Trends in Accounting: Disruptive Technology Provides New Potential for Accounting Teams
As companies rapidly progress through busy season and the year-end close, many accounting professionals are planning to put what they’ve learned over the course of the last year into action.
Given the reflective nature brought on by end-of-decade discussions, the time is ripe for companies to embrace the opportunity to institute new processes and technologies in ways many would have been nervous about doing in years past. Recently, ADP published an infographic highlighting a number of trends and technologies that are converging to drive accountants to look for new strategies, services, and revenue streams. Here are a few of the findings that resonated with us.
Accountants are an Untapped Resource
According to ADP, 57% of businesses say they are not fully utilizing all the services and insights their accounting firm can provide.
Businesses who utilize their accountants only for traditional bookkeeping, tax, and audit services are missing out on a valuable resource. Today, many forward-looking firms leverage data analytics, machine learning, artificial intelligence, and other emerging technologies to expand the services they provide and the insights they’re reporting. The focus is shifting from preparing historical financial documents based on past transactions to providing insights and advice for business decisions based on real-time data.
Accountants as HR Pros
Recruiting and retaining qualified talent is a challenge across industries, and accounting teams are increasingly working toward helping their clients in this area. According to the ADP infographic, 72% of Millennials and 62% of Gen X accounting firms already offer or plan to offer Human Resources/Talent Management consulting services.
Firms owned by Baby Boomers aren’t quite as sold on the idea of expanding into an HR service line. Only 34% of Boomer accounting firm decision-makers offer or plan to offer talent services.
For the firms that seize this opportunity, it can be a lucrative one. The survey found that 62% of businesses are interested in receiving HR/Talent Management insights from their accounting firm.
The HR and talent services businesses may seek from their accounting firm include:
- Developing HR policies and procedures and employee handbooks
- Representing the business during state, federal, and local HR compliance audits
- Talent needs assessments for startup, growing, and evolving companies
- Leader and supervisor training programs
- Handling difficult employee issues and employee conduct meetings
- Recruiting top employees and hard-to-find talent
- Developing HR forms including performance evaluations, interview evaluations, vacation/PTO/sick request forms
- Conducting exit interviews
- Benefit plan services
- Compensation planning
A CPA’s institutional knowledge of the business can be an asset when delivering HR and talent services, but hiring non-accountant HR pros or encouraging staff to earn the Professional in Human Resource (PHR) designation from the Society of Human Resource Management can ensure the team has the skills needed to deliver these services.
Don’t Fear the Robo-Accountant
According to ADP, 64% of accountants think that three years from now, accounting software will allow traditional accounting work to be handled by non-experts. However, 70% of businesses say the automation of accounting has not eliminated the need for accountants, and 66% expect that tax laws will become more complex.
Most major accounting software vendors already offer the capability to automate many highly-manual accounting tasks and save accounting teams a considerable amount of time. Over the next few years, we expect more aspects of tax preparation, payroll, banking, and even audits to be automated using AI-based technologies.
However, having machines do all of these tedious and repetitive tasks won’t eliminate the need for accountants. Instead, it allows accountants to move into more advisory roles and ultimately provide more value to the organization.
Integration is Imperative
ADP’s data shows that the average accounting client uses four software systems to manage payroll, HR, human capital management, time and labor, talent, and finance. Perhaps not surprisingly, 96% of businesses want at least two of those systems integrated.
An integrated system that can bring together different software applications so that they work seamlessly without the need for manual manipulation or additional software offers several benefits, including:
- More reliable data entry. Data entry is often a time- and attention-intensive task when information is scattered across disparate systems. Integration eliminates duplicate and incomplete entries and makes data more reliable.
- Enhanced productivity. Businesses can measurably increase productivity through integration by eliminating time-consuming tasks. Manual and attention-heavy data entry often results in human errors and duplication. Integration helps ensure reliable records and frees up time that can be spent on other business-building activities.
- Real-time visibility. Integration makes information more readily available. Reports can show performance across finance, sales, marketing, service, and fulfillment departments, giving users an integrated view of the company’s operations and allowing stakeholders to make business decisions in real-time.
The accounting profession has historically been slow to change, but as uncertain as the future might be, there’s tremendous potential. The most successful accountants will embrace the coming changes and transform their careers to leverage opportunities.