Diversification of External Accountants Serving Small and Medium-sized Enterprises: Evidence from Belgium

The purpose of this study is: (1) to discover which services are offered by external accountants serving small and medium-sized enterprises (SMEs); (2) to study the factors that are associated with the degree of diversification of the services offered by these accountants; and (3) to investigate if there are differences between self-employed accountants and accounting firms on the previous two points. This study has some interesting conclusions: (1) the heterogeneity of internal staff is not significantly associated with the degree of diversification; (2) a homogeneous internal staff with an accounting background is particularly important for accounting firms that diversify their services in the accounting and tax area; (3) collaboration with other service providers is an important factor associated with more diversification of the services; (4) marketing is only important for self-employed accountants; (5) accounting firms offer fewer non-accounting-related services if they serve more micro clients (fewer than 10 employees), whereas self-employed accountants offer more accounting and tax services if they serve more micro clients (fewer than 10 employees); and (6) accounting firms that diversify in accounting and tax services mainly serve more micro clients (fewer than 10 employees), whereas accounting firms that diversify in non-accounting areas serve more larger clients (more than 10 employees).