Empirical Insights into Small- and Medium-Sized Accounting Firm Success in the United States: The Importance of Technology and Innovation

ABSTRACT This paper examines factors contributing to perceptions of success within small- and medium-sized accounting firms (SMAFs). Although numerous practitioner articles and podcasts discuss success factors, empirical evidence that controls for confounding effects and supports these determinants of success remains scarce. To address this gap, we survey 192 firms and identify being ahead in technology adoption as the most significant factor associated with success. Specifically, firms that demonstrate perceived leadership in leveraging technology outperform their peers across multiple data collections. Exceeding customer expectations also emerges as a contributing factor, albeit to a less robust extent. We also find some evidence that culture and organizational values are positively related to success but no evidence linking advisory services relative to compliance (i.e., assurance and tax) to firm success. These findings offer actionable insights for SMAFs, highlighting the strategic value of investing in accounting technology and maintaining a client-centric focus to drive firm performance.