There was a time when an organisation’s books were managed using pens, pencils, and massive hand written ledgers. Luckily, rapid technological development has revolutionised the ways in which businesses are run in general, and particularly within the accounting industry.
The introductions of ‘Cloud-based Accounting Software’ and ‘E-Commerce’ have been the most recent digital advancements in the accountancy sector, helping to automate essential business functions. The modern day accountant now does not have to deal with mass amounts of data entry and transactional work, leaving him or her with much more flexibility to think strategically for the benefit of the business and its clients. Accountants nowadays spend more time being business consultants rather than focusing on administrative duties.
Moreover, technology has positively affected working methods within accountancy firms:
- Efficiency: Developments in accounting software has enabled firms to generate well-formatted financial reports, ready to be used, just by one click. Therefore, everything can be done much quicker which enhances efficiency.
- Accuracy: Accounting software has minimised human error, resulting in far fewer mistakes. Cross-checking is much easier and information shown in financial reports is correct and accurate 99.9% of the time.
- Quality: Because of technology, a large volume of detailed financial data and information is available for accountants. This means that precise analysis can be performed, trends can be easily identified, and quality of the work delivered ultimately improves.
- Flexibility: Cloud-based Accounting means that accountants do not even have to physically be at the office in order for them to complete their work, leaving them flexible in both the work they do and where they do it.
- Security: Accountancy software is some of the most heavily protected software to exist. They use the same hardware and secure encryption as are used for online payments and secure banking. Besides that, they use uncompromising antivirus and enterprise grade firewalls in order to protect financial data.
- Environment: This is a topic that is often forgotten, but perhaps is more important than all of the above. Advancements in technology have nearly eradicated the requirement for paper based working procedures, which is far better for the world we live in.
Furthermore, technological development has had a specific impact to support small businesses. As mentioned, certain systems such as E-Commerce have automated essential business functions – even the supply-chain can be managed through modern day digital applications. Cloud computing and cloud-based accounting means that small businesses can save costs as there is no need to invest money on in-house servers or expensive equipment. Simple daily tasks can be done in seconds using the various digital applications that are available. Small-business owners can therefore focus on what really matters to them: running the business. Instead of constantly focusing on simple daily tasks, they can now use their knowledge of accounting to add real value. Think about supporting decisions, appraising investments, and improving profit.
The Peloton is a ‘Gold Partner’ of Xero Cloud-based Accounting. Technology is at our core and we are always looking out for new digital innovations in order to improve the way our business functions. Feel free to call or pop in for any questions or concerns relating to Xero or cloud-based accounting in general.