CPA Predictions: What to Expect for 2023

The future is always uncertain, the last few years have more than proven that. So while it is impossible to know exactly what 2023 will have in store for us, CPA Australia has highlighted potential challenges and opportunities for businesses to capitalise on in the year ahead. 

Four Things That Will Probably Happen

1. Hacks and Data Breaches 

In the last few months of 2022, an estimated 6.2 million Australians found themselves the victim of large-scale cyber attacks. From Optus to Medibank, it was week after week of data breaches.

In 2023, cyber security will be at the forefront of everyone’s minds. Businesses will be increasing their investment in cyber security. These repeated data breaches may also see consumers begin to question the necessity of handing out personal details.

2. Businesses to diversify suppliers & customers

With the pandemic, geopolitical tensions, and extreme weather events disrupting supply chains over the last few years, businesses have been forced to reassess their supply chains. 

In the coming year, businesses will need to make their networks more resilient by diversifying their suppliers and customers.

3. Crackdown on Digital Services & Products

Digital Services and Products will be under the spotlight next year. 2022 concluded with the Financial Services Minister releasing a Treasury paper indicating that Buy Now, Pay Later (BNPL) platforms could be regulated under credit laws. Crypto assets will also be facing additional scrutiny in the coming months, especially with the collapse of FTX. 

4. Natural Disaster Preparation

2022 was categorised by floods running rampant across the country. While the La Niña event may be easing, there is a 65% chance of a El Niño developing in June 2023. El Niño is the brother system of the La Niña, associated with drier and hotter conditions. While an El Niño declaration doesn’t necessarily mean drought conditions, the last El Niño Australia experienced coincided with catastrophic Black Summer bushfires in 2019/20. 

Hence, businesses will be preparing themselves against any disaster by reviewing their operations, checking their insurance coverage, and seeking advice.

Four things that probably won’t happen

1. Major cost-of-living relief

Unfortunately, it’s unlikely we’ll see cost-of-living pressures easing significantly in 2023 with global forces pushing up energy prices and fuel costs appearing unlikely to abate. 

Similarly, the government will be hesitant to provide major direct short-term relief in the upcoming May federal budget for fear of exacerbating inflation problems by pumping money into the economy. Businesses and households need to prepare as their expenses continue to climb.

2. Skills Shortage Fix

The skills shortage across the country will continue next year. Although the government has taken some steps to address these issues, including the increase in the skilled migration intake for 2022–23 and incentives to undertake training in priority areas, this is a long-term problem that will take years of focus to solve. 

The shortage of talent will continue to challenge businesses and we won’t see a fix in the short term.

3. Tax reform

There has been plenty of discussion about the potential for tax reform over the past year. CPA Australia has been encouraging the federal government to lead GST discussions with the states and territories to help the transition away from inefficient taxes, such as stamp duty. 

However, broad-based tax reform in 2023 is not expected.

4. A full return to the office

It looks like flexible working is here to stay for a large group of typical CBD-based workers. The pandemic changed the expectations of employees and with staff in short supply, it’s likely remote work will continue to be an option. Businesses allowing their employees to work flexibly are usually rewarded with higher staff satisfaction, lower turnover levels and access to a wider range of talented staff across the country.

While it’s likely that not all of these predictions will come to fruition, a keen awareness of what may await businesses in 2023 will prove essential for your business planning and preparation.

Source: accountantsdaily | Compiled & Edited by Tailored Accounts

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