5 Things for Finance & Accounting to Look Forward to
A traditional industry like finance and accounting doesn’t often go through many changes. However, with the rise of artificial intelligence (AI), machine learning and automation, technology is having – and will continue to have – a huge impact on every business; changing the way people work within an organisation. And, finance departments are not exempt […]
A traditional industry like finance and accounting doesn’t often go through many changes. However, with the rise of artificial intelligence (AI), machine learning and automation, technology is having – and will continue to have – a huge impact on every business; changing the way people work within an organisation. And, finance departments are not exempt from this change. Below Andy Bottrill, Regional VP at BlackLine, discusses the future of finance and accounting with Finance Monthly.
Whether finance departments like it or not, technology is going to become part of the accounting process. And despite 71% of workers admitting to still using spreadsheets to manually carry out month-end tasks, 80% of businesses are expected to be ready to adopt AI by 2020.
So why should today’s accountants look forward to, and not fear, the future and technology?
Companies have already reported that 75% of intercompany transactions are automated, and this is only set to increase over the next 10 years; with 45% of individuals predicting invoicing will cease to exist by 2030.
Although the prospect of investing in automation may seem negative to many accountants at face value, they need to consider the long term benefits it can bring.
Workers must realise that technology will actually positively impact them. For example, removing mundane tasks such as admin data entry – automation can do this far quicker than a human, with a much higher accuracy rate. Using this technology, accountants are seeing manual admin tasks disappear, giving them time back to do tasks of greater value, such as financial analysis.
Augmenting the Accountant
A large concern around the future of finance and accounting is that robots will result in redundancies. But many fail to realise technology won’t wipe out jobs, but instead augment existing roles.
In 10 years’ time, the accountant we know today will no longer exist and instead, an accountant with a completely new skillset will have evolved. Technology is transforming employees’ roles, allowing them to transition from accountants who report last month’s numbers to reporters and analysts who deliver real-time data and predictive analytics.
Removing mundane tasks from day-to-day activities frees up time for more rewarding tasks in the finance department and others that require help – augmenting accountancy roles. Having the opportunity to work in other departments or take on other areas of expertise augments the skillset that accountants have.
Augmenting the accountant role in this way not only boosts job prospects within the workplace, but makes employees much more employable in the future. Making it an opportunity accountants should embrace.
Removing bad habits
Many organisations pride themselves on “best practices”, and don’t stray away from what they have always known. Sometimes, however, adhering to outdated traditional processes can do more harm than good and that is seen within the finance department.
Financial departments are known more than any to practice the phrase “if it ain’t broke, don’t fix it”. However, technology is changing this and removing these somewhat bad habits from day-to-day tasks and instead replacing them with new “best practices” through the use of technology.
Amid the personal benefits technology can bring to businesses, the practical savings are just as important – especially for C-suite level executives.
Imagine it’s the year 2028. The CEO questions the finance department on the likelihood of being able to acquire a desirable start up. In response, the CFO brings up real-time figures on her iPad and analyses them with her team to evaluate the potential options. She then emails the CEO their forecast: the business can afford to put in a competitive offer.
And while this evaluation is happening, the machine learning programme installed in the finance department has spotted and flagged a suspicious transaction that looks like possible fraud. The team are able to investigate this straight away, instead of waiting for auditors to discover it. Through this continuous accounting, businesses gain better insights and minimise mistakes.
Increased Sector Reputation
Whilst it’s important to look forward to the internal benefits technology will bring, it is equally important to understand the external impact.
When it comes to quarterly reporting, many finance departments have been scrutinised for incorrect data. But the technology available to finance departments today is helping reduce, if not eliminate, this from happening.
By using real-time data analysis, automation and machine learning businesses can reduce the number of reconciliations required and decrease the margin of error. As a result, more accurate financial results and closing data is produced.
This not only increases the reputation for individual businesses, but for the sector as a whole. Instead, accountants can promote their profession in a positive light. As businesses look to be the best in their industry, enhancing reputation is critical – and technology can certainly help do that.