Accounting Practices – A Forecast for the Decade Ahead

As we have written before, the role of accountants is changing, and changing rapidly.  Although not gone forever, the idea of the accountant as a grey-haired man who reviews your figures once a year and delivers a stentorious judgement on them and your business is fast fading. 

These days you are much more likely to encounter fast-moving, technology-driven young accountants who are in a position to offer advice when required, enabling you to make better informed, more rapid business decisions.

Forecasting a decade ahead is an undertaking for the prescient or the foolhardy.  At the start of 2010 who could have predicted Brexit and the Trump presidency – more importantly, who would have believed you if you had?  The same applies to accountancy and business practices.

Technology is a major driver here as those of you who have read our blogs from XeroCon and elsewhere through 2019 will have realised.  As proponents of Xero and other technologies we have no doubts that these technologies will improve and advance and their effect on businesses small and large may well be dramatic.

If in 2010 we had suggested that you could photograph your lunch receipt with your mobile phone, have the relevant information extracted and fed into your company accountancy package and allocated against the correct client and tax rating, you might have been rightly cynical. 

Here we are in 2020 and with Receiptbank talking to Xero, you can do just that. You can examine your figures from your mobile device anywhere in the world, in real time.  You can run cashflow projections without having to amass a ton of paperwork with all the human effort that would have required.  The world is changing, and those changes are affecting accountancy just as much as they do other aspects of our daily lives. As a direct consequence the role of accountants is changing just as dramatically. 

We have certainly seen that, and we love it!  Our role is no longer the collection of dusty paperwork and stained receipts followed by days of manual calculations while we try and work out how your company is doing financially.  Like you, we can check these things in real time, we are better informed about how things are going, and we are therefore better able to advise you about problems before they become too big to cope with and opportunities you may not have previously seen.

Accountants are still there to help you understand the legal tax regime within which we all operate, that’s why we spend so much time training and re-training.  It is unlikely that that role will change significantly in the next decade – you will always need someone to help you understand your Government’s latest bright idea! 

Technology may start to assist more; it is difficult of most of us to fully comprehend the likely impact of artificial intelligence on our jobs and lives; at this point I don’t fear that we accountants are going to be replaced by friendly number crunching algorithms. What we will be able to do is to use the considerable skills and knowledge we have accumulated over our years in practice, allied to the constantly increasing streams of data to help companies by acting not just as auditors of their financial situation, but also by actively advising them on how best to address their needs, their future intentions or the situations that they find themselves in. 

If I can make one, cast-iron prediction for the coming decade it is that accountancy will be an exciting place to work. The world runs on numbers and increasingly technology allows us to help you understand what the numbers mean. Accountancy as a profession is in a period of rapid change and there is no reason to suspect that there will be a let up anytime soon.

Whether you choose to run your financial software in house or to outsource it to a company like Anlo, the coming decade will see an unprecedented ability to view the state of business finances almost minute by minute.  We would caution against that, as even we accountants don’t spend our leisure time watching numbers! What it does mean is that as technology increasingly frees businesses from the time-consuming chore of manual bookkeeping, is that there will be more time to review strategic matters – where are we going?  Where do we want to be in six- or twelve-months’ time? How can we control our costs whilst delivering better, more responsive service to our clients? Those same questions apply to us and we are using the same tools that we use for our clients to answer them, or at least to help us answer them.

We will duck the big question posed in the title (because we are accountants and we like to be certain of things!) but expect the roaring 20s to see dramatic improvements in the ability of technology to free businesses to concentrate on their business and to spend less time raking around dusty filing cabinets for that three-year old cashflow analysis.  The future’s bright, better invest in sunglasses!