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Accountants have long been essential to the success and functionality of businesses. The role of an accountant, however, is by no means a static one. New financial and social realities breed new accounting paradigms. This article is a brief guide to some of the most important recent and ongoing developments in the world of accounting. Many of these developments have been provoked by the emergence of new technologies like Artificial Intelligence and cloud computing.
Software is increasingly being used to automate tedious tasks in the world of accounting. Tedium, however, does not equal unimportance. Many of the most significant tasks carried out by accountants are relatively tedious in nature – including the accounting of financial records and other large data sets. Here is how automation is shaping accountancy today.
There is some confusion in society as a whole as to the correct definition of Artificial Intelligence. Most AI scientists working today deploy rather broad definitions of the field. Most of these understandings centre around the meaning of ‘intelligence’ itself. In practical terms, a program or machine that can be considered an Artificial Intelligence needs to be able to learn and make decisions using data from the world around it. It needs to emulate or improve upon the kind of reasoning that human beings display. It needs to be able to improve over time.
Artificial Intelligence is having a big impact on the automation of accounting tasks. Artificially Intelligent software can, for instance, scan documents for useful data and code that information into a dataset. This means that accountants do not have to sift through documents to find data to codify. Instead, they can spend their time analyzing the datasets that are collected by Artificial Intelligence. This means that top-level accountants can spend more of their time and expertise on impactful work, rather than the gathering of data.
Modern business is more reliant upon data analytics than ever before. We live in the age of the data deluge – our highly networked society generates vast quantities of useful data. So-called ‘Big Data’ is, by definition, comprised of datasets that are too big to manually analyze. The automation of some data analysis has allowed for larger and larger datasets to become useful for companies. Intelligent accounting software is able to develop and visualize very accurate forecasts based on more data than a human being could ever codify.
Increased automation of accounting tasks combined with the ever-increasing importance of data within business strategy has led to accountants having an increasingly strategic role within businesses.
The development of strategy at a corporate level involves the analysis of data, the creation of forecasts and the use of these forecasts to plot long term objectives. Accountants, who typically have a highly developed familiarity with data, are well suited to informing strategy in the modern corporate environment. The role of management accountant has grown ever more important. Management accountants have strong data science and financial backgrounds while also being familiar with strategic planning and the balance of risk. Management accountants are very useful for companies that want to assess the ongoing successes and failures of their strategic plans. Collecting and accounting for data is, after all, the accountant’s bread and butter.
Remote Working and Collaboration
The global shift to remote working during the COVID-19 pandemic will not have passed you by. The conditions under which we have all ended up working from home are unlikely to disappear overnight. They will have left a permanent mark on the ways in which business is conducted well into the future. This might also be a great opportunity to incorporate a PEO to handle payroll and taxes for all your hybrid employees.
The world of accounting has adapted to this new normality. Online collaboration and cloud-based data access are now integral in the field. Accountants are expected to run the software and communicate with clients and business partners online. For large projects, project management software is essential. It allows a project manager – in some cases an accountant – to effectively collaborate remotely and share progress with a team.
Some of the largest accounting firms have fully embraced the remote working paradigm. Accounting giant PwC in the United States has given all staff the opportunity never to return to the office – instead offering them access to powerful cloud-based services so that they can do their jobs from home.
Although data security has always been paramount for accountants that want to keep the sensitive numerical data they deal with safe, it has become an even more prescient issue in the heavily networked world of the 2020s. Data security breaches cost companies millions of dollars each year and compromise countless consumers’ and workers’ privacy.
Finance and accounting departments are one of the most popular targets for hackers. This is due to the potential value of the data that can be mined from them. Accountants now have the responsibility for noticing and reporting any kind of data security anomaly that they see. Any change in a service they use can be evidence that security has been compromised.
Continuous accounting is a relatively recent concept that makes use of new technologies to offer a far more comprehensive corporate accounting structure. It operates using three principles:
Monotonous tasks should be automated using intelligent software. This is to ensure data integrity and allow continuous monitoring.
The accounting calendar needs to be torn up. Instead of conducting accounting reviews at monthly or yearly intervals, accounting review must be a continuous process that is distributed throughout the year.
Due to this continuous work, processes can be assessed and improved without the need for time-consuming bureaucratic delays. Processes need to be continuously and exponentially improved.
Company Benefits and Workplace Wellness
Companies are increasingly offering their staff complex packages of health and wellbeing benefits. This is all well and good, but it adds a great deal of work onto the desks of hard-working accountants. Health and wellbeing packages need to be factored into a company’s expenditures and balanced with other savings.