The accounting industry is shifting towards digital adoption by integrating artificial intelligence, data analytics, and data security.
FREMONT, CA: The accounting industry is adapting to the changing market conditions due to digital adoption. The industry is expanding to accommodate other fields like business processes, automation, data analytics, and other digital fields. Advances in technology are leading to the wider adoption of cloud-based accounting. Businesses employ artificial intelligence (AI) and machine learning (ML) software to automate financial procedures.
In the accounting industry, automation of repetitive tasks is a newer development. Companies are automating procedures like approval workflows, inter-company consolidation, revenue recognition, and lease accounting. Studies show that 70 percent of companies that have automated about one-fourth of their processes experience a higher return on investments (ROI).
The accounting industry is adopting digital solutions to streamline its activities. Emerging digital applications in the accounting industry are:
AI: Accounting firms are automating repetitive tasks and freeing accountants to focus on higher-priority tasks through robotic process automation (RPA) tools. Companies are applying AI to analyze contracts and capture important information such as termination, renewal terms, and dates. Accountants can focus more on making decisions than looking for and organizing data.
Accounting software: For accounting firms to optimize automation through RPA, data from multiple sources must be harmonized in a single system. Accounting software uses credible information required to harmonize vast amounts of data. Thirty-six percent of businesses plan to deploy cloud-based accounting software like enterprise resource planning (ERP) systems to integrate financial data with other areas of the operation. ERP platforms provide more consolidated data for accountants to gain actionable insights into a business.
Data analytics: Many companies are combining budgeting and planning software and data analytics and visualization tools to analyze data. The accounting industry is becoming more analytical than transactional. Data analytics tools enable accounting firms to forecast future financial trends more to advance business strategy.
Digital transformation: Digital adoption allows accountants to generate new revenue from subscription models, channels, and physical and digital product offerings. Accountants also oversee business strategy by leveraging technology and adapting to changing market conditions.
Data security: Cyberattackers largely target finance companies, and data breaches are a big concern. Client details and in-house financial accounts are vulnerable to data breaches. As financial companies adopt digital solutions, they must undertake effective training programs recognizing harmful sites and emails.
