4 Ways in Which Technology is Rapidly Reshaping the Accounting Landscape

Published by LTBD, P.C. | January 18, 2018

Business, nonprofit and association leaders know that technology has the power to dramatically impact their fields, but often the focus is on how technology will impact what they deliver (the products or services they offer, or the communities and constituents they serve). Equally dramatic, however, is the role of technology in reshaping specific core functions within the enterprise.

One of these core areas that is undergoing rapid realignment as a result of technology is the accounting function. Here are four ways in which technology is changing accounting within the business, association and nonprofit worlds today:

1. Migrating to the Cloud

Cloud applications are rapidly shifting more and more business and accounting functions off the desktop and out of the in-house server environment. Cloud-based time tracking software such as Harvest or TSheets and cloud-based expense reporting applications like Expensify and Concur exemplify this trend. Cloud applications can be more easily purchased. They can be instantly implemented. And they can be tied together through third-party cloud-based connector applications such as Zapier.

NetSuite is the leading developer of native-to-the-cloud ERP software for emerging and middle-market companies, especially now that NetSuite is part of the Oracle application family. In the government contracting and project accounting space, Unanet and Deltek both deliver cloud solutions (Unanet was built native to the cloud, and Deltek has migrated to offering a complete cloud product line). And on the payable side, firms such as Bill.com are delivering cloud solutions that integrate with entry-level accounting products (such as Intuit QuickBooks and Xero) as well as middle-market solutions (such as Sage Intacct and Oracle NetSuite).

2. In-App Offers Driven by Big Data

Big data often seems inaccessible and hard to understand for smaller organizations, likely because they don’t work with big data on a daily basis. Nonetheless, we are all creating data sets that can be rolled up and create new opportunities for innovation as well as increased visibility to our organizations that drive better management decisions

The strategic application of these data sets within the user experience has been pioneered for the last 2-3 years by consumer-facing technology companies, where the scale of growth is exponential. For example, the personal finance product Mint.com (which is owned by Intuit, the same firm that delivers QuickBooks), is free to users. This is made possible because the product’s cost is subsidized by financing and lending companies. The reason that these companies pay for people to use Mint is that they combine their existing data sets and predictive models with the data that individual users place in the application.

The lenders are then able to create instant credit offers that are inserted proactive inside the application, in what amounts to a seamless, instant marketplace for users. Instead of filling out a bank application for traditional financing, you can now simply click on an offer that is already pre-tailored to meet your specific financial needs.

This revolution is also encompassing other data types, such as social media information. For example, one online lender is now assessing customer credit, in part, on the strength of their online social networks. The concept here is that if a lending applicant is largely engaged with a community of professionals who pay their bills, this adds to the creditworthiness of the applicant herself or himself.

All of these concepts are rapidly developing applications for the business and nonprofit market, and the next major shift in enterprise software will likely be to incorporate these seamless data-driven offers into the business workflow.

3. Integration and Automation

Thanks to the cloud and big data, businesses will also be able to gain the benefits of rapid integration, supported by new forms of automation. Connect your bank and credit card accounts to your accounting system and set parameters for reconciliation to auto-initiate in the background. Or if you use Salesforce.com, for example, you can receive new sales leads automatically through a third-party subscription plugin provided by ZoomInfo.

Allow your Square, Clover, Intuit GoPayment or bank’s online merchant account platform to connect to your cloud ERP system and schedule customer payments to run automatically, with payment information stored effortlessly online. Let your expense management database cross-reference with other apps to create a report that will show spending by category and stop an employee from crossing a pre-approved spending threshold.

4. Mobile First and Social Friendly

Finally, the mobile and social revolutions will dramatically alter the landscape on both the front and back ends. On the front end, Square and other mobile apps have already untethered payments from cash registers and POS terminals, allowing mobile users to literally take any payment at any time. In the enterprise market segment, companies are using these capabilities to deliver highly customized digital solutions to their clients on-the-go. In addition, associations and nonprofits can now seamlessly deliver donor and/or member engagement as well as seamless transaction processing in the mobile environment.

In addition, social media platforms are rapidly ramping up their eCommerce capabilities which means that a business or association can accept payments online within embedded social media environments, in addition to orders placed on their core website. Instead of directing a Facebook user to your website to accept an order or a donation, you can complete that entire process within the customer’s native social media experience and keep fluidity and speed on your side.

Responding to the Trends Reshaping Accounting

These four trends demonstrate how technology is rapidly reshaping the accounting process landscape for businesses, associations and nonprofits alike. The good news is that these innovations can lead directly to greater efficiencies, reduced costs, increased opportunities, better compliance and more profitable operations in the end. Take a look at your organization and identify one or two areas in which emerging technology can quickly make a positive impact on your bottom line.

Image Credit: alphalab (Flickr @ Creative Commons)
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