With the development of new technology, shifting client expectations, and changing corporate requirements, accounting procedures have been altered over the course of time.
Today, accounting encompasses much more than just ledgers and bookkeeping. Various new techniques are being embraced by accounting companies in order to keep up with the times and better meet clients’ needs.
The consequences of the pandemic are still being felt today, and the only way to survive in the market for more extended periods of time is to adapt to the most recent accounting trends.
Embracing the new remote work culture is one method for the company to accept new technology and accounting trends, which is also one approach to staying sustainable for a long time.
Here are the top 10 accounting trends that will help organisations expand quickly and profitably. However, before we delve into that, let’s first define what accounting trends entail.
What Do Accounting Trends Entail?
The accounting professional as we know it today is shaped by advances and reactions to shifting environments, technological advancements, and other market pressures.
In what ways is the accounting sector evolving? Rapid technological advancements are a significant factor in this transition. The pandemic has sped up that adoption in numerous ways.
For instance, more people are utilising cloud-based accounting software, while automation and artificial intelligence are becoming more prevalent.
Having defined what accounting trends are, let’s now discuss the emerging trends in the accounting industry for the year 2023 and beyond.
Top 10 Accounting Trends for Businesses in 2023 and Beyond
Let’s examine the most recent accounting trends that you should be aware of:
1. Enterprise-Driven Accounting Processes
The way accounting is approached is being reframed with the help of machine learning and Robotic Process Automation (RPA). Continuous accounting is the practice of integrating duties that are typically completed only after a certain period into a regular day-to-day activity.
However, the advantage of continuous accounting goes beyond giving your accounting team fewer late nights.
You can increase productivity and data integrity by automating repetitive activities, which frees up time for your accounting team because mistakes can be a regular source of time-consuming labour.
By keeping an eye out for process efficiency, your team can then concentrate on fostering a culture of continuous improvement.
2. Advancements in the Accounting Role
Future accounting will see a greater amount of transactional work being automated and a rise in the role of the accountant as a leader and decision-maker.
Accountants are increasingly required to make use of their leadership capabilities, various so-called soft skills, and other characteristics linked to emotional intelligence.
Future successful professionals will depend on these abilities, along with training on the use of data analytics and financial expertise.
3. Occupational Wellness
Employer-sponsored workplace wellness programs are still a well-liked benefit, but maintaining them can be challenging for accountants.
Payroll managers and accountants, for instance, must ensure that the savings on health insurance that employees get through wellness programs are accurately calculated as withholdings in paychecks.
Accountants must also be aware of changes in tax legislation that affect how the costs associated with wellness programs are deducted as company expenses for tax purposes.
Wellness initiatives can be a helpful tool for employee engagement, in addition to potentially improving employees’ health.
Accountants should utilise programs whenever possible as they continue to experience high rates of burnout and stress from handling too many obligations.
4. Introduction of Advanced Tools for Forecasting and Data Analytics
One of the best accounting advice for smaller and larger firms is to use budgeting, forecasting, and planning software as well as data analytics and visualisation tools more frequently.
Technology will assist in moving the accounting and finance department from being reactive and transactional to becoming proactive and analytical as finance functions become much more analytical.
Institute of Management Accountants (IMA) recently introduced its Data Analytics & Visualization Fundamentals Certificate as proof of the demand for more analytical and tech-savvy accountants.
The course is designed to give accounting and financial professionals the strong critical thinking, problem-solving, and technological skills they need to help improve business strategies for the organisations they work for.
5. The Significant Impact of Artificial Intelligence (AI) on Accounting Roles
There is widespread agreement that AI can and will have a big impact on accounting and finance. Businesses are automating repetitive, mundane operations using Robotic Process Automation (RPA), thus freeing up time for accountants to focus on higher-impact and higher-value work.
Most accounting firms, for instance, have started using AI to analyse lease contracts. This makes it easier to quickly capture information on the start date, amount to be paid, termination, or renewal options and therefore frees up the finance professional’s time to make better use of the data rather than just searching for it.
6. The Growing Need for Automation and Technology
Some of the most interesting changes in the accounting sector include the rapid advancement of technology and a tendency toward automating monotonous accounting duties.
Workflows for approval, bank reconciliation, journal entries, inter-company consolidation, revenue recognition, lease accounting, and depreciation are just a few of the activities being automated.
Although many accounting tasks can be automated, there is a shortage of knowledge about the technologies and resources needed to put this into practice. But, it is those who take the risks that will gain the rewards.
About 70% of businesses that have automated more than one-fourth of their accounting tasks report a moderate to significant return on investment.
7. Emergence and Adoption of Accounting Software
For RPA to be successful, there needs to be a process called harmonisation, which involves the standardisation and combination of transactional data from several sources and in various formats.
Data that is organised, semi-structured, and unstructured can all be combined into a single system as part of harmonisation.
To be effective, AI requires a massive amount of data. Above all, accountants must be able to trust the results of all enabling technologies, and accounting software can help with that.
About 36% of businesses intend to rapidly adopt the use of cloud-based accounting systems. The administration of your supply chain, orders, and production can all be integrated via enterprise resource planning systems using your accounting software and financial data, like Xero.
Data from these various sources is consolidated by an integrated ERP platform to provide you with more useful business information.
8. The Digital Transformation In the Accounting Industry
Organisations are using digital technology to revolutionise the way they conduct business more quickly than maybe ever before, and accounting and finance teams have been at the centre of it all.
To account for additional revenue from subscription models, new channels, new physical and digital product offers, and more, they have put processes in place.
The technology used to support business strategies and respond to changing circumstances is one of the most urgent accounting concerns.
9. Online Cooperation and Remote Employment
Cloud-based software is especially helpful with the trend of remote working since it enables geographically scattered teams to work together and complete important financial tasks, including month-end close, from any location with a computer and an Internet connection.
Accounting will require collaborative software like Zoom and Google Teams and useful software for e-signatures and cloud-based file sharing.
10. The Rising Need for the Security of Data
Finance departments are one of the top targets for data breaches, a threat that is now more dangerous than ever. The breaches may result in identity theft, the theft of private information such as credit card numbers, and spoofing, which is the practice of making emails appear to be from reputable sources.
Accounting teams, who are already adept at scrutinising the details and discovering irregularities, will continue to need training in identifying potentially damaging emails and spotting attacks.
The accounting staff may promote cybersecurity inside their company by emphasising on its value.
Accounting methods and trends are always evolving, particularly as new technology is developed.
Many accountants today believe that technology is becoming more prevalent in accounting due to cultural change. This is because the future of accounting is shifting as a result of automation and cutting-edge solutions.
Outsourcing to a reliable accounting and taxation consultant is the ideal approach to reduce expenses, improve efficiency, and increase profitability as your accounting practice expands. The accounting industry may still be a few feet away from technology if we consider the future of accounting.
We are moving swiftly toward advanced technology fixes like cloud-based subscriptions, on-premise solutions, and Software-as-a-Service (SaaS), as well as accounting sector trends like outsourcing finance and accounting services.