Candidate Testing & Assessment in Accounting Recruitment - Firm Focus Webinar

11th February 2015

Use of Candidate Testing & Assessment in Accounting Recruitment

• Practical guide to managing risk & identifying potential in the

recruitment & selection of accounting & bookkeeping staff

• Focus on filling in the gaps left by traditional interviews & reference checks

• Introduction to candidate testing & assessment

• Ability & Personality Assessments (psychometric testing)

• Assessment Centre Exercises

• Skills & Knowledge Tests

• Accountests Accounting & Bookkeeping Specific Tests

• Revenue Generation for CA & Professional Services Firms

• Introduction & brief background of presenters

• Steve Evans, Director of Accountests & People Central Ltd

• Giles Pearson, CA Firm Partner & Technical Advisor

Recruitment & Selection Best PracticeWhy bother?

• The average cost of recovering from a bad accountant hire is $125,000*, and for a Bookkeeper $108,000*. That's an expensive mistake, and an avoidable mistake when a $200 solution was at your fingertips.

• *The Chartered Institute of Personnel & Development (CIPD) place the cost of recovering a bad hire at 143% of the annual salary of the job. In the Robert Half 2014 Accounting & Finance Salary Guide, the Median Accountant Salary is $88,000 and the Median Bookkeeper Salary $75,000

Overview of Recruitment & Selection Best Practice using Traditional Selection

Methods

• Adding candidate testing & assessment to your selection process

is meaningless unless you have the basics right

• Shortlisting Processes

• Is there a Position Description/Person Spec to guide shortlisting?

• If so, are they up to date; or screening on what the job will become?

• Interview Process

• Interviews – How are they conducted?

• Who are they conducted by?

• Are they trained/effective/using their skills often enough

• Are they ad-hoc or structured, competency/behavioural based?

• Reference Checks

• Are they ad-hoc or structured, competency/behavioural based?

• Refer to Elephant HR Webinar in the CCH Library

0.00 0.20 0.40 0.60

Blending Assessments of Skills, Ability & Personality

Work sample tests

Ability tests

Structured interviews

Personality questionnaires

Assessment centres

Biodata – CV’s & Supporting Info

References

Unstructured interviews

Years of job experience

Interests

Years of education

Graphology

Predictive Validity of Selection Measures and Job Performance

Robinson & Smith 2001

Beyond Interviews & Reference Checking – An Introduction to Candidate

Testing & Assessment

• Addressing what Interviews tend to leave uncovered

• Psychometric Testing & Assessment– Tests of Ability

– Assessments of Personality

• Assessment Centre Exercises– Little used in NZ but widespread in EU/US

– Simulated work environments & validated exercises

– Eg: CFO Intray Exercise, Business Analysis of Acquisition

– Available through People Central Ltd. See this link

• Skills & Knowledge Testing– Job & Role Specific – includes Accountests

– Software/IT Specific – eg: ms-excel or MYOB

Ability Testing

• Tests of Ability• Hard objective measures of core abilities essential to the job• Reliable & Valid with Strong Predictive Validity Correlations• Pitched at the job• Increasingly available online

• Examples– Examples of Ability Tests for Bookkeepers – Clerical Test Battery (CTB2)– Examples of Ability Tests for Graduates & Chartered Accountants (CRTB2)

• Pitfalls• Garbage tests in NZ’s unregulated marketplace• Buyers Guide to Avoiding Pitfalls at this link• Requirement for qualified administrators & supervision for some tests• Consistency & Employment Law

– Solution • Contact us for assistance in identifying tests suited to the role & how to access them

Personality Profiling, Assessments& Reports

• Typically Cover• Most employers hire on ability & fire on personality• Softer measures of a candidates preferences in traits associated with success or poor

performance in the job• Lesser but still significant Predictive Validity Correlations• Provide Interview Questions for Candidates & Referees• Include Personal & Professional Development Plans to get new recruits up to speed• Focus on Interacting with Others, Change, Problem Solving & Decision Making,

Leadership & Subordinate Styles, Influencing Styles & Stress Tolerance • Widely available online

• Pitfalls• NZ’s unregulated marketplace is awash with junk personality ‘tests’ with zero predictive

validity• Buyers Guide to Avoiding Pitfalls at this link• Requirement for qualified administrators & supervision for some tests• Consistency & Employment Law

– Solution • Contact us for assistance in identifying tests suited to the role & how to access them

Work Skills & Knowledge Tests

• What they do• Hard objective measures of actual skills & knowledge essential to the job

• Very Strong Predictive Validity Correlations

• Available online

• Simulated Software Tests require candidates to demonstrate their skills rather than talk about them at interview

• Easily Interpreted by In-House Hiring Managers & Accountants

• Examples• Microsoft Office Suite or just Excel/other singular software

• Some Accounting Packages (MYOB, QuickBooks)

