What Every Firm Should Know About Accounting Assessment Tests

The stakes are very high when it comes to hiring bookkeepers or accountants. Do you know what the most critical step for your firm’s long-term financial health and success? ?

Choosing the right candidate.?Now how do you do that??

Streamline your hiring process by using specific accounting assessments. Even though you may rely solely on resumes, interviews, and references, adding this step is important to determine which candidates to interview or even assess them to finalize a decision on who to hire!?

Entigrity is the accounting industry's top global talent solutions provider. Over 3000+ accounting professionals have been hired, developed, and managed by Entigrity in more than 30 offices worldwide. Our extensive experience makes us aware of the value of assessment tests in the recruiting process and how they can help firms reach their greatest potential by ensuring candidates know how to calculate operating income.?

Understanding Accounting Assessment Tests?

Accounting assessment tests are essential tools used to evaluate an individual’s proficiency in accounting principles, concepts, and practices. These tests are commonly employed by employers to gauge the technical knowledge of candidates applying for accounting or finance positions. Educational institutions also use these tests to determine whether students need to take prerequisite accounting courses.?

Typically, accounting assessment tests cover a broad range of topics. These include financial statements, which are crucial for understanding a firm’s financial health, and accounts receivable and accounts payable, which are vital for managing cash flows. The tests also delve into generally accepted accounting principles (GAAP), retained earnings, and various financial transactions. Additionally, candidates may be tested on their understanding of the balance sheet and other fundamental accounting concepts.?

By assessing these areas, accounting assessment tests provide a comprehensive evaluation of a candidate’s ability to handle the financial responsibilities of a role, ensuring that only the most qualified individuals are selected.?

Why Should Your Firm Use Pre-Hire Assessments??

Going through the Manpower Group Survey, it has been revealed that the industry skills shortage is at a 16-year high in the current scenario, and hiring for accounting positions takes an average of four months. Understanding and managing current liabilities is a key aspect of effective financial decision-making, making it crucial to evaluate candidates' skills in this area. Choosing the correct candidate the first time around is more crucial than ever because the stakes are so high. Pre-hire assessments can help you accomplish this in many ways.?

1. Identifying the Best-Fit Candidates: Assessment tests let you assess a candidate's abilities, knowledge, and skills beyond what they've mentioned on their CV/Resumes and during the interview. This makes it more likely that the person you hire will be capable of taking on the job right away.???
2. Ensuring a Fair and Unbiased Process: You can eliminate hidden biases from the recruitment procedure and provide each applicant with an equal chance to showcase their skills by utilizing standardized evaluation exams.?
3. Reducing the Risk of Bad Hires: Poor recruiting decisions can be costly in terms of money spent and the effect they have on the output of your team. Do you know the cost of a bad hire is surprisingly high! ?According to the SHRM (Society for Human Resource Management), the per-hire recruiting cost is $4,700. But if you are thinking that this is the only cost, then you are wrong here. Some projections estimate the full cost of a new hire is around three to four times their annual salary. In simple terms, if you hire someone for the salary of $60,000, the cost associated with this will be around $180,000 to $240,000.?Pre-hire evaluations lower the possibility of costly hiring errors by assisting you in making better-informed judgments.?
4. Enhancing Your Employer Brand: Including evaluation exams in the recruiting process communicates to prospects your firm's dedication to selecting the best individuals and supporting their success. This can enhance your overall recruitment efforts and assist in drawing in top personnel.
5. Accelerating Time-to-Hire: Assessment tests can expedite your hiring process and assist you in filling crucial roles more effectively by rapidly finding the most qualified candidates.?

?Importance of Accounting Skills

Accounting skills are the backbone of any successful business or organization. Accurate financial reporting, budgeting, and forecasting are indispensable for making informed business decisions. Employers seek individuals with robust accounting skills to manage their financial transactions, prepare financial statements, and ensure compliance with regulatory requirements.?

These skills are not only crucial for day-to-day operations but also for strategic planning and long-term financial health. For individuals aspiring to build a career in finance, strong accounting skills provide a solid foundation for advanced financial analysis and decision-making. Mastery of financial statements and the ability to manage financial transactions effectively are key competencies that can significantly impact an organization’s success.?

In essence, accounting skills are vital for maintaining financial integrity and achieving firm’s core objectives, making them highly valued in the job market.?

Types of Accounting Assessment Tests?

TestGorilla, JobAdder, and others, candidates' test scores are automatically graded and ranked, guaranteeing an impartial and objective assessment. Additionally, these systems offer insightful data that will assist you in making better recruiting decisions.??

