Well, 2020 is over an out and in my opinion good riddance! So, what lies ahead for the accounting profession in 2021?
As we battle with COVID-19 and its lingering effects, let’s consider a few technology and service trends that may influence how we do business moving forward. Here are my top five for 2021;
The accounting industry needs to better understand the process and benefits of blockchain technology. Blockchain is already changing the accounting industry by lowering the costs of reconciling and maintaining ledgers. It also provides the needed accuracy in terms of ownership and history of assets. With blockchain technology, accountants can gain an unhindered view of their client’s business obligations and available resources. For great information on Blockchain and its impact on a variety of industries have a look at the IBM site at: IBM Blockchain – Enterprise Blockchain Solutions & Services – Australia | IBM
Wikipedia defines business analytics as the skills, technologies, and practices for continuous iterative exploration and investigation of past business performance to gain insight and drive business planning.
As technology allows specific accounting tasks to become easier, the accounting industry needs to shift its focus to data analytics. Accountants are taking on new roles as advisors, with unique skill sets that revolve around analysing data. Analysing numbers provides valuable insights to accountants and their clients, which enables them to identify process improvements as well as increase efficiency and manage risks better.
Business Advisory Services
The increasing introduction of more dynamic technologies in the accounting industry allows accounting firms to focus on the quality of their business advisory services. Services like financial growth, profitability and cashflow enhancement and developing strategies, as well as business intelligence, are becoming better and are growing in numbers. The removal of certain manual tasks that open capacity opportunities for accounting firms to spend more time analysing data, providing insights, and giving advice to their clients.
Of course, technology is just an enabler in getting advisory services right in an accounting firm. Matched with this is the need to be committed and get the right systems, processes, and people resources in place as well as revising your current firm structure, enhancing the infrastructure of services offered and who will offer them as well as developing the right client engagement and delivery models. All challenges, however, are certainly achievable with the right and realistic business advisory implementation plan.
If your firm wants to start or enhance their advisory process, why not undertake a complimentary 45-minute digital Business Advisory Assessment with me. Just send an email to: [email protected] and I will get things organised.
Artificial Intelligence (AI)
Artificial intelligence (AI) refers to the simulation of human intelligence in machines that are programmed to think like humans and mimic their actions. The term may also be applied to any machine that exhibits traits associated with a human mind such as learning and problem-solving. – Source: Investopedia: Sharper insight, better investing.
AI is currently producing positive results in the accounting industry. It allows analysis of large volumes of data at high speed, as well as increasing productivity and generating more accurate data at a reduced cost. The importance of AI in accounting is growing more steadily as it optimises administrative tasks and accounting processes that result in various structural changes. AI can provide opportunities for accountants and a new level of efficiency for workflow management.
Just as big data plays a crucial role across many sectors, it can fill the same significant role in the accounting industry. Big data is the high volume of information that is collected daily from various sources that include social media, online services and machine-to-machine interactions. When analysed, big data can provide accountants and their clients with insights that allow the formulation of optimal strategies. With the use of big data, accountants can transform key data sets into secure and vigorous data analyses. A great article on big data and the accounting industry is at: Big Data and Its Impact on the Accounting Industry in 2020 (acecloudhosting.com)
In my opinion, the above five technology and service trends demonstrate that the accounting industry is ready to shift from its conservative reactive nature to becoming more dynamic and proactive. Accountants backed by these technologies, systems and strategies can now focus more on strategic planning, analysing processes, delivering services really wanted by clients and perhaps even helping clients see the financial impact of key business decisions before they happen!