The accounting profession is currently grappling with a critical talent shortage, with global implications that are particularly pronounced in sectors like nonprofits. In response, the AICPA professional organization created the National Pipeline Advisory Group to study the problem. Its publication, the Accounting Talent Strategy Report, highlights the magnitude of the issue and identifies actionable solutions.
The shrinking accounting pipeline is evident in several alarming trends. The number of bachelor’s degree completions in accounting fell by 17% between 2017 and 2022. This decline coincides with a 33% decrease in CPA candidates and a 37% drop in CPA licensure, resulting in entry-level accounting personnel shortages that are particularly acute. Meanwhile, these declines exacerbate an already diminishing accounting workforce as 70-75% of CPAs are expected to retire within the next 10-15 years. The accounting talent shortage is serious and promises to worsen.
Nonprofits are especially vulnerable to this challenge. Financial leaders in nonprofits play crucial roles in strategically guiding organizations, as well as maintaining regulatory compliance and managing grants, budgets, and donor expectations. The shortage of accounting professionals increases operational and compliance risks, places additional strain on existing staff, and ultimately may threaten the sustainability of some organizations.
Addressing these challenges requires nonprofits to adopt innovative strategies. For many organizations, outsourcing specific functions—such as redesigning the chart of accounts, assessing internal controls, managing external audits, or bridging staffing gaps between personnel departures and new hires—has become a common, practical solution. Services like those offered by RADAR Nonprofit Solutions help nonprofits navigate these critical transitions with confidence and expertise.
However, once considered a more radical approach, nonprofits are now increasingly turning to the option of outsourcing their entire accounting department to an external provider. By fully outsourcing accounting operations to a vendor like RADAR Nonprofit Solutions, organizations can access a proven system of policies, procedures, and technology, combined with a fully-vertical expert team of nonprofit accounting professionals. This approach allows nonprofits to bypass the accounting talent shortage, reduce operational and compliance risks, and gain peace of mind knowing experienced professionals are at the helm of their financial management.
Ultimately, the accounting talent shortage presents an opportunity for nonprofits to reimagine financial leadership, strengthen operational resilience, and continue to deliver on their missions. Rather than spending scarce time and resources addressing accounting staffing issues at the expense of your mission, RADAR Nonprofit Solutions is well-positioned to support your transformation.