• Outsourced Accounting Talent: Due to a lack of eligible candidates, a growing number of firms are entrusting the full hiring process to outsourced accounting talent providers like Entigrity. These services find and screen top accounting specialists on your behalf using tried-and-true methods, such as cutting-edge evaluation tools. You can access a pool of elite talent that has been carefully screened and matched to your unique requirements by outsourcing this service.??
• Self-Applied Accounting Tests: You can create and administer your own accounting assessment tests if you're more of a hands-on learner or don't have the resources to purchase pre-employment testing software. This enables you to customize the exams to the needs and job descriptions of your firm. To preserve fairness and objectivity, it is crucial to guarantee that the exams are legitimate, well-designed, and regularly administered. Including questions that assess understanding of cash flow from operating activities can provide insights into a candidate's ability to manage financial health.?

Whatever approach you decide on, the most important thing is to pick assessment tools that correspond with the abilities, know-how, and proficiencies needed for the position you're attempting to fill. This will assist you in determining which applicants are the most suitable for your firm.?

The Benefits of Accounting Assessment Tests

The following are some benefits that you can get by adding accounting assessment tests to your hiring procedure and which will help your firm succeed in the long run:?

1. Improved Hiring Accuracy: Assessment tests offer a more thorough and objective assessment of a candidate's skills, lowering the possibility of hiring the wrong person and the costs that go along with it.?
2. Enhanced Employee Onboarding and Training: You can develop more specialized onboarding and development programs by using the information from assessment tests to pinpoint areas where new hires might require extra assistance or training.?
3. Increased Workforce Productivity: You may create a high-performing workforce that is better suited to contribute to the general productivity and profitability of your firm by hiring individuals who possess the required talents and fit with your culture.?
4. Stronger Employer Brand: You may become known as an employer of choice and draw and hold onto top talent by showcasing your dedication to using assessment tests to identify the best-fit individuals.?
5. Reduced Turnover: You're more likely to find candidates who are driven to advance with the firm and who are well-suited for the position if you make the appropriate hiring decisions the first time around.???

Final Thoughts and Conclusion?

Hiring the proper people is critical in the accounting industry, which is highly competitive and skill scarcity occuring. Pre-hire assessment tests help you make better, data-driven hiring decisions and position your firm for long-term success. Consider implementing them into your hiring process.?

The secret is to identify the talent acquisition strategy that best suits your firm's requirements and objectives, whether that strategy involves using pre-employment testing software, outsourcing, or developing your own unique tests. By investing the necessary time to assess applicants' abilities, expertise, and cultural fit, you can put together a productive team that will propel your firm ahead.???

At Entigrity, we're committed to assisting firms just like yours in finding the best individuals to meet their goals. Connect with us today to learn more about optimizing your recruitment and hiring strategies through the power of accounting assessment tests.???

FAQs???

Q: How do accounting assessment tests differ from traditional interviews and resume reviews??

Ans: A candidate's skills, knowledge, and talents are evaluated more thoroughly and objectively by accounting assessment tests, which go beyond a candidate's resume and interview performance. Assessment tests provide you with a deeper idea of how a candidate would truly perform on the job, even though resume checks and interviews are still valuable sources of information.??

Q: Can assessment tests really identify the "best-fit" candidates??

Ans:?Yes, accounting assessment tests can assist you in determining which applicants best fit the unique requirements of your firm when they are correctly created and implemented. You may make better hiring judgments by assessing technical proficiency, problem-solving skills, emotional intelligence, and other critical capabilities.??

Q: How long does it take to administer accounting assessment tests??

Ans: The length of time needed can change based on the kind of test and how difficult the assessment is. Multiple-choice exams and aptitude tests typically last 30 to 60 minutes, although more thorough evaluations like case studies or role-playing exercises might take one to two hours. With automated scoring and reporting, pre-employment testing software frequently streamlines the process.?

Q: Do assessment tests replace the need for interviews??

Ans: No, evaluation tests ought to be utilized in addition to conventional hiring procedures like interviews, not as a substitute for them. Even while the tests yield insightful and useful information, interviews are still the most important way to determine whether a candidate will mesh well with your firm's culture and how well they will communicate with others.??

Q: How can I ensure assessment tests are fair and unbiased??

Ans: It's critical to use verified assessment tools, provide explicit scoring guidelines, and provide your hiring team with best practices for administering and grading the tests to preserve objectivity and fairness. A bias-free assessment can also be ensured by partnering with a firm like Entigrity to handle the assessment procedure.?