The pace of technology impacting the professional operations keeps on adding and that too in different aspects. Accounting industry usually adopts the technology solutions that have been tested and approved by other industries, which are more open to experiments.
So, there are usually plenty of solutions lined up for adoption. The same is the current situation and in the coming year, it is expected that technology is going to make a serious impact in the accounting industry.
If you are an accounting professional or you run a business that has a dedicated accounting department, you should constantly keep an eye on the changes that are coming. Accounting is no more about filing taxes and preparing books. Your accounting strength speaks for the credibility of your decisions.
With the tax season 2018 almost knocking, it is a high time you picked the right tech solutions that are making it to the market and layout a progressive plan for your accounting operations.
Here are some considerations that industry experts are supporting and can help you with your business strategy.
Table of Contents
1. Save on Hardware, Spend on Software
a) Hardware Change Fast & Adopting New Hardware is Expensive
Computing hardware are totally dependent on transistors and Moore’s had predicted that number of transistors in a chip will double in almost every couple of year. The pace has led to berserk modifications in the computing hardware in the recent years.
The amount of data that was stored in a server-packed room a decade ago, can now be carried in a handheld device. Moreover, you can even carry it without a device by hosting it on cloud. The point is being dependent on the hardware is not a futuristic decision.
b) Software Update Are Usually Free of Cost
At the same time, software development is constantly aiming to deliver device-independent solutions. So, software that can perform the same operations on different devices and Operating Systems are have grown on market reputation and popularity.
Exchanging data between different application is simpler and, mostly, automated. Accounting applications, especially, the personal ones have grown immensely on this parameter, eventually enhancing the worth of hardware over software.
c) Cloud is There to Help
Cloud plays a great role in reducing dependency on hardware and getting the focus on software. With the cloud being widely accepted, there is no good reason why you should be investing heavily on the hardware.
Hosting your accounting applications on the cloud-based servers lowers your dependency on the local hardware:
- Data is stored in the cloud-based servers so you need not to purchase local servers.
- Not depending on the local server also means that you save money on the maintenance of hardware.
- Installation and processing of accounting applications take place on cloud and it does not require local installation. So, you can access the application using any device.
d) Software and Cloud Focused Strategy is a Futuristic Plan
Another important benefit of this hardware-independence is immunity from any damage to the devices. In a realistic world, our devices are vulnerable to several data loss possibilities, such as data crash, accidental damage, etc.
Reliable cloud hosting of the accounting software eliminates the possibilities of data loss not only because the data is hosted on the cloud server, but also because it is backed up on various data centers safely.
2. Artificial Intelligence to Change the Nature of Industry
a) Lots of Automation
Artificial Intelligence (AI) is making its way and causing some serious impact in the industry. With accounting industry, which is an intensely data-driven, the expected automation is among the highest ones.
A report published by McKinsey & Company in July 2016 suggests that 86% of accounting work done by bookkeepers, accountants, and auditing clerks can be automated. This automation is going to take off a load of manual accounting tasks to a significant extent.
b) Change in Accounting Jobs
Manual data entry has already shrunk considerably in the industry because of cross-application integration. With AI acting in the support of cross-application and cross-device operations, one can expect the data processing to advance further.
It is expected to bring in change with the accounting jobs as well. Accounting professionals can make run for their money by being able to make use of the technology because even with an exorbitant level of automation, expertise is going to remain in demand.
Understanding the data and making the decision based on it require a serious industry knowledge, which is going to keep the jobs available for the accounting professional even with the change in nature.
c) Fraud Detection is Going to Improve
Accounting operations rely heavily on the auditing i.e. verification of data at the various points to verify against the frauds. This implementation of automation and machine learning in mostly data-oriented industry, such as – accounting, gives a wide scope to verify the data.
It can simplify and upgrade the process of detecting/preventing fraudulent activities. It can verify the transactional entries at various points for various timestamps, check for the authentication and display the detected errors in the system.
Accounting operations heavily rest on the support of technology. So, the idea of proper accounting must be laid around adopting the right technology solutions. Adoption of the cloud solutions and AI has been backed by several industry influencers.
Most of the industry giants have already picked these solutions. Smaller units of the industry are shifting fast as well.
We would like to know what’s your strategy for the coming year and what are major changes that you would be adopting. Please mention your top considerations, challenges, and expectations for the accounting tech industry in 2018.
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Jacob5 years ago
Thank you for sharing such informative post, Nishant!
Accounting software is really playing an important part in business success. Ont the top of that hosting it on cloud provides additional ability to store unlimited data and access it on any device.
Peter5 years ago
Rightly said Nishant, one has to keep an eye on upcoming techs to stand-apart in competition.
Wondering. with the tax scams taking place, will there be any advancement in the security of accounting data?
Agnes5 years ago
With AI, accountants can get accurate data in lesser time, all due to automation!
George5 years ago
I agree with you Nishant, AI adoption in accounting industry is taking place at a faster pace. With smart recommendations and better decisions, a business saves its time, money, and bring more productivity.