Monday, April 22, 2024

There’s an Accountant Shortage, It’s Becoming a Big Problem

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This article originally appeared on Business Insider.

The accountant shortage is so bad that companies are delaying filing key mandatory reports.

On Friday, Tupperware said it didn’t have enough accountants to get its annual report out on time. The storage container manufacturer is the latest on a growing list of companies that have delayed their annual reports for a host of reasons. About 70 companies have postponed annual reports this year, up 40% from last year, research company Intelligize tallied last month.

In a regulatory filing, Orlando-based Tupperware blamed the delay on “significant” past and present accounting attrition, “which has resulted in resource and skill set gaps, strained resources, and a loss of continuity of knowledge.”

Tupperware added that previous delays in filing its 2022 annual report led to postponement of its quarterly reports, which subsequently pushed back work on its 2023 annual report.

On LinkedIn, the company is hiring for a single accountant, a job in Poland.

Once an American kitchen icon, the manufacturer now faces a slew of business problems. In October, its external accounting firm, PricewaterhouseCoopers, dropped the company as a client. Almost a year ago, Tupperware warned investors of potential bankruptcy amid greater losses and operational costs.’

Accountant staffing issues at Tupperware and other businesses are becoming an operational headache with no signs of abating.

Seasoned accountants are retiring while the profession, which has a reputation for long hours and unfulfilling work, has struggled to attract younger talent. The American Institute of Certified Public Accountants said that 75% of certified accountants reached retirement age in 2020. The US Bureau of Labor Statistics projects there will be 126,500 openings for accountants and auditors each year, on average, over the decade.

But many students say they are turned off by the fifth year of college needed for accounting courses. And accountants’ average starting salary of about $62,000 looks less appealing than other higher-paying or lower-stress jobs in business.

“Accountants and auditors are to business as those people in the black-and-white-striped shirts are to sports. We’re the referees of business,” Steven Kachelmeier, the chair of the accounting department at the University of Texas, told Business Insider last year.

“We may not always like the referees, but sports is a free-for-all without them,” he said, explaining that if shortages of these workers continue, accountability and integrity in business could suffer.

This year has seen a slate of high-profile financial reporting errors, some of which caused stock prices to change. In February, ride-hailing app Lyft erroneously reported in its fourth-quarter earnings release that it expects profit margins to increase by 500, not 50 basis points — which led its stock to surge 60%. Electric vehicle maker Rivian and gym company Planet Fitness said they made earnings typos this year.

In a similar move to Tupperware, toy giant Mattel said in a February filing that it was unable to file its 2023 annual report due to “certain deficiencies in its internal control over financial reporting.”

The Securities and Exchanges Commission can issue penalties for erroneous filings, including fines for delays and errors in financial reporting.



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