If you’re an accounting professional who wants to advance your career in the ever-competitive marketplace, you should make a commitment to recognize and understand the important new accounting trends for 2020. Developing an understanding of the trends affecting the accounting profession is important when it comes to putting together a strategic plan for your business.
According to Forbes, the role of an accountant has expanded beyond the lessons learned in certification courses. Almost 70% of small business accountants today now believe their advisory roles will become more strategic in the future with the use of technology. Having a deeper understanding of company strategy will push accountants into a more proactive role in the future of the business. Company leadership will look to accountants for more input, helping them shape the direction of their firm and provide real-time insight on strategic decisions.
Ottawa University’s online Master of Accountancy (MAcc) degree prepares you for staying well-informed of the latest trends in the accounting field with a focus on developing graduates who are skilled financial practitioners with an innate understanding of the intricacies of contemporary business to help them advise executives in making strategic financial decisions for their companies.
Below are five prevailing trends for 2020 in the accounting profession:
#1 - Focus on Data Analytics
One of the key accounting trends in 2020 is the focus on data analysis of underlying accounting and financial information. Since information is key to making responsible financial decisions, advancements in data centers, database techniques and software have ushered in the age of big data and mining of data to aid management decisions. Information generated by accounting has always been a crucial component of business decision-making.
The process of analyzing numbers enables businesses to cull valuable insights in order to identify process improvements, increase efficiency and manage risks. New technology automates specific accounting tasks, and therefore the industry is shifting its focus to data analytics. Accountants are taking on new roles as advisors, with unique skill sets that revolve around analyzing data.
Although data analytics as part of accounting services is not entirely new, it is now more powerful, presenting financial performance in a new light for better actionable insights. Larger accounting firms apply data analytics in tax, consulting, risk management, and auditing. Meanwhile, CPAs in other organizations are utilizing the capabilities of the best data analytics solutions to support industry-specific needs.
#2 - Automation and Artificial Intelligence
A study by Forbes suggests that 2020 will usher in a new wave of automation in the accounting industry. Accounting professionals will increasingly be automating the labor-intensive tasks such as audits, banking, tax preparation, payrolls. This will result in a drastic reduction in accounting errors and workload, allowing accountants to take on more advisory responsibilities.
One of the exciting prospects of using artificial intelligence to automate accounting processes is the potential to effectively add a “virtual” member to the team to answer multiple questions and carry out simple tasks 24/7 even when the office is closed. This emerging technology will be used in the day-to-day running of firms allowing complex and repetitive tasks to be automated with AI, machine learning and robotics with extreme accuracy. According to global research conducted by Sage in 2019, 58% of accountancy professionals are expecting to automate tasks using AI solutions within the next three years.
The use of automation and AI in today’s accounting practices eliminates confusion and minimizes errors, which is why companies are more inclined to invest in these emerging solutions. Since these methods rely heavily on computers, there will be an increased demand for internal auditors to check for any data inaccuracies. Thus, the converse fear of in-house accounting services being replaced by bots is not an issue.
#3 - Cloud Accounting
Accounting Today reports that by 2026 the global market for accounting software will have a value of nearly $12 billion. The arrival of cloud computing or cloud accountancy has been hugely transformative in how accountants work on a day-to-day basis, and ultimately how they communicate with their clients. Between 45% to 60% of businesses have already moved to cloud computing, which removes the need to for businesses to install and maintain accounting software on each computer. Instead, software will be cloud- or server-based. As a result, software updates will be streamlined on the cloud without the need for time-intensive in-house renewals and downloads.
The concept of using shared resources, including accounting software that runs on the providers’ servers and being able to access financial information in the cloud, has made accounting information more accessible and the process more efficient. Furthermore, the result will be even more remote accounting jobs for collaborative accounting. Moreover, online accounting also gives the data an additional layer of security from hacking, damaging or being lost.
Adopting technologically-driven solutions is a trend that will intensify even more in the coming years. As the demand for digital accounting grows, accounting software companies will address this need with better solutions. These software platforms possess a range of functionalities accountants value the most, such as optimizing processes and minimizing manual tasks.
#4 - Outsourcing
The COVID-19 pandemic has triggered some of the most radical employment trends in recent history, including a sudden spike in remote working throughout all industries, accounting included. While traditional accounting firms are centered around cohesive in-house teams, there’s now a growing inclination for outsourcing specific tasks and projects to third-parties.
Businesses outsource in order to save money. In fact, according to recent surveys, 300,000 positions are outsourced every year and 59% of businesses choose to outsource in order to reduce their expenses. Outsourcing has many advantages, including enabling your organization to take on new clients, offer a wide range of services, and fill important skill gaps for highly-technical projects.
Outsourcing accounting functions has multiple benefits. It allows companies to focus more on their limited resources, while increasing profitability. It also saves them employment costs like payroll, taxation, salaries, benefits and training expenses. Hence, outsourcing accounting functions is becoming a popular strategy among many companies. This gives rise to the number of outsourced accounting service providers, which is one of the fastest-growing areas in the accounting industry.
#5 – Blockchain
Blockchain is a major trend in accounting that has been increasing in popularity over the last few years. The emerging technology refers to the use of a network of independent computers to record, share and synchronize transactions into an immutable ledger of accurate financial information. Continued investment in blockchain technology in 2020 is poised to yield real-world results beyond the big players as it becomes more practical, scalable and integrated into the operational structure of smaller firms and traditional global corporations alike.
Blockchain itself can be seen as a technology based on accountancy, according to Forbes. It records and stores assets, liabilities, transactions, and provides methods of recording cash flow and reconciling accounts. It’s a “natural” for the accounting industry which to date has relied on paper trails and even cloud-based technology to perform accounting functions and transactions and to ensure that regulatory requirements are met.
Blockchain is a formidable trend in accounting, and its applications will only continue to increase. It will change the way accountants operate. Accounting won’t become irrelevant, but rather will become more efficient. The same way computers and the internet have changed workplaces across all industries, blockchain will provide solutions to industry-wide issues in accounting.
The accounting industry promises a significant future for anyone willing to adopt new skills and technology. This is where Ottawa’s Master of Accountancy degree program can help. This 30-hour online graduate professional degree will prepare graduates for the aforementioned accounting trends, provide for career advancement and the opportunity to increase earning potential. The MAcc will also help you meet the 150-hour educational requirement to sit for the Certified Public Accountant (CPA) exam in most states.
Keep up with the major trends in accounting by advancing your career with Kansas City’s best, fastest and most affordable online Master of Accountancy degree. To learn more about earning your online MAcc degree at Ottawa University, contact us today!