Technology in Accounting is Enabling New Efficiencies
When it comes to Accounting, few people would ever associate technology as one of the driving characteristics of that aspect of a business. Typically when you think about accounting, the most common thought is that of a rigid bean counter who loves to work formulas in a spreadsheet. However, in recent years technology has made it’s way directly into the heart of this sometimes mundane department. If you are not looking at how technology can make an impact here, you are probably missing out on some really cool efficiencies!
5 Technology Areas Affecting Accounting
Whether you are a small business using Quickbooks, or a larger organization that relies on a heavier accounting package like Sage, chances are that you have at least had the discussion on whether or not it makes sense to move from your on-premise installed accounting software to the Cloud. With limited exception, just about all software developers are spending most of their R&D time and money on Cloud based versions of their software as opposed to the legacy on-premise versions. But even with the advancements that are being made towards this, there are some items you need to consider before moving completely to a Cloud offering;
- Feature parity – While Cloud versions may look the same on the surface as the on-premise version, chances are that there are some significant differences. Get a detailed list of feature comparisons and ask for what specific limitation are in the Cloud version. A good list of the comparison for Quickbooks versus Quickbooks Online can be found by clicking here.
- Is it truly a Cloud application or just a Remote Desktop – While technically both approaches are using Cloud technology – they are vastly different. A Cloud application will be one that runs inside of a normal web browser (or as a mobile app) while a Remote Desktop version will be one that may use a web browser to connect to a normal Windows desktop that you launch the desktop version of the software from.
- Security – Depending on what your answer was to the previous question will dictate some major differences to the approach on security.
- If it is truly a Cloud version or app – make sure you are using a strong password to the application and utilize 2 Factor Authentication. Additionally if you plan on accessing using a mobile device or tablet, insure that you have secured that device with a passcode as well as mobile device management that allows you to disable or wipe the device if lost or stolen.
- If it is a Remote Desktop version – Ask how your connection is secured. Make sure that you do not simply use a Remote Desktop Connection straight from your windows desktop as opposed to a browser based connection. Many CPA firms and providers are still using a Remote Desktop connection straight from the Internet using the standard desktop client. This could be a huge security issue since Remote Desktop Protocol that is not secured properly from the Internet has been identified as a top security risk by the FBI. Instead look for a provider that utilizes either a VPN connection for this or secures it using a web gateway and 2 Factor Authentication.
Artificial Intelligence and Automation
Most accounting packages available today have at least some Artificial Intelligence and Automation built in. This may be as simple as automatically downloading your bank and/or credit card statements and coding the entries with predictive accounts. It could also be as extensive as recognizing what type of documents you upload to your accounting firms portal and identifying and automating the data entry from those forms. Asking your CPA about the automations they leverage and offer will be advantageous to you further down the road.
Having the ability to have data “in your hands” at just about any time is getting easier for just about every type of organization and business. The ability to look up an invoice or payment directly from an app on your phone is light years ahead of where we were just a few short years ago. It wasn’t that long ago that I remember I had to go into the office to be able to pull up a P&L report from our accounting system and now, I can do that while eating lunch and verify costs before meeting with a vendor. Combine that with apps that integrate, like live mileage tracking and the mobile device becomes an extension of your office.
No longer are you tied to the canned reports that you were once relegated to with your accounting package. With the easily accessible dashboarding software available as a Cloud service, you can now access, report, analyze and display just about any data analytic you could want within minutes. By leveraging a dashboarding application, you can move to a more real-time data approach to decision making and evaluations. This allows you to be more flexible and nimble when it comes to the operations of your organization. A couple of tools available for this are Klipfolio and Domo.
Integration and Connectors
It wasn’t all that long ago when your applications were siloed and there was not an easy way to bring data from one application to another. In fact we worked with may organizations that had dedicated employees that just entered data from one application to another or exported to a spreadsheet and either hand-keyed that data into another application or had a manual process for importing the data. With the rise of The Cloud and the related app development, the tools to speed this process up and/or completely eliminate manual entry is becoming mainstream and affordable. With tools like Zapier, you can quickly connect multiple applications, add workflows and automations, and get disparate software talking together.
Tying It All Together
There are tons of areas that your internal Accounting Team or Accounting Partner can focus on to get better business results by leveraging technology that is now available. The first step is to start looking for the opportunities and find where you have the most bottlenecks. Most commonly those areas include;
- Any type of manual entry
- Any type of duplicate entry
- Repetitive tasks
- Any task that involves physical paper – most likely this can be streamlined
- Are you on the most current version of your accounting applications
- How does your CPA or tax preparer prefer you work with them
While accounting might seem mundane, it affects every other aspect of your operations in some form or fashion. By taking an aggressive approach to finding ways to more efficiently handle accounting tasks will pay dividends for everyone.
The technology available in accounting today is very robust and reliable for the most part. Most, if not all solutions have options available today for you to increase efficiencies and automate more of your processes. If you have not had a discussion with your software vendor in a while, that would be a great place to start!
Focus on the following initiatives to get a better idea of options available for your specific scenario;
- How can I access our systems easily and efficiently whether in the office or remote?
- How do we ensure the security of our applications while still providing ease of access?
- What options are there to automate your tasks (start simple and move up from there)?
- What options are available either natively through the application you use or by connector options (such as Zapier) to give you more open access to your data?
- What are some of the key metrics that you could track on a daily basis if you had access to the data that would allow you to focus on better productivity?
- Who would need access to see those KPIs and how would you act on them?
If you could identify a few key areas to improve either your ease of access to accounting information, or to improve overall efficiencies within your accounting practices – What would you redirect that time and effort to to better serve your customers or employees?