If the terms telecommuting, blockchain and big data sound more like cutting-edge technologies than accounting industry trends, look again. Technology is changing how accountants serve their clients. These and other trends are making accountants’ jobs easier, not harder. In many cases, technology lets accountants do what they do best — provide professional accounting, auditing and advisory services.
As these changes take hold in 2022 and beyond, accountants and accounting firms need to understand trends in the field, as well as their advantages and potential disruptions.
The Continued Rise of Tech in Accounting
Although accounting has a reputation for being less technology friendly than some other industries, technology has always been a part of the profession. Accounting continues to move away from its reputation as primarily compliance-driven (forms and numbers) and toward a consulting mindset (tax, audit and research advisory services). As it does, it leverages technologies that support its goal of expert client service.
Public accounting firms and accounting departments will continue to embrace technology in 2022 and beyond. More than ever, individual accountants need to understand how these trends will impact their work. Accountants who recognize the impact of technology on their profession and who learn these new skills are more likely to advance their careers.
Some of the accounting trends that will continue to gain ground in 2022 include:
AI (Artificial Intelligence)
Confusing AI with automation is easy to do. Many accountants may worry that AI will take over their jobs by automating tax or audit processes. However, automation already exists in accounting, as illustrated by software the industry has been using for many decades.. AI, on the other hand, can take over support processes if the rules are clear and consistent. For example, accountants can use it to batch upload files or sort and compile data. AI can also handle a variety of client service tasks, such as scheduling meetings, billing clients and drafting engagement letters. By relying on AI for these tedious or administrative tasks, accountants have more time to focus on client service.
The growth in data analytics is part of the accounting industry’s shift to advisory services. Accountants use their data analytics skills to help clients uncover business insights by analyzing financial statements and other documents, identifying process improvements, and supporting operational change. Accountants who are interested in making their skill sets more desirable to employers and clients should consider learning data analytics.
Accounting firms manage files with vast amounts of sensitive client data; thus, data security is top of mind for all professionals in the industry. Cloud computing, which allows access to client data from a variety of devices, can make partners and company executives nervous for that reason. However, cloud computing applications have several security features that protect data, such as encryption and automated backups. This technology can prevent firms from suffering data loss from server crashes, lost or stolen laptops, or other disasters. Cloud computing can boost productivity, make it easier to serve clients and improve collaboration with clients and colleagues.
Big data is driving business cases in many industries, including accounting. Big data refers to the vast quantities of data (often measured in terabytes or more) generated by a company. Accountants use this data to identify trends and make recommendations based on what the dataset reveals. Big data supports decision-making, helps accountants focus on consultative services such as business planning, and can help identify potential fraudulent activities. As with data analytics, accountants who have big data expertise may increasingly be in demand.
Accounting in the New Work Environment
Before COVID-19, accountants mostly worked in an office and met with their colleagues, clients and partners in person. Telecommuting or working from home was considered a rare perk and generally permitted only outside of usual working hours, such as during busy season. Now, many accountants work from home on a daily basis, as do many of their clients. Adjusting to this “new normal” means being flexible about consulting with clients and colleagues via phone and video and in neutral locations such as shared workspaces.
As the pandemic continues to make an impact into 2022 and possibly beyond, working from home may be the new normal for the accounting industry.
Telecommuting offers many pros and cons.
- Cloud computing. As firms embrace cloud computing, telecommuting becomes seamless and secure. Accountants can access files at work or from a home office and easily share files with clients and colleagues.
- Teleconference software. The boom in videoconferencing software allows colleagues to easily reach out and connect with each other, for both formal meetings and quick chats.
- Efficiency and productivity. Working from home can save time, especially if employees have a long commute. It can also boost productivity by allowing workers flexibility in being able to work outside of traditional business hours.
- Work quantity and quality. Less experienced accountants may need more supervision than they can get by working from home. Employees may struggle to bill enough hours if they are distracted by home responsibilities. Alternatively, employees may work too much because they have constant access to work. This can lead to faster burnout and more frequent turnover.
- Collaboration. Even with videoconferencing software, working remotely can hinder an employee’s ability to brainstorm and collaborate with peers and partners. In particular, the informal exchange of ideas is much less accessible for remote teams.
- Technology concerns. Employees’ home internet connections may not be as robust as in-office internet, which can impact productivity and accessibility.
- Security concerns. Similarly, protecting client and company data can be difficult if employees access the cloud from insecure locations.
The Impact of Blockchain in Accounting
Blockchain technology in accounting is on track to gain ground in 2022. Blockchain uses a decentralized computing system to validate and secure transactions in a digital ledger. Because blockchain transactions are transparent and can’t be faked, many companies see the benefit of using blockchain in their financial statements. This could impact how audits are conducted.
Additionally, blockchain is the backbone of cryptocurrency and non-fungible tokens (NFTs), which are becoming increasingly popular investments. Understanding blockchain and cryptocurrency is essential for accountants and auditors who want to continue to serve clients on the cutting edge.
Prepare Today for the Future of Accounting
As these accounting trends indicate, the future of accounting is technology. The CPA Exam was updated in 2021 to focus more on IT, automation and data analysis, with more changes to come. At the same time, the profession will always provide clients with expert compliance and advisory services that help them grow their businesses.
The University of Nevada, Reno’s online Master of Accountancy can help you prepare for the future of accounting. With a curriculum that adapts to new and upcoming changes to the CPA Exam, our program will help you future-proof your career.