Accountants adapt to a changing world
The coronavirus has forced accountants to accept constant change, but while this has been tough, firms are now on a trajectory of real digital transformation. IRIS will discuss these themes and more at its upcoming virtual event.
Before Covid-19 wrought havoc across the business landscape, artificial intelligence and automation were often harbingers of doom for the accounting industry.
Technological advancements were tempered with concerns over redundancies, the loss of the human touch, or the inability of machines to replicate decades of specialist experience.
Yet in adjusting to life amid the pandemic, and whatever the next normal is, intelligent software has come into its own.
As social distancing and remote working environments mean swathes of finance duties must be carried out off-site, cloud computing and advanced payroll solutions have become central to business continuity.
Companies that allowed employees to work remotely, supplied laptops, and access to virtual private networks (VPN) before the pandemic, handled the transition much more seamlessly as others transitioning from a standing start stumbled.
Regulatory expectations have understandably shifted in the wake of Covid-19, but there is no loosening of responsibilities. Practitioners are still required to meet the auditing standards and provide the same quality and documentation criterion regardless of circumstance, and many are realising technology is their best hope.
“Given the growing impact of coronavirus on the global economy and the high degree of uncertainty, high-quality audits are vital to ensure users of financial statements are properly informed,” said David Rule, Financial Reporting Council executive director of supervision. “In many instances, auditors will need to consider developing alternative audit procedures to gather sufficient, appropriate audit evidence.”
Remote auditing, once anathema to accountants who could not envision observing and analysing without being physically present, could be here to stay as businesses consider the upside of investing in new solutions during a period of upheaval to strengthen processes over the long term.
The number of secure document-sharing platforms and video conferencing tools is growing, while the ability to digitise paperwork will be a necessity under Making Tax Digital; suddenly the machines are industry saviours.
Regulators have been clear they want to see the profession make better use of data analytics, artificial intelligence, machine learning software, and other digital technologies in audits, bookkeeping and reporting. There has never been a better time to take the plunge.
The evolution of the accountant
If there is anything positive to come out of the pandemic, research by IRIS has found that coronavirus has only accelerated hard trends that were evident before the crisis struck.
The survey revealed 25% of firms were growing their digital operations pre-Covid, but that jumped to 75% of firms who diverted resources towards more advanced software during the lockdown period.
“Many accountants have found this constant change tough, but as things are changing so quickly, we see evidence firms are pushing onto a trajectory of real digital transformation. They have found this gives them a toolkit to offer much-needed services to Covid-hit businesses that haven’t recovered from the first lockdown,” said Steve Cox, chief evangelist of IRIS.
IRIS also found digital-first accountants are increasingly no longer just bookkeepers but are ditching the paperwork to take on other priorities such as business strategy and controls, and succession and wealth planning.
“Certain accounting solutions make it much easier for small business owners to manage their books and can increase efficiencies, freeing up the accountant to offer more strategic services such as advisory,” continued Cox. “We are finding accountants are growing their advisory services during the pandemic which has resulted in them becoming closer and more valuable – a business partner for the clients they serve.”
Know your clients, know your tools
Savvy accountants have long realised technology can empower their practice, and those who have embraced the bots have found their role has changed, making them more vital to the future of their clients, rather than redundant.
“My practice and life was 90% online before Covid hit, so it has just helped us solidify what we do,” said Kevin Whitehouse of accountancy firm Prime Entry. “It's presented no end of opportunities for us and our clients.”
However, it’s not just a case of quickly pivoting to the array of technological solutions out there and hoping one of them will work, he said. Accountants must radically alter their mindset if they are to remain competitive in an era of hyper-change and perpetual disruption.
“Many in the industry have more than just technology to deal with,” he said. “Technology solves many problems, but creates many more problems if the culture and the thinking doesn't change with it.”
The tone from the top is central to breeding a culture where businesses are willing to look at new technology to solve certain problems but are also prudent enough to know each job is different and often requires different tools.
“One must also adapt to the client behaviour which is also changing through the influence of technology in their lives like Amazon and social media and apps, along with online banking and HMRC portals. IRIS provides the best software to the industry, but if those in the industry choose not to learn, adapt and implement, then it's a bit like teaching pigs to sing; it frustrates you and irritates the pig!”
No-one could have anticipated the rollercoaster 2020 has proven for the accounting industry, but it is clear some of the changes forced upon the sector are here to stay. There has never been a better time to revise how things were done in the past and consider the opportunities inherent in moving to a technology-powered practice.
“Ultimately, better technology makes for better accountants, who empower business owners to make smarter decisions,” concluded Steve Cox.
These themes and more will be discussed at IRIS Live, the accounting software’s new virtual event in November.