maximize the value of their investment. That means private equity firms and their portfolio companies must get strategic about how they acquire, develop, and retain top talent to remain competitive and position themselves for success. In our recent webinar, “The Economy, Taxes, and Talent: Get Prepared for What’s Next,” our private equity specialists discussed some tips for talent acquisition and retention in the accounting space.

• Determine the level of need in your organization. Take a deep dive and find out what your organization needs are in your current day to day and think about how those needs might change based on your growth and business goals. Consider how to balance your current resources to meet the internal and external needs of the organization now – and what you might need in the future. For example, right now your business might only need a resource who can manage basic bookkeeping and profit and loss (P&L) statements – but, you might have growth plans that would require hiring a resource with a wider skill set, such as a controller. In a healthcare model, one office might have a doctor, a nurse practitioner, and a nurse – and who provides service depends on the level of the patient’s need. In your organization, it’s important to know what that need is now and how the need might grow and shift in the future.
• Understand the needs of your targets. Apply the same organizational need considerations to any acquisition target you have in mind. As part of your due diligence process, use this same exercise to evaluate what kind of talent your target currently has, where there might be gaps to fill, and how the deal itself could affect the needs of the combined organization.
• Create strategic hiring practices. Once you’ve assessed your needs, it’s time to fill in the gaps. Work to align your hiring strategies to bring in talent with a strong understanding of accounting and finance. This exercise can help you measure operational growth and improvement now, as well as prepare for future growth.
• Seek external assistance. Sometimes it’s difficult to find the talent you need within your organization – or, you might have identified a short-term need that doesn’t require a permanent role, only temporary assistance. In these cases, it can be helpful to hire a third-party firm or consultant to fill the expertise gaps, especially for critical functions like bookkeeping and financial reporting.
• Invest in education requirements. It takes 150 hours to meet the education requirements for being a certified professional accountant (CPA), and meeting that requirement is an issue throughout the profession. Organizations such as the American Institute of CPAs (AICPA) and the National Association of State Boards of Accountancy (NASBA) are considering initiatives that would offer more opportunities to meet initial requirements, but these programs are in the review phase. If your organization has the ability to help your accounting talent meet that 150-hour education requirement by supporting master’s programs or alternative educational pathways within the organization, it could help grow and support internal talent while still meeting your organizational needs. Also, consider offering or supporting continuing education for your current accounting team to help them stay up to date with new regulations and best practices.

Tips for talent retention

• Determine priorities for operational improvement. As part of the process to understand your operational needs, you’ll likely also identify areas for operational improvement. Do you have the talent in your organization to make those improvements, or are there people or roles you could develop to drive those improvement initiatives? Using current talent in these areas, even if it requires additional training or role shifts, allows you to maximize organizational knowledge while offering a place for talent to grow with the company.
• Focus on needs, not roles. Determine what you need to get done and at what level and the skills needed to accomplish the goals – and then try to match those needs with your current talent. Don’t just hire for roles – hire for the capabilities you truly need. If possible, invest in training and development opportunities to upskill your current staff in a few key areas rather than making an entirely new hire.
• Keep pace with current technology. Staying ahead of technological advancements is crucial. However, according to Gartner’s 2024 CEO and senior business executive survey, most organizations have a long way to go in their digital transformation journeys. CEOs report that a median of 5% of company revenue is spent on digital initiatives annually, but they believe only 66% of those initiatives produce a valuable return.* That’s why it’s vital to invest in training programs that equip your accounting team with the skills needed to effectively use new technologies, such as AI and automation. These technologies can supplement your current processes and allow you to transform the focus of your accounting roles from data entry to advisory and strategic planning.

Hiring talent with specialized accounting expertise has become increasingly crucial for many organizations, but a tight talent market can make that process difficult and time-consuming. Following these tips can help your organization build a strong internal accounting team and identify when you need to seek assistance from a third party with specialized accounting expertise.

* Gartner’s 2024 CEO and Senior Business Executive Survey: The Year of Strategy Relaunches – CEO Priorities in Preparation for Increasing Buyer Demand