3 Technologies that Transform Accounting in the Fast-Changing Business Environment
Technologies that Transform Accounting
Technological advancements penetrate into most professions and bring monumental changes as they come along. Accounting is no exception. Most of the rote-based manual accounting chores are undertaken by non-human support. Technology and accounting are no longer different arenas, they have become one a long time ago. There is a constant evolution and so you have to ensure that you are on top of the latest developments to run along with your competitors.
There are three pivotal core technologies that have a drastic impact on accounting – the cloud, automation, and artificial intelligence.
Let us have a deeper look at each technology and see how to optimize the impact of these technologies on accounting in the changing business climate.
Table of Contents
A technology that is pivotal in today’s accounting trend is the cloud. Instead of storing your data and application in a single computer or a network of computers, the cloud allows you to store your data and applications on the internet. This has been the springboard for the explosion of software and mobile applications that has redefined the workflow of small businesses. Researchers affirm that more than half of the accountants worldwide have adopted cloud accounting.
Accessing an email while on the train, signing off the document while sitting in a coffee shop, issuing an invoice to a client while still onsite – all these are not possible without cloud technology. Not just with these non-accounting exercises, the cloud is an inevitable part of today’s accounting practice.
Cloud has made data sharing way easier than ever before. This is one of the key uses of the cloud for accountants. By connecting your cloud systems with your clients, you can access live data. This opens doors for accountants to move into a more advisory role, where the accountant can share his/her expertise and experience with their clients, and make agile decisions in case of punitive financing. This would prevent cash flow issues looming at the end of the month for a client.
Accounting automation is the process of using technology to achieve results with minimal manual support. The automation process reduces the manual elements in accounting and bookkeeping as the software takes up the complex work and draws outcomes accurately and often instantly.
Automation is not new to accounting. The calculator was the most sophisticated machine during the abacus era. And then computers and accounting software gradually popped up. But now, we have everything hand-free, including bookkeeping and accounting.
In light of today’s business climate, accounting automation is not in its nascent frame. Big enterprises have been using automation for their accounting already and are marching towards artificial intelligence. And more than half of the small and medium-sized businesses and their accountants are taking up accounting automation. There are a lot of processes in accounting that can be automated. Some of the pivotal accounting automation processes that are being effectively used across the world are listed below.
Manual entry is the most irking and time-consuming exercise in bookkeeping. Not just with the time, but we also have concerns with the accuracy of the records. Manual entries have high chances for unintentional errors. This will clamp down the speed of accounting and leaves room for checking, rechecking, and reworking at the time of reconciliation and financial closings. An efficient tool for data entry automation solves all of these problems and gives you clean records.
SaasAnt Transactions is one such application that can bulk import Excel transactions into QuickBooks with just a click of a button. It can also do bulk exports and mass deletes. They have a 30-day free trial. Try using it if you are a QuickBooks user.
Automated invoicing processing is the method of using automation software to extract invoice data, communicate the invoice information to the accounting system, and process the invoice data. When used properly, invoicing automation can save you hours of invoice processing, and also you will get mess-free records.
Payment Sync Automation
Payment sync automation tools integrate your payment system with your accounting software. By doing so, every transaction that is made in your payment system is directly copied to your accounting software without any manual touch. This automation prevents your data from spillage and unauthorized access. Most importantly, you will have your books clean and fresh all the time so that you will enjoy a hassle-free reconciliation.
One such powerful payment sync automation is PayTraQer. If you are a small business owner using QuickBooks for your accounting, PayTraQer would be a worthy add-on. Try exploring it with their 30-day free trial and start automating your bookkeeping.
With payroll automation software, you can manage the complete cycle of the payroll process automatically. Payroll systems are not only for salary computation, it takes over the entire process from gathering information, processing it, disbursement and reporting.
Artificial intelligence is the ability of machines demonstrated by software that follows pre-programmed rules to think and perform complex and repetitive tasks. This thrives productivity to incredible heights and increases efficiency.
McKinsey described artificial intelligence as ‘automation on steroids’, meaning the gamut of things that can be automated to outperform what humans can perform. Artificial intelligence can scale complex technical tasks to mass-production levels. Though some people interchange the terms automation and artificial intelligence, they mean different things. Artificial intelligence is always an order of magnitude and is a more sophisticated process.
Tech experts at Techrab point out that everything from smart connected solutions to factory robotics and automation will be run with AI. This will not only help reduce human errors and mistakes, but also ensure that decisions are taken faster and in a much more efficient manner. One of the best ways AI is expected to contribute is to build scalability in mass production.
Machine learning involves the process of making computers discover how they can perform tasks without being explicitly programmed to do so. In the world of finance and accounting, the most eminent technology that is coming to the fore is machine learning. Automated systems are usually rules-based, programmed to perform repetitive tasks. But there is a new technology that is being in the trend that could replicate human behavior, learn from the inputs, and make decisions independently. Machine learning is at its peak of evolution and is widely implemented in accounting organizations to dynamically steer their productivity.
Machine learning is not new to us. It exists with us in our day-to-day affairs. Let us talk about Gmail for instance. If you are sending mail to Fred on a daily basis, when you start a new email and type Fred, Gmail auto-fills Fred’s email address, without confusing with the email addresses of other Freds working in your office. Gmail reaches this conclusion with simple statistical analysis.
But machine learning that we use for our accounting will truly aim to learn from the information that you provide rather than basing outcomes purely on statistical livelihood.
In accounting, bank reconciliations are being automated with machine learning. The software learns from your previous allocations and account choices and makes recommendations for bank transactions. AI accounting software learns invoice coding behaviors and suggests where the transactions could be allocated. Banks use artificial intelligence chatbots to help customers resolve both common and personalized queries.
The Bottom Line
We have come to an era where automation is a necessity. Many business owners are aware of these prevailing technologies, but most of them are not prepared to invest in them. The role of an accountant is to educate your clients on the possibilities these new technologies can bring to their business. In today’s time, everyone is striving to be on top, you cannot take the risk of losing time and effort to ace in this competitive world.
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