As many as one in seven financial planning firms are still using manual invoicing systems, according to a new benchmarking report by Macquarie.
In a new benchmarking report of accounting and financial services practices, Macquarie found that inefficiency is still an issue for the wealth management industry.
The majority of respondents said they continue to operate from a single office, and they recognise their shortcomings when it comes to efficiency and effective use of technology, said the report.
Overall, financial services firms tend to avoid the scale that is seen in other industries, said Macquarie.
"One in four AFS firms have a work-in-progress period of 45 days or more, which has direct implications for cash flow and working capital," said the report.
"When it comes time to issue the invoices, incredibly, one in seven firms still uses a time-intensive manual system, which can be slow and expensive."
On the other hand, 40 per cent of firms have already migrated to online accounting software, said the report.
"While adding services can increase the value proposition for clients and income per client, the inability to effectively and efficiently scale is holding some firms back," said Macquarie.
When it comes to the highest-performing practices in the report, 82 per cent outsource their IT and technology support.
"Many above-average profit firms appear to come from an accounting heritage and seem to be more adept at adding services – and therefore value – to meet more of their clients’ needs," said the report.
"These firms are focused on building scale, but also on building enduring relationships."
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