The role of finance and accounting emerged in business practices dates back several hundreds of years. But, modern accounting is credited only around the 19th century.  Accounting over the years has progressed, bringing new procedures in its practices.  The IT and digital revolution changed the landscape forever by introducing accounting automation.

Accounting automation differs from traditional accounting through…

• Speed
• Correctness
• Consistency
• Costs
• Confidentiality

Does accounting automation change the role of an accountant.

The future of an accountant, a bookkeeper or CPA is not fading.  However, it is definitely going to change, especially in the post pandemic era. If firms are not adapting to the trend they are not going to move forward.  It is considered as an acceptable norm for an accountant performing `Work remotely´ or `Work from home´.

This shift in the functioning of accountants is achieved through accounting automation. Core factors supporting the transformation are:

1. Advisory - to increase billing and provide value addition
2. Technology - helps small firms to be at par with large firms
3. Differences eliminated - between CPA, accounting, and bookkeeping firms
4. Managerial functions - is undertaken by accountants by helping clients in making real time decisions.

Let us analyze the technological trends in finance and accounting contributing to automation.

Emerging technological trends for year 2021 and beyond

Advent of technology makes an overall impact on business processes. Technology is reshaping the functioning of finance & accounting. This advancement is aided by

1. Cloud based accounting:
   It helps both the employer and employee.

• Accessibility - to your data or records at any place and time
• Investment - no additional ongoing investment for technology upgrades
• Safe keeping - data is preserved in a secured place and easily retrieved
• Paperwork - is eliminated and indirectly helping the environment
• Control - of your financial and regulatory function is done easily

2. Regulatory Compliance:
   Governments globally adopt automation in some form for the purpose of

• Taxation – calculating and collecting the correct amount from citizens.
• Check point – to restrict people from tax evasion
• Flexibility – to implement the changes done in the policies
• Reminder – set to inform people the due date for payment

3. Artificial Intelligence utilization:
   Finance division is seeing the benefit of using AI for its decision-making process. The areas where AI is used are…

• Accounts Payable – invoicing, avoiding duplication, detecting fraud, reporting etc.
• Accounts Receivable – client’s payment cycle, cash flow etc.
• Bookkeeping – transaction and reconciliation process

4. Virtual Reality:
   This new breakthrough in technology is using the interface of keyboard and headphones. A virtual reality is created when we interact online, largely visual, and aural.

• Financial Data – gets wider coverage through visual and aural capture
• Risk – identification and managing new areas
• Alternative - ways of finding solutions in business

5. Block chain:
   Block chain is a digital ledger technology recording asset transactions and details in multiple locations.  It is cryptographically sealed, denying the possibility of manipulation of information.

• Auditing - tasks are reduced as the transactions are securely recorded and any alteration will have an audit trail.
• Banking - helps to end delays in verification of transactions, settlement and transfer of money etc.
• Legal - helps in maintaining contracts, protecting and transferring ownership to the right person.

6. Big Data:
   Internet connected systems generate a huge amount of data both in structured and unstructured form. Analysis and problem-solving skills help accountants to manage the pile of data generated.

• Market conditions - studied, assessed for risk and forward planning done
• Corporate conditions - improved through auditing and forensic accounting
• Equal footing - achieved for both SME firms and large enterprise
• Increase - in business effectiveness
• Reduce - the process costs
• Investigate - new means to estimate cost and return on investment

Alvin Toffler is credited with saying: “The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn.”

Accountants, in order to avoid extinction, should be ready to embrace technology and re-skill to retain their role as gatekeepers for any firm.  They need to develop ways to appraise the pros and cons of technological trends.

If you are an accounting firm, foreseeing a future in robotic process automation accounting, please give us a call. We have several automation solutions designed for accounting departments. After assessing your needs, our consultants can offer a free demo of our accounting automation solutions to help you understand better.