The Modern Accountant | 🚀 Small Firms, Big Wins: How to Outpace the Giants

A NEWSLETTER AFFILIATED TO

Editors Pick 📣

Why The Future Of Accounting Is Strategic And How Payment Automation Helps You Lead It

• Only 27% of firms use modern systems — yet 67% are ready to adopt.

• 46% of firms lose 3+ hours each week reconciling accounts.

• Expanding services drives 84% retention for medium-sized firms.

Interested in hearing more? Can you relate to any of the above?

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Sector Spotlight 🌟

LEGAL TECHNOLOGY RISKS

Use Of AI In Tax Case Criticised By UK Upper Tribunal Judges

Recent developments in tax litigation offer a potent reminder: relying on AI-generated legal arguments without thorough human oversight is fraught with risk. The Upper Tribunal’s decision in HMRC v Marc Gunnarsson [2025] highlighted this, as Mr Gunnarsson—representing himself—used AI to draft arguments that cited fictitious tribunal decisions. While the Tribunal refrained from penalising him heavily, noting his lack of legal training, future cases may not be treated so leniently.

The judgement draws a clear line: whether you’re a lawyer or an individual, you remain responsible for the accuracy and credibility of your submissions, AI assistance notwithstanding. Professional standards now demand heightened vigilance, as misuse of AI—even innocently—can result in sanctions. As AI tools become more common, diligent verification is non-negotiable; cutting corners could lead to real legal and reputational jeopardy.

PRACTICE TRANSFORMATION

How Will Your Tax Service Distinguish Itself Amidst Advancing Technology and AI

With AI democratising tax knowledge, simply being a technical expert is no longer a sustainable competitive advantage. Successful tax practices will need to differentiate themselves by the way they deliver client outcomes—seamless customer experience and service efficiency, powered by smart integration of AI and robotic process automation. The traditional game of “we know something you don’t” is over.

Future-ready accountants must blend technical tax skills with technology fluency; those who adapt quickly, particularly in smaller, agile firms, can outpace larger competitors. Training will need to pivot, prioritising client experience and commercial judgement over basic technical grunt work. Ultimately, firms that invest in upskilling staff and continually enhance both the staff and client experience will flourish, while others risk becoming obsolete.

ARTIFICIAL INTELLIGENCE

Embracing AI as the Overachieving Intern Transforming Modern Accounting Practices

AI is quickly becoming the indispensable “overachieving intern” in accountancy, effortlessly crunching massive datasets and spotting patterns that would elude even the most seasoned professionals. Its natural language skills mean finance teams no longer need to learn new tech languages, allowing AI to take over repetitive and analytical tasks while boosting productivity by as much as 25%. Yet, AI’s flaw—its lack of ethical judgement—remains its Achilles’ heel.

True progress comes from blending AI’s tireless efficiency with uniquely human qualities such as creativity, emotional intelligence, and moral decision-making. Optimal results demand oversight, strong ethics, and continuous learning from humans, ensuring AI is both effective and responsible. Ultimately, AI is a powerful collaborator, but it’s our insight, not just its algorithms, that will safeguard the future of both the profession and the planet.

FINANCE TRANSFORMATION

Finance Transformation Requires Willingness To Learn, Adapt, And Accept Occasional Failure

Transformation in finance isn’t just about processes or tech—it’s about mindset. Success hinges on team members embracing uncertainty, learning through missteps, and iterating on plans instead of chasing perfection. As new facts emerge, teams must adjust their G.A.M.E P.L.A.N accordingly, replacing initial assumptions with data-driven decisions. The Programme Management Office (PMO) manages daily challenges, while the Transformation Programme Board handles escalations and ensures alignment to business outcomes.

Critically, a strong executive sponsorship is essential—leadership needs to actively support and advocate for the team, not just endorse from afar. Finance professionals must get comfortable with failure, fail fast, and adapt quickly. In short, genuine transformation occurs when organisations cultivate a willingness to learn and pivot, keeping sight of long-term goals rather than getting bogged down in the quest for faultless execution.

TAX STRATEGY INSIGHT

The Importance of Year-Round Tax Planning for Small Business Owners

Year-round tax planning is not just a chore for small business owners—it’s a strategic advantage. Keeping an eye on tax obligations throughout the year, rather than panicking at the end, helps minimise liabilities, uncover valuable deductions, and avoid expensive mistakes. Proactive planning means you’re not just organising receipts, but actively supporting your business’s growth and staying ahead of changes in tax law—a must for compliance and financial health.

Making use of accounting software is more than a digital upgrade; it’s a smart move to automate routine tasks, streamline eCommerce processes, and reduce errors. Regularly tracking expenses—not just in the run up to deadlines—ensures every deduction opportunity is seized, while clarity in cash flow unlocks informed investment and smoother operations. Don’t let tax season catch you by surprise; with a little foresight, tax can move from an annual headache to a valuable tool for business success.