The accounting profession is undergoing rapid changes driven by advancements in technology and market forces. These trends are shaping the accounting industry as we know it today. Let's explore the nine key trends that are driving these changes:
What are the Key Trends Shaping the Future of Accounting Profession?
Technology and Automation
Automation of repetitive accounting tasks is becoming more prevalent, including approval workflows, bank reconciliation, journal entries, revenue recognition, and more. While there is a lack of understanding and resources to implement these technologies, companies that have automated their accounting functions are reporting substantial ROI.
Role of Artificial Intelligence (AI)
AI and robotic process automation (RPA) are being used to automate mundane and repeatable tasks, allowing accountants to focus on higher-value activities. For example, accounting firm EY has used AI to analyze lease contracts, making it easier to capture critical information and enabling finance professionals to make more informed decisions.
Accounting Software
Cloud-based accounting solutions are gaining popularity, with 36% of companies planning to implement them in the near future. Integrated systems are consolidating financial data with other areas of the business, providing actionable insights for decision-making.
Data Analytics and Forecasting Tools
Increasing use of budgeting, forecasting, and planning software, as well as data analytics and visualization tools, is making finance functions more analytical and proactive. Professional certifications like the Data Analytics & Visualization Fundamentals Certificate by IMA are equipping accounting and finance professionals with the necessary skills for business strategy advancement.
Digital Transformation
Organizations are rapidly transforming their business models with the aid of digital technology, and accounting and finance teams are at the forefront of these changes. They are adapting to new revenue models, product offerings, and channels, and leveraging technology to support business strategy and adapt to changing conditions.
Workplace Wellness
Workplace wellness programs are a popular perk provided by employers, but managing them can be complex for accountants. They need to ensure that the tax implications of wellness program benefits are accurately calculated and accounted for. These programs can also be used as a tool for employee engagement and addressing burnout and stress among accountants.
Online Collaboration and Remote Workforce
Cloud-based software and collaboration tools like Zoom are enabling remote teams to collaborate on critical financial processes, such as month-end close, from anywhere with an internet connection. These tools are becoming essential for facilitating remote work in the accounting profession.
Evolution of the Accountant Role
As automation takes over transactional work, accountants are shifting towards more strategic roles as leaders and decision-makers. Soft skills like emotional intelligence, leadership, and data analysis are becoming crucial for successful careers in the future accounting profession.
Data Security
Data breaches are a significant risk for finance departments, and ensuring data security is becoming a top priority. Accountants need to be vigilant in safeguarding financial data and implementing robust security measures to protect against cyber threats.
Proactive Accounting
The way accounting is approached is being reframed with the help of machine learning and RPA. Continuous accounting is the practice of integrating duties that are typically completed at the conclusion of a period into regular day-to-day activity. However, the advantage of continuous accounting goes beyond giving your accounting team fewer late nights.
You may increase productivity and data integrity by automating repetitive activities, which frees up time for your accounting staff because mistakes can be a regular source of time-consuming labor. By keeping an eye out for process efficiency, your team can then concentrate on fostering a culture of continuous improvement.
Outsourcing
It may be advantageous for businesses of all sizes to outsource part or all of their accounting and finance operations. Smaller businesses outsource accounting to avoid adding staff. Larger companies may choose to outsource all or part of their accounts payable function; this is typically done to save costs. In certain cases, outsourcing might provide you access to technologies, skill sets, and knowledge that your business could not readily or economically replicate by adding new employees and investing in its own infrastructure.
Impact of Accounting Trends on Virtual Bookkeepers and Client Relationships
As a virtual bookkeeper, your relationship with your clients can be significantly impacted by various accounting trends. Let's explore a few potential impacts:
Automation
Automation is a growing trend in the Accounting Profession, with the use of accounting software and cloud-based solutions becoming more prevalent. As a virtual bookkeeper, you may rely heavily on accounting software to automate repetitive tasks such as data entry, reconciliations, and financial reporting. This can streamline your workflow and improve accuracy, allowing you to deliver more efficient and cost-effective services to your clients. However, it may also lead to reduced client interactions, as the need for manual data input and review decreases.
Real-time Reporting
Real-time reporting is becoming increasingly popular in the accounting world, allowing businesses to access up-to-date financial information at any time. This trend can impact your relationship with clients as they may have higher expectations for timely and accurate financial reporting. As a virtual bookkeeper, you may need to adapt your processes to provide real-time reporting, which may require more frequent communication and collaboration with your clients to ensure data accuracy and relevancy.
Data Security
Data security is a critical concern in today's digital world. As a virtual bookkeeper, you may store and process sensitive financial data on behalf of your clients. The trend towards increased data security and privacy regulations, such as the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), may impact how you handle and store client data. You may need to implement additional security measures, such as encryption, two-factor authentication, and regular data backups, to protect client information and comply with relevant regulations. Ensuring compliance with data security regulations can help build trust with your clients and maintain a positive relationship.
Advisory Services
Many virtual bookkeepers are increasingly offering advisory services to their clients beyond traditional bookkeeping tasks. This trend involves providing strategic financial guidance, forecasting, and analysis to help businesses make informed decisions. Offering advisory services can deepen your client relationships, as you become a trusted financial advisor. It may require additional skills and expertise, such as financial analysis and business acumen, to effectively deliver these services and provide value to your clients.
Bookkeeping Pro Services Professionals undergo extensive training mechanisms to stay up to date and provide the best possible solution to the business. We have a cross-functional team of experienced professional and tech-savvy young enthusiasts going the extra mile to keep your books up to date and help you make informed decisions and stay ahead of competitors.
Useful Resources
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