‘Confidence has taken a knock but underlying sentiment remains positive’
ACTIVITY 2023 was a busy year for UHY Farrelly Dawe White, with growth of 16% placing us in the Top 20 firms in Ireland and in the Top 15 firms in UHY globally. We committed to our people that we would set in place a strategic plan that would have a clear emphasis on our purpose, values and behaviours. That has allowed us a clear plan towards our strategic objectives through to 2028. Our purpose is to Achieve a Better Future together, for our people, our clients and the greater community.
In 2023 there was buoyancy in the corporate finance division, due to a sizeable number of transactions. We have also seen a large amount of enquiries relating to foreign direct investment, with UHY international clients making acquisitions in Ireland. This has also driven the audit side of our business. We have also enjoyed considerable growth in our outsourced payroll division.
With the greater emphasis on sustainability, cybersecurity and AI, clients expect us to be leaders in these sectors.
It is more difficult for mid-tier firms to attract staff with these specialisms, but our employees are seeking to develop their skillsets by enrolling for post qualification courses with the professional bodies. While 2022 was a difficult year for recruitment, in 2023 the employer had more choice of candidates. However, I expect that increased regulation and greater reporting will result in fewer entrants at all levels to the profession.
ENTERPRISE The SME sector is still in recovery mode after the pandemic, with some businesses finding it extremely difficult to deal with the changes of the post-Covid world. This has meant longer lead time on deliveries, more working capital requirements, and greater demands from customers. The increase in VAT, coupled with the increase in the minimum wage, has put enormous pressures on the hospitality sector.
The high levels of fixed costs in business (rent, rates, insurance, light and heat) will continue to have a negative impact on profitability across the SME sector. Government has benefited hugely from the additional VAT derived from the inflation on energy prices, and their efforts under the TBESS scheme have fallen way short of what is needed. Energy bills for all our clients have remained extraordinarily high compared with pre-Ukraine war levels.
OUTLOOK Business confidence has taken a knock with the slowdown in the economy, but it would seem that the underlying sentiment remains positive. The impact of the quick hike in interest rates had a huge impact on disposable incomes, and with inflation returning to normalised levels, we should see an easing of interest rates over the coming months. When that happens, hopefully regulators will ensure that Ireland doesn’t continue to have one of the highest mortgage interest rates in the eurozone.