The True Cost of Cybercrime in Australia

In today’s digital-first world, the importance of cyber security is key, especially for accountants who deal with sensitive financial information.  

In Australia, as the volume of online transactions and use of cloud applications grows, so does the threat of cyber-attacks. This is especially true for the 42% of accounting firms who are looking to grow revenue through more strategic avenues, meaning more data for criminals to access.  

For accountants, the cost of falling victim to such criminal activities goes beyond just financial losses (on average $97,000) —it can extend to long-term reputational damage and ultimately cost you clients.  

This blog post explores the impact of cybercrime on accountants in Australia and provides actionable steps into how you can protect your firm against cybercriminals.

The Financial Implications of Cybercrime for Australian Accountants 

Direct Costs 

Cyberattacks can be expensive. For accountants, direct costs include the immediate expenses related to the breach itself. These expenses often involve system restoration and data recovery, as well as ransom payments (in the case of ransomware). According to a recent study by the Australian Government, the average cost of a cyberattack for businesses, including accountants, was between $49,000 to $97,000. However, this does not consider additional costs such as legal fees, costs to upgrade systems, or staff training. Chances are the cost is much higher than what was initially reported.  

Indirect Costs 

The indirect costs of cybercrime can be even more crippling. After a security breach, accountants must often invest in much more intensive client relations, not to mention outwards facing damage control. Additionally, the potential fines for non-compliance with data protection regulations like the Notifiable Data Breaches (NDB) scheme if you do not follow government mandates. There’s also the long-term impact of lost business as clients might decide to take their business elsewhere, concerned about the security of their sensitive financial data. 

A cyberattack may not just cripple your firm in the short-term it may also do enough long-term damage that your business may be permanently affected.  

Reputational Damage: The Hidden Cost 

Beyond the numbers, the reputational damage that follows a cyberattack can haunt a firm for years. Accountants thrive on the trust of their clients, who expect not only expert financial guidance but also stringent data security, after all you own some of their most confidential data.  

A cyber breach can erode this trust overnight, leading to a loss of clients and difficulty in acquiring new business. Restoring reputation after such an incident is not only challenging but also resource intensive. 

Proactive Measures to Combat Cybercrime 

Regular Training and Awareness 

Knowledge is power. And, as we say at Practice Protect – hackers don’t hack, they trick. Your staff are the frontline defense when it comes to protecting your firm.  

Regular training sessions for all staff on the latest cybersecurity threats and best practices are crucial. Phishing scams, which often are the first step in more significant attacks, can frequently be averted by informed employees who know how to recognize suspicious emails. As part of our platform here at Practice Protect, we provide on demand security training for all staff, so you don’t need to spend thousands of specialist trainers or ask your practice manager who has no experience in this area.  

Advanced Security Software 

Investing in high-quality, updated security software is a must. This is not just limited to thinking about antivirus and anti-malware protection, firewalls, and email filters. You need to think about who has access and login information to client’s data and how you can reduce the risks if one of your staff members gets attacked. Additionally, accountants should consider tools specifically designed to secure financial transactions and client data. 

Multi-Factor Authentication (MFA) 

Implementing multi-factor authentication across all systems adds an essential layer of security. It is a core recommendation within the Australian Government Essential 8, which outlines what you should be doing to keep your practice secure. This means, even if password information is compromised, MFA can prevent unauthorized access, adding a significant hurdle for cybercriminals. 

Regular Backups 

If you are not using cloud application you need to ensure all data is backed up regularly and the backups are stored securely, preferably offsite. In the event of data loss due to a cyberattack, backups will minimize downtime and facilitate a quicker recovery. 

Staying One Step Ahead 

For accountants in Australia, the cost of cybercrime can be steep, affecting both the bottom line and the firm’s reputation. However, by adopting a proactive stance and investing in robust cybersecurity measures, accountants can not only protect themselves from the financial and reputational costs of cybercrime but also reassure their clients that their data is in safe hands. Vigilance and preparedness are the keys to maintaining the integrity and trust so crucial to the accounting profession. 

Don’t know where to start on your cyber security journey? Book a demo with one our Cyber Security Consultants who can help.