In his book, “The E-Myth Accountant,” Michael Gerber states that as a whole, the accounting profession is rarely accused of being an early adopter of technology, often waiting for other industries to test new technology first. A study by Thomson Reuters confirms this idea, stating that only 11 percent of accountancy firms utilize cloud computing, which is some of the most basic new technology available for businesses. Yet, accounting firms have much to gain in terms of market awareness and visibility by adopting new technologies.
How Adopting New Technology Helps Firm Visibility
Adopting new technologies in your accounting firm has many direct benefits that also increase your firm’s visibility in the marketplace. Overall client-service systems, such as data entry, data storage, reporting, and billing, for example, become much more efficient. The latest technology enables firms to have less errors and turn around client work much faster, which makes the client happier and more impressed with the firm.
This can be exceedingly important in a world of smartphones, automated processes, and high expectations. When clients are impressed with the quality and speed of a firm’s work, they talk about it. And as any accountant knows, referrals are crucial to business growth. All else equal, a client will likely be proud to be with a technologically savvy firm. Investments in technology allow less time to be wasted and less staff, which helps the bottom line grow. A portion of the increased profits can be reinvested into more technology, increasing the efficiency of the firm even more.
What Technologies Are Good for Investing?
Probably the first important technology that a firm can implement to reap multiple benefits is cloud computing. Digitizing accounting services by using the cloud immediately makes your firm and employees more efficient. Since everyone is working in a centralized system, accessible from anywhere with an internet connection, your firm gains flexibility, scalability, and increased collaboration. Cloud services are also extremely secure, offer automatic system-wide updates, and are relatively inexpensive. Your firm can gain a competitive edge with the ability to streamline work and processes, and analyze accounting data in ways that a firm not using the cloud simply can’t do.
Another technology that many accounting firms can benefit from is Optical Character Recognition (OCR) technology. This technology goes far beyond a typical document scanner that turns papers and receipts into PDFs. OCR technology converts any hard-copy document, PDFs, and even images captured by digital cameras, into searchable and editable electronic documents. The advantage of being able to quickly search through a folder of electronic files rather than take the lengthy time to review a shoebox full of miscellaneous paper documents from a client is obvious.
Artificial intelligence (AI) systems are rapidly developing, along with accounting blockchain technology, which can ensure error-free transaction recording, and change the way taxes and audits are done. Specifically, some predict that the need to even file taxes in the future may be eliminated because of these technologies, and governments can securely obtain each individual’s tax data in real time throughout the year. Also, the concept of “real-time continuous” audits may become a reality for the first time.
Overall, technology is here to stay, and it’s rapidly transforming almost every industry. Accountants would be wise to begin adopting the technologies they are comfortable with since they will help their firms become more efficient, make clients happier, and ultimately position themselves better in the marketplace.