3 Accounting Technology Trends To Keep On Your Radar
Accounting technology is developing at a rapid rate. In June 2019, Accountex reported that the accounting, banking and fintech systems were working closer together than ever before.
This accounting tech explosion is exciting – and maybe a little scary. To avoid app fatigue and make sense of this landscape, it’s important for both accountants and small businesses to understand the trends that are shaping the accounting app landscape, and how they will impact the way you do business.
Let’s take a closer look at three accounting technology trends and what they mean for small businesses and accountants.
1. Real-time data enables smarter, faster decision-making
Gone are the days of retroactively reporting on financials. Advancements in accounting technology are increasing the availability of data in real-time, enabling faster and smarter decision-making.
Instead of looking back and reporting on what has already happened to a business, real-time data is helping companies look forward and plan for a better future. Bryn Robinson, a Top 50 Cloud Accountant and a Partner at Fitzpatrick Group (an advisory firm based in Australia), was recently able to leverage real-time data to help a client avoid a potentially costly situation: “We established a sophisticated job costing system using cloud accounting add-ons. Due to this system, we were able to notice and react quickly to a downward change in his margins. We analyzed the issues, we established some strategies, and then we had the client back on track within the same quarter.”
Real-time financial reporting is especially useful for small business owners, who run their businesses based on cash balance. Real-time data provides up-to-date visibility into cash flow, which enables business owners to make decisions faster and helps their businesses continue to prosper.
2. Automated communication improves collaboration
As technology enables financial data to be available in real-time, it’s vital that communication and collaboration happen in real-time.
Many of our favourite cloud accounting tools are introducing features which help to automate communication and increase collaboration between accountants and small businesses. For example, Float recently introduced in-app Notifications, and Xero just launched an integration with Google Hangouts, opening up yet another convenient communication channel for accountants.
Moreover, integration tools such as Zapier or IFTTT (If This, Then That) can also automate communication between tools (i.e., sending notifications from a particular app to Slack) to keep all stakeholders in-the-know, reduce communication bottlenecks, and surface any changes in a business’ health.
One of the key benefits of automation is that it helps accountants and businesses can have more conversations about the things that matter, helping to build a more collaborative and productive working relationship.
3. Connected apps increase tech value
Given the aforementioned fast growth of the accounting tech landscape, it’s no wonder accountants might feel compelled to avoid new apps and add-ons altogether to seek all-encompassing solutions.
However, it’s impossible for one piece of software to be all things for all customers – it’s why add-ons exist in the first place.
“Software add-ons are focused pieces of software on a given task or need. They become a specialized tool necessary in the ecosystem of everything that accounting, tax and bookkeeping professionals have to do,” Don Emery, Director of Client Solutions for Doc.It, explains in Accounting Today.
Embracing apps and add-ons that integrate with each other will allow accountants and small businesses to customize their software solutions to fit their exact needs. For example, Hubdoc integrates with both Xero and QuickBooks Online to sync financial documents and data to enable one-click reconciliation and audit-proof your business.
Combining the powers of multiple applications enables more automation opportunities and improves data quality and availability, thereby increasing the value of your accounting tech stack. Like peanut butter and jelly, some apps are just better together!
Don’t be intimidated by the rapidly expanding accounting technology landscape! Exciting developments that enable real-time financials, increase communication and collaboration, and allow integration between tools will ultimately help to change your business for the better. Keep these trends top of mind as you navigate through the landscape and continue to educate yourself about new cloud accounting tools!
Float is just one of these accounting add-ons that can make your life, and the management of your finances, a lot easier. Sign up for a free trial today!
To find out exactly how Float can help you become a cash flow champion, sign up for one of our free webinars.