Question

It has been said that advances in information technology have made in both easier and more challenging to conduct. Please explain what is meant by this statement and provide examples of each point.

Answer 1

Over the last decade, technology has been developing at an exponential rate. It has had a big impact on the way we live our personal lives, and the effect on the ways we work has been even greater. Over the last five years, technology has changed how we manage many different aspects of business operations. Accounting is no exception.

Access to faster software that can perform more complex functions, as well as interconnected technology has made accounting both easier and more efficient. Indeed, organizing financial information, analyzing data, and measuring economic activity has never been simpler.

Five of the Biggest Impacts of Technology in the Accounting Industry

The age of technology in accounting has truly arrived, leaving a permanent mark on one of man’s oldest industries. Here are five ways in which technology has changed the accounting industry in the last five years:

1. Specialized Accounting Software

One by one, accountants are doing away with the traditional pen, ledger, and desk calculator. There now exist more efficient processing tools and specialized accounting software that allow quicker input and computation of data. In fact, even the act of manually entering information into software is declining as scanning technology makes it possible to simply photograph a page and let the software complete the relevant fields itself.

It is important to be precise in your computations when doing accounting work, and having all your information calculated by a computer has drastically improved accuracy and reduced the margin of error. Even the slightest of errors can mean trouble, including tax penalties, board discipline, and a hit to your professional reputation. Accounting software has turned the most traditional of white-collar industries into a fast-paced and dynamic profession.

2. Cloud-based Systems

The internet is something all businesses should learn to utilize fully. Too often, we think of the internet as nothing more than the place our company website and social media accounts reside. However, there is a momentous change that is currently sweeping across the corporate world: the cloud.

Many accounting firms are now using cloud-based systems to streamline all of their information. Wherever you are, whatever time of the day, all you have to do is log on, and you will be able to immediately access your data.

Having records in the digital format, and on one comprehensive system, means that you will be able to more easily manage and retrieve files when needed. Distributing accounting information to different branches within your company will also become a breeze. Moreover, using simple and ready-to-go cloud-based systems will significantly reduce Information Technology and file-keeping expenses. Security, backup, and data retrieval have also benefitted greatly from cloud technology.

3. More Efficient Client Transactions

Digitizing data and operations is beneficial not only for those working within the ranks or your company but also for your clients.

For one, there will no longer be a need for on-site consultations. Accountants and clients alike will be able to access real-time data remotely. Both parties will be able to simultaneously view, edit, and comment on their statements. They will then be able to convene and discuss in whatever manner is most convenient—including web-hosted video conference.

In addition, software and applications with consumer functionality have allowed non-accounting professionals to understand what is going on with their finances more easily.

4. Mobile Accounting

It might be stating the obvious to say that we have become increasingly dependent on our mobile devices. Yet despite their ubiquity, there are many advantages to mobile devices that small businesses have yet to take advantage of.

There are now mobile applications dedicated to accounting functions. These allow you to send invoices, add receipts, and create expense claims, among other tasks. You can accomplish all this with just a couple of swipes on a screen, and your data will be seamlessly backed up to the cloud. Moreover, having increased connectivity via mobile devices also allows for better relationships between accountants and clients. When an issue arises that needs an immediate answer, you will have access to the files and data you need, no matter where you are.

With a smartphone or tablet and a Mobile Device Management plan from your I.T. support provider, you can take your office with you wherever you go.

5. More Diverse Roles for the Accountant

If there’s one aspect of accounting that professionals dread the most, it’s the very tedious and tiresome task of compiling and computing data. However, with the advancement of technology, all that can now be done with just a click of a button.

Developments in accounting software and application have now given accountants more time on their hands for more diverse tasks. They are able to veer away from time-consuming number crunching and are increasingly able to expand into more specialized and strategic roles. More specific and value-adding roles are now up for grabs, and skilled accountants can provide more high-level specialty services. These may include data analysis and interpretation, providing financial planning advice and business consulting services, and more involvement in your company’s ongoing operations.

Accountants in the Age of Advanced Information Technology

As an accountant in today’s world, it is necessary to stay up-to-date with the most recent advances in technologies in order to be competitive and increase your productivity. Take the challenge and look further into all the intriguing ways technology has changed the accounting industry. Embracing these changes will prove to be greatly beneficial to both you and your firm.