How can Technology Solve some of the Biggest Challenges of the Accounting Professionals?

As far as accounting challenges and the impact of technology are concerned, professionals in the field believe “accounting’s ability to adapt to the rapid pace of change, will immensely help to implement the inter-corporate governance in their system.” Some of the most challenging tasks of accountants are

· Management of the organisation’s staffing system

· Succession planning

· Tax reform

· Cybersecurity

“The introduction of data analytics and innovative technologies such as artificial intelligence and bots provides the opportunity for the greatest change in the accounting profession.”

This does not nullify human intervention. In fact, with the implementation of these technologies, faster results could be achieved by humans in identifying internal control mechanisms, business planning and adopting security measures. Let’s see how.

Tax Reforms and Analytics

It is very difficult to incorporate analytics into tax because of the complexities of tax laws and the limited availability of current data as to tax structure analysis. Most tax software is compliance driven. However, some organisations are trying to circumvent the bottleneck by trying to find a pattern between available data as to the types of business transactions and their tax outcomes using high-end analytics tools. With the practice gaining momentum, questions such as how will tax return figures change depending on the internal and external factors within a business could be answered with much ease and accuracy. The use of analytics can also help accountants to inform on how businesses will be influenced with the introduction of new tax reforms, in terms of future investments, tax deductible operations and the likes.

AI and Machine Learning in Reviewing and Classifying Transactions

Organizations are rolling out big investment in turning such endeavours into reality with accountants playing the roles of active supervisors. Artificial intelligence could be used to differentiate between transactional patterns which follow a norm and those which do not, thereby picking out exceptional occurrences as presumptuously fraudulent transactions. Everything is fine with this system, except data bias, which may crop up if fraudulent transactions form the norm, and to prevent which the intervention of accountants is required. This is a technology still at its formative stage and holds future possibilities of automating auditing. A fool proof system entails the identification of the subtleties of transactional patterns, a knowledge that can only be fed to systems such as these by accountants.

Blockchain Technology in Ensuring Data Security and Accuracy

Cybersecurity threat is a major reason why accountants feel wary about handling data online. However, innovations in electronic documentations such as blockchain technology are opening newer and more durable paths to data protection. Blockchain is a digital ledger that is constituted of thousands of blocks containing transactional records. The defining feature of blockchain is that each block is represented by a digitally generated unique code, also known as a hash, that exists in combination with the unique code of the preceding block. Thus, in order to manipulate a block, one must also change the code of the following blocks which might amount to thousands of blocks. This is an improbable task, thus making blockchain a near impenetrable technology.

Blockchain has the potential to offer unprecedented clarity over transactional data. This includes date, time stamp, amount, and most importantly, the ownership of assets and liabilities as block records the digital signatures of the participants.

Use of Cloud in Enhancing Data Security and Productivity

Just like a bank vault, which is the most secured place for your valuables, a cloud accounting software is the most viable option for your mission critical data. Cloud computing platforms such as Microsoft Azure, Google Cloud Platform or Amazon Web Services invest billions of dollars to ensure end-to-end data security and recovery in their robust datacentres. Microsoft Azure, for example, keeps your data in Trusted Execution Environments (TEEs), which acts like a protected container denying entry to access requests outside of TEE. This is one such measure among many that Azure has adopted to maintain security besides the fact that they work with a global security incident management team to detect and respond to a wide array of security threats.

In conclusion, technology is redefining the accountant’s role from expert financial informers to well-equipped and competent business strategists. An accountant’s ability to adapt to newer technologies is directly proportional to his/her professional success.