Innovative accounting technology continues to improve the workflow and operations for businesses around the world. With the rise of artificial intelligence, automation, cloud computing, mobile applications, increased integration, blockchain technology and more, accountants are having to complete less manual work, which is freeing up time for better analysis and insights as well as increasing data accuracy. These changes are continuing to propel accounting departments to work in strategic and advisory roles, rather than solely having to focus on bookkeeping and transactional updates.
As 2019 takes shape, many trends within accounting are helping to shift the landscape and offer optimised communication and processing throughout organisations. These trends are assisting leaders to better understand the health of their business and project more accurate forecasts for the future.
Let’s take a look at some of the technology trends benefitting accounting departments in small and big businesses alike:
Companies rely on a variety of tools to function properly. Accounting technology tools are offering better integration and options than ever before to work with your current software and tool stack.
They link ERP (Enterprise Resource Planning), CRM (Customer Relationship Management) and CMS (Content Management System) so that there is one unified environment for people across departments to access the information they need anywhere and anytime.
Along with better software integration, accounting tools are using OCR software, or Optical Character Recognition, to scan invoices, images and receipts to update financial data without requiring manual entry. Such software helps to reduce manual human data entry errors and streamline processes, thereby saving time and money.
With the use of automation like Robotic Process Automation (RPA), humans can train robots to mirror their steps to replace tedious human tasks like data entry. RPA offers financial and operational benefits that reduce cycle times, labour costs, report processing and manual error. Rather than having to replace current IT infrastructure, RPA works across what already exists within an organisation to provide nonstop performance.
For example, instead of needing an employee manually upload invoices for an accounts payable department, RPA can be taught the steps and then take over the task. And, this small change could reap significant monetary benefits. It’s estimated that accounts payable automation will save businesses at least $16 per invoice.
It’s one thing to have an immense amount of data, but it’s another to have data that can provide valuable insights to maximise business processes and identify business successes and risks.
Beyond just purchase history, dates, products and times, emerging technologies are offering increased data analytics and tracking more than just surface level information. For example, some software may include weather patterns and even a customer’s response regarding a product feature so, in turn, businesses are able to predict trends better and understand the flow of business and product cycles.
With real-time data, accounting departments can visualise trends much more clearly and quickly than ever before to account for profit and losses ahead of time proactively. It is information and technology like this that allows accounting departments to serve in advisory roles and offer strategic insight to business leaders, especially when it comes to decision-making.
Accounting Today predicts that by 2026, the global accounting software market will be valued at $11.8 billion. With cloud-based accounting software, departments have platform independence, can access information remotely, and can save up to 30% on IT costs. It also frees up the time that was once used to run data backups.
While some people have been fearful over the security of cloud services, it’s safer than traditional servers and data storage methods because it mitigates the risk of hardware damage or theft risk. With data encryption and transmission, the physical devices where cloud data is stored is typically safer than having servers stored in a single location within businesses.
Additionally, cloud accounting software allows for better consolidation of data from different data platforms and real-time communication between departments and consulting services to keep all stakeholders in-the-know, reduce communication bottlenecks, and communicate any changes in real-time.
Accounting currently and historically uses a double entry system, such that auditors are required to check the books to ensure the accuracy of information. This is both a timely and costly process.
On the other hand, by using blockchain technology, accounting departments can create an interlocking system of records that is distributed and inherently audited by digital technology.
The technology of blockchain relies on independent and distributed ledgers that maximise data verification and trust. For a transaction to occur through blockchain, all of the computers must simultaneously agree to edit the data and add a new “block” to the chain, such that all computers will maintain identical records.
The most popular accounting software tools are taking into consideration the increased mobile usage. Like websites, accounting technology tools are being designed mobile-first. This means that the mobile user experience is a priority as so many businesses rely on being connected around the clock through mobile devices.
Mobile responsive tools mean having access to data, reporting and analytics on-the-go. It also means that employees can record expenses and payments as they happen which makes items like expense reports and data entry more efficiently handled. There no longer has to be the lag time between transactions and reporting. Senior management can then review those changes instantly on the move, through real-time notifications increasing oversight and reducing risk.
Although technology is taking a front seat in accounting departments and is imperative to implement to stay ahead of the curve, accounting trends show that humans will not be replaced by robots. Instead, automation and artificial intelligence are helping to augment and better serve their human counterparts by reducing manual work and empowering the human mind with better information to make informed decisions. Accountants are shifting their place within organisations to better serve as strategists and consultants rather than bookkeepers.
Computers will continue to increase their capabilities and transactional powers which will impact trends in accounting and accounting technology trends.
Accounting technology is expediting accounting teams’ work around the world. Cloud technology, the internet and automation are affecting all industries, and when it comes to accounting, it has already proven to benefit firms that leverage such tools more than traditional firms that remain outdated. When accounting firms use cloud technology and can have information synced in real-time across departments, they can act with more agility and make better decisions on the fly.
These accounting technology trends are helping to better serve customers and also provide customers with a stronger sense of security in knowing that information is backed up by data. In turn, firms can better attract and retain clientele who can rest assured knowing that their business is being taken care of at all times. The trend of automation is also increasing employee retention as it removes boring and manual data entry work from the job description of accountants so they can focus on high-level and value-added tasks instead of repetitive actions.
The various accounting technology trends are all beneficial to firms, but accounting automation tools take the cake in terms of how they are benefitting accountants. The use of robotic process automation (RPA) to handle back office tasks like invoicing, customer registration and more, is speeding up accounting teams’ jobs. From procurement to accounts payable and accounting close processing to expense management, accounting automation is handling so many everyday tasks that were once considered to be cumbersome and tedious.
With accounting automation, companies are not only speeding up their workflows, but they are also reducing compliance risk and limiting the occurrence of human error from data entry and the copy pasting of data from one source to another. As mentioned above, these trends are not intended to replace humans, but rather they are used to shift what an employee spends their time on. Gone are the days that humans are needed for repetitive work that doesn’t require much brainpower. Machines can handle these tasks while humans work on high level, high value and rewarding job duties within accounting teams and across organisations.
The evolution of accounting technology has happened for many reasons, but two of the most significant factors have been innovation and client or internal business demands. Since more data is readily available, customers and businesses are requiring more from their accounting teams, which is why these tools can play such a significant role in providing better business practices. These technologies are not intended to replace human resources. Instead, they help to augment and enhance the work being done within accounting departments to better support business as a whole.
By staying up-to-date on accounting technology trends, your business can improve analysis and insights to reduce costs, increase efficiency and increase financial reporting accuracy by leveraging innovative software tools.