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Practice Management in a Future-Ready Accounting Firm!
Every now and then, new trends emerge in every industry, and following the same becomes a necessity for firms since treating new trends like an option can make them lag behind their competitors. Talking about the accounting industry, it too is witnessing some major changes, with the technological revolution being the primary one.
Incorporating the use of technology in the working of an accounting firm is not just limited to replacing human efforts; it has a much bigger role to play in streamlining the overall processes. So, let us get started and figure out how technology is and will be changing the way CPA firms practice in the present and coming times, respectively.
- As per the Sage Practice of Now 2018 report, accountants preferring cloud accounting are close to 67%.
- According to PayPie, almost 70% of accountants associated with small businesses believe their advisory roles will become more strategic in the future with the use of technology.
- Xero reports that businesses that used complete cloud-based accounting solutions (100%) witnessed 15% revenue growth year-over-year.
- As per Accounting Today, the global market value of the accounting software is expected to be around $11.8 billion in the coming 8 years.
- 66% of accountants are looking to invest in AI, with 55% of them planning to use the same in the coming 3 years, explains Sage.
- As per the Digital Workforce report, Robotic Process Automation boosts operational efficiency by 44% by replacing the manual, repetitive tasks with automation.
- 59% of accountants believe data science and analytics will play a bigger role in the coming times, explains the Business-Higher Education Forum report.
Top 9 Ways Technology Refines Accounting Processes and Roles
The combined use of multiple technologies like Artificial Intelligence, Cloud Accounting, Robotic Process Automation, Big Data and Analytics, Blockchain, etc., enables an accounting firm to leverage the following capabilities and reap associated benefits:
1. Process Integration
Most of the firms miss out on various opportunities due to the simple reason that they do not have integrated processes that enable the sharing of critical information at the right time.
However, the future accounting firms will not work like this; instead, they will make use of the cloud-based technology to integrate their internal functions like billing/budgeting, sales and marketing, on-boarding, scheduling, etc., to increase the ability of the firm to grab the informational opportunities at the earliest.
2. Remote Working
Due to corona virus, accounting firms have realized the importance and potential of remote working. This will be one of the biggest adoptions by firms in the future as well after the pandemic is over. With cloud-based accounting systems, accounting professionals can work from anywhere anytime.
This not only ensures uninterrupted accounting services from professionals but also provides them with working flexibility, which is fast becoming a demand amongst the top talent. So, firms who would want to retain their top talent will definitely consider remote working in the long-term.
3. Faster Processing
CPA firms waste a lot of time on managing the manual, repetitive tasks that can be used on other core competencies. Technologies like automation help in saving the time of accounting firms by taking care of the repetitive tasks easily, leading to faster processing eventually.
There are multiple firms that have already automated most of their processes and are utilizing their time on the other important aspects of their business. For instance, public accounting firms have decided to use Robotic Process Automation (RPA) into their processes, mainly with respect to assurance, advisory, and taxation services.
4. Enhanced Client Service
Clients are becoming more demanding, and only the firms that can manage these ever-increasing client demands in a timely and efficient manner will rule the market. The use of chatbots is increasing more than ever, and the accounting industry is not lagging behind. Clients demand instant help against their concerns, and with chatbots, firms can answer their common questions related to accounting and taxes timely.
Apart from this, cloud accounting enables firms to share information/data with the clients to speed up the discussion matters and provide solutions.
5. CRM Opportunities
CPA firms who are using a CRM (Customer Relationship Management) system are not only able to retain clients more but acquire as well compared to other firms. The reason being a CRM system helps in providing complete information about a prospect and client in real-time, enabling firms to look for opportunities within that data for client retention and acquisition.
So, this full interactional view system is not going to be an option but a necessity for firms in the future for sure.
6. Superior Decision Making
Firms have to make important decisions on a regular basis, and the right decisions can only be made when the right information is available. With cloud-based systems, firms are able to gain real-time visibility into data to make quick/refined financial and other decisions in the interest of the company.
Apart from this, this data also enables firm owners to devise strategies for growth and scalability.
7. The Advisory Role
Today, clients do not simply want tax preparation, bookkeeping, and other accounting services from their firms. They need guidance from their firms with which they can reduce their expenses and improve their business. With the use of the latest/advanced accounting software such as QuickBooks Online, Xero, FreshBooks, Wave, NetSuite etc. firms will be able to save a lot of their time and invest the same in trying to understand the financial data of clients.
This will help accountants in not only letting clients know of ways to manage their taxes well but also help them know of the strategies that will bring down their business costs and improve their tax situation in the future. This is something that will become one of the biggest competing factors amongst the accounting firms of tomorrow.
8. Mobile Accounting
Mobile accounting will definitely be on the rise in the future of accounting firms. Most of the people have Smartphones in their hands that have the potential of executing a lot of professional tasks on the go. Mobile accounting will become essential owing to less time availability, great accessibility, and convenience it provides. Accountants can save a lot of their time using mobile accounting in executing simple tasks for which they do not have to visit their offices or open their laptops/desktops. These include:
• Creating and sending invoices
• Creating claims for expense
• Capturing receipts
• Gathering signatures and more
9. Improved Security Measures
Accounting firms are all about managing and dealing with financial data that includes a lot of sensitive information. Most of the firms have already invested in cloud systems that offer round-the-clock protection to financial data through restricted access and data back-up.
However, the use of blockchain technology will rise in the future in the form of an accounting ledger that can be regularly updated and verified with zero threat of alteration and corruption. Since blockchain will enable real-time ledger access, along with recording transactions and creating smart contracts, it will be preferred over other technologies in the future.
A majority of CPA firms are already making use of most of the technologies to refine and redefine their accounting processes, and others are fast catching up on the same. The future of accounting will surely be dependent on incorporating the maximum use of technology into the processes to streamline overall practice management.
However, a lot of tasks need human intervention/management and demand a lot of time and effort, especially the back-office accounting ones. Firms can get their backend tasks managed with technology, but it usually becomes more expensive for them to invest in technology, infrastructure, salaries, etc.
So, what can be the better option for accounting firms? The better option is to join hands with a top outsourcing provider like Cogneesol. It has been providing unmatched and highest-quality accounting outsourcing services to CPA firms and businesses since 2008. Start your free trial by getting in touch with our team today itself!
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