• Alpha/Numeric Data Entry Speed & Accuracy Tests

• Accountests Suite of NZ Accounting Tests for

• Chartered Accountants

• Part Qualified/Qualified by Experience Accountants

• Bookkeepers

Accountests

• Why we developed Accounting Skills Tests

• Client firms complaining of recruiting people with seemingly high credentials, only to find the reality was poor recoveries on jobs, requirements for extended supervision by other accountants and quality issues

• Issues arising post-recruitment included:

• Reduced Staff Retention & Morale

• Reduced Recoveries & Profitability for CA Firms

• Gaps in expectation & Reality of Capability & Quality of Output of New Recruits

• Reputation of Firms & Hiring Managers

• Existing accounting skills tests were 20yrs out of date, not country specific (NZ/AUS?) & had too many ‘filler questions’ of numerical calculations/reasoning

• Led to the decision to build NZ specific tests for

• Chartered Accountants

• Part Qualified & Qualified by Experience Accountants

• Bookkeepers

Accountests – Adding Value by:

• Identify technically competent candidates and eliminate high risk candidates

• Making timely, informed and cost-effective selection decisions

• Identifying training and development priorities to target in getting new recruits up to speed

• Making informed salary offers based on current accounting skills & knowledge

• Compare your candidate performance against norm-groups of other accountants

• Instant access and test report generation. Have your report within an hour

• Using tests which are validated, reliable, country specific and updated annually by accounting experts

Using Accountests Reports in Recruitment Decision Making

Testing & Assessment is all about walking into new employment relationships withyour eyes open & rejecting high risks before they sign an employment agreement

• Is this a skilled & knowledgeable accountant or bookkeeper?

• If so, should I fast-track their application before a competitor snaps them up?

• Is this a candidate a low scoring risk to our business?

• Should we waste time progressing their application or concentrate on stronger candidates?

• Does this candidate have a blend of strengths & shortfalls?

• Are the shortfalls ‘trainable’ in reasonable time?

• Should we appoint & concentrate training & development where it’s most needed?

• Consider in combination with other recruitment information

Logistics & Investment

• Where in the selection process to use testing?– Traditionally testing & assessment is reserved for the final few candidates– Accountests aims to be cost effective enough to assess candidates further up the

screening process – don’t miss out on potential high performers– Most clients testing between first & final interview

• Ease of Access– Purchased online as & when required– Links received on purchase– Tests timed at 30 minutes– Reports generated & sent on completion– Easily interpreted by hiring managers & accountants– Informed decisions made swiftly

• Investment– As & when tests $200 for Accountant Tests & $150 for Bookkeeper– 20% Discounts for CCH Members– Options for further volume discounts of up to 50%

Choosing Testing & Assessment ToolsChartered Accountant Case Study

Position Description/Person Spec Candidate Assessment Tool

Strong Analytical Skills Critical Reasoning Test Suite (Numerical, Verbal & Abstract)

Strong Skills & Experience of varied CA & BAS work in a busy CA Firm

Accountests CA Test

Client/Customer FocusAble to Build Relationships into Increased RevenuesConscientious with High Personal Standards of ProfessionalismTeam Working

Personality Questionnaire & Profile Report

Choosing Testing & Assessment ToolsBookkeeper Case Study

Position Description/Person Spec Candidate Assessment Tool

At least 3 years experience as a bookkeeper carrying out a full range of bookkeeping & finance assistant activities

Accountests Bookkeeper Test

Intermediate MS-Excel skills & knowledge, ideally in ms-excel 2010

Microsoft Excel 2010 Skills Test

Accountests as a Revenue Generation Tool for CA & Professional Services Firms

• Constriction caused by cloud accounting to traditional revenue streams

• Firms offering general business advice, including support in recruitment & selection to clients

• Getting staff trained in effective interviewing, shortlisting & selection techniques to support clients in all of their recruitment

• Arranging testing for clients hiring bookkeepers/accountants & providing additional support in interpreting results, offering mentoring & training to their new recruits

• Double Benefits from:

• Revenue generated from testing candidates, assisting with recruitment & training

• The quality of your clients accounting & financial reporting is lifted, you get better information and better recoveries

Offer to CCH Members & Webinar Guests

• All Accountests products are discounted to CCH members by 20%

• The updated version of our website will have a CCH members promotion to access & receive member discounts from March 2015

• In the meantime, purchase a trial test & we refund you 20% in the same business day

• All webinar guests & CCH members have access to free advice on general testing & assessment by calling Steve Evans on 0800 896 325 or steve@accountests.com

• Look out for:

• Individual Cost, Management & Financial Accounting Tests to be launched this year

• Australian & UK specific tests also launched this year

Thanks for Listening & Keep in Touch

• If you want to keep up to date with trends and best practice in recruitment and selection of accountants in New Zealand do join our Linked-In Group at this link.

• We also run bi-monthly newsletters on best practice in recruitment & selection which you can sign up for at the foot of our homepages for both Accountests & People Central

• Always on hand to answer queries on making thoroughly informed selection decisions & avoiding pitfalls of poor tests/assessments

• Wishing you all a successful 2015 & beyond!