Top 6 Accounting Trends for 2021
With time, technology has always been shifting its shape — from being vaguely developed to bringing forward innovative features one has never seen before. It transcends imagination and morphs our ideas into reality.
Various industries acknowledge the changes technology has brought in. Even the accounting industry, which has been extensively modified with the latest developments, understands the need for modern integration within their infrastructure.
This development has also given birth to a few accounting trends practiced by top CPA firms around the world. Here are the top six accounting trends for the year 2021:
1. Cloud Accounting Solution
Cloud computing has steadily become one of the widely followed technological trends for 2021. Since its invention, it has gained popularity in the last few decades. From the automobile industry to the education sector, it has changed the dynamics of multiple sectors worldwide. It offers a wide range of functionalities, making it a favorite for many businesses, something the accounting industry has experienced.
According to FinancesOnline, 67% of accounting professionals prefer cloud accounting, and over 58% of large businesses have already implemented it within their infrastructure.
Hence, accountants worldwide have wholeheartedly embraced this modern trend. The cloud can smoothly host accounting software such as QuickBooks, which can be then made available anywhere, anytime. It provides stable security features that fare much better than conventional measures and also supports multi-user access — all this at an economical price.
2. Task Management Via Automation
Drop-in a coin, choose an option, and poof! There comes your drink. Yes, you are right. It is a vending machine that we are talking about. When automated vending machines were developed and installed at public outlets, they shifted from traditional retail outlets and improved the consumers’ shopping experience.
Similarly, when it comes to a company’s resource management, automating their operational tasks enabled multiple businesses to reduce human-prone errors, boost productivity, and lower cost investment.
Bringing in automation has also allowed accounting firms to experience a new efficiency level and significantly enhance their organizational output. Various business tasks like invoice generation, payroll processing, and account auditing can be readily automated.
This lets firms significantly cut down on the time and money required to complete these tasks and better leverage their resources. And since automation means decreased time investment for administrative tasks, employees have focused more on core accounting operations and increased revenue generation.
3. Embracing Data Analytics
When you think about the benefits of data analytics, perhaps the first example that will come to your mind is Walmart.
In 2004, Walmart analyzed data to predict what their customers will buy before hurricane strikes and stocked up on strawberry pop-tarts and beers. Their additional inventory rapidly sold-off, and the retail giant reaped greater profits in return. Since then, multiple industries have employed data analytics to predict consumer behavior, monitor their purchase habits, make better financial decisions, and improve their organizational efficiency.
Using data analytics has enabled CPAs to deliver the desired client approach and increased its business outreach for the accounting sector. Nowadays, clients want a proactive solution to their fiscal management. Instead of simply crunching numbers and churning out financial statements, they want their accountants to devise strategies to help their organizations grow.
With data analytics, an accountant can easily monitor their client’s investments, detect financial discrepancies, monitor transactional behavior, and improve policy adherence to the latest corporate norms.
4. Working Remotely
While the recent novel Coronavirus has forced multiple firms to either shut down their businesses or avail remote approaches to keep them running, a considerable fraction of American employees had already been working from their homes.
Started in the 1970s as telecommuting, remote working grew over the next few decades to employ over 4.7 million US workers. Letting their employees work remotely has allowed companies to experience greater productivity, increased employee performance, and reduced cost investments.
The same is true for the accounting sector as well. Access to technological tools that facilitate their employees to work remotely has been a boon for accounting firms. Instead of maintaining an office space, they can hire more employees and still experience no additional workplace costs. They can also widen their customer outreach as the clients can communicate with them using various video conferencing software like Zoom, Google Meet, and then upload their data remotely. Since most employees are readily available to work remotely, firms can easily avail of remote services from certified experts and bring expertise within their accounting operations.
5. Outsourcing Operations
When you are running an accounting firm, dealing with customer data is not the only task. You have to monitor workplace performance, recruit new employees, do invoicing, and manage customer support.
While various software solutions can aid you with these tasks, you will have to invest considerably in software procurement and hire the necessary personnel. Outsourcing these business operations to other firms will allow you to experience premium service at affordable rates and save money.
Instead of hiring new employees yourself, you can employ a hiring agency — just intimate the required qualifications of employees you need, and they will do the shortlisting and selection among the candidates.
Similarly, you can outsource organizational data to an outside firm for managing invoices and payrolls and let them do the needful. Outsourcing such business operations is an excellent option for firms that want to only engage in core accounting activities.
After AI was introduced for usage in the accounting industry worldwide, it brought forth structural changes that enabled them to boost overall productivity, increase efficiency, and smoothen their inter-organizational operations. Various processes like data handling and management were completely automated, which in turn enhanced accuracy levels and reduced human-prone errors.
Using AI, one can also discover compliance issues in their financial data, enforce corporate policy, streamline fiscal information, and protect yourself against any fraudulent activity.
Cloud accounting, the latest accounting software solution, data analytics usage, outsourcing business operations, and AI are some of the top accounting trends that are being widely followed in 2021.
They allow you to maximize your accounting operations and get the best out of your resources. So when you go for accounting in 2021, make sure you don’t fall back behind these trends.