Accounting In 2019: Top Trends in Accounting Industry

Read our article that covers the emerging trends in the world of accounting and bookkeeping for the year 2019 and beyond.

A new year means new challenges for accountants and business owner alike that want to be on top of their accounting. To do so, one needs to stay on top of the greatest and latest technological trends that have disrupted the world of finance and accounting.

In our lifetimes, we’ve all seen technology being the biggest disrupter to every industry it touches. Based on my more than 5 years of experience in writing about the tech industry, I’ve witnessed this transformation closely.

I’ve seen on-premise storage being overshadowed by cloud storage, I’ve seen the world of finance slowly being automated. I’ve watched the entire domain of healthcare being transitioned to the 0s and 1s on the internet.

Along with these, I’ve witnessed a number of emerging trends that are shaping the accounting industry for the future, providing more opportunity to businesses of all sizes and efficiency to their accountants.

Some of these trends that will shape the future of accounting will be:

A-Automation and AI

By 2020, labor-intensive tasks like tax preparation, audits, and banking will be fully automated according to a Forbes study. This is a trend that’s considered one of the greatest transformations since the introduction of double-entry bookkeeping around 500+years ago.

According to a PwC survey, 87% of accountants and finance professionals themselves feel that accounting and tracking financials can be carried out with the help of AI and digital assistants.

You can read the entire study here!

What It Means to You:

Numbers such as these might make you think that accountants and financial professionals will be replaced by technology.

But it would no longer serve you to consider technology as a hassle and something that’s another thing that has to be done. In fact, the sooner you come to the conclusion that accounting and technology are two sides of the same coin, the faster you can make the transition.

So what can you do to not be left behind? We suggest you prepare now for the changes by staying informed of them.

Now we know that all changes can be difficult but the fact you’re reading this article is a step in the right direction.

And it’s not just you who should be aiming to stay informed. Make a point to encourage your fellow accountants to keep informed of the changes in the accounting world because AI is likely to bring a lot of changes in practice.

B-Blockchain

Speaking of automation and artificial intelligence, two trends that have revolutionized accounting, blockchain is another tech trend looking to revolutionize the way we understand fund transfer and globalization.

Before we talk about how Blockchain will change the way finances are handled, let’s take a moment to understand what Blockchain is really all about.

If you send money to a friend, you usually have to use your bank, who then sends it to your friend’s bank. The ledger of your bank will show the money being taken out. The ledger in your friend’s bank will show the money being put into his account.

But without a bank, how would you send money over the internet? Instead of “trusting” the banks to do the work, you can use a public blockchain, which doesn’t rely on the trust of any entity except the blockchain itself.

The blockchain is a distributed ledger that is made in a way so that if a fraudulent transaction is attempted, or someone tries to “spend” the same amount twice, the blockchain will reject the transaction. It’s a form of “trustless trust”, and does not need big institutions like banks to work.

What It Means To You:

Globally, Blockchain is still in its infancy and its evolution as it moves from the prototype stage to a fully functioning technology will still take a few years, to say the least.

Thus it can be said that keeping your eyes open to the change it brings will be vital to stay ahead of the curve.

C- Cloud

While accounting software has been around for ages, the move to the cloud is a relatively recent phenomenon that has been developing for a decade or so. The transition may still be in progress but many businesses have already taken the leap of faith.

The numbers too sing the same song. The overall adoption of cloud accounting today is between 45% and 58%, depending on the size of the company, according to Accounting Today 2018, survey.

The study mentions that 45% of small, 57% of midsized and 58% of large businesses select cloud accounting over desktop ones.

Another study by Accounting Today said that by 2026, the global market for accounting software will have a value of $11.8 billion.

What It Means To You

Technologies such as cloud computing are revolutionary when it comes to accounting. Why? It’s because cloud computing is the enabler for all technologies that we talked above and more than just those.

So, if you or your clients want to be updated on the real-time financial data, then it’s simply not possible without the cloud.

If you want to collaborate together with your accountants or sales team, again you would need cloud-based accounting software that encourages collaboration across multiple departments.

If you want to embrace AI then, again, you can’t do so without first jumping on the cloud because it’s the only way to access the massive amounts of data.

The growing ecosystem of cloud applications that integrates with accounting platforms has also proven to be efficient by making back-office processes for a wide range of businesses and industries.

So if you are still skeptical about jumping on board with cloud accounting, now is the time to take the leap of faith.

Looking beyond the trends…

The future is unpredictable. But our analysis about it has to be based on the conclusions we have drawn from the past and present. Based on the same, 2 major conclusions can be drawn about the future of the accounting industry:

The Future will belong to the adaptable

The cloud and AI offer powerful ways to automate and streamline manual and transactional tasks. However, the functions that will be impossible to automate will be those offered by financial experts specialized in decision making and planning.

Accountants can, therefore, future-proof their careers by embracing technology and building on their roles as their clients’ most trusted and valued business advisers. And they can only do so if they remain adaptable to all the changes that come their way.

The Human Factor Will Never Be Outdated

When Tesla built its fully automated manufacturing plant in California, it was supposed to be a revolution in automation.

But what ended up happening is the painful reality. The AI empowered robots actually slowed down the production and ended up being the biggest reasons for the plant not meeting its benchmarks. The company had to shut down the factory and hire specialized workers to train and manage the robots.

Founder Elon Musk himself admitted and went on to tweet-, “Yes, excessive automation at Tesla was a mistake. To be precise, my mistake. Humans are underrated.”

So with a fair certainity, it can be said that human accountants should and will never be underrated. The accountant that has obtained specialized training will both gain from and add value to whoever they assist in their financial pursuit.

Conclusion

The technological transformation has been at the center for every industry across the world, and its effects have been felt in even the smallest of businesses.

So, embrace change. Embrace cloud technology. And, embrace automation.

The only constant in the accounting world is change and finding stability in its fluctuations. With these trends as your guides, make 2019 your best year yet.

What accounting and bookkeeping trends are you most excited about? Which trends do you think will be most important to keep on your radar in 2019 Comment below and let us know.