The future of bookkeeping is changing rapidly due to technological shifts in the way accountants, bookkeepers and most companies do their business.
Both small businesses and bookkeeping practices are moving in masses to cloud accounting technologies, signaling a change in thinking that places; size, interaction and mobility as business priorities.
A study in 2014 showed that around 14% of Australian SMEs were using cloud accounting software to manage their accounts and a further 46% were looking at conversion over the following 12 months. So that is a pretty big growth prospect for the industry!
As early adopters spill over into the early majority it would be useful and interesting to outline some of the things that bookkeepers will encounter over the next year or so.
Business advantages of the Cloud
Thanks to the push towards cloud computing and its’ clear, bright future, businesses can enjoy many benefits including:
- better use of resources
- reduced downtime and outages
- business agility
- reliable backup and secure storage
- cost efficiencies
All of these benefits impact on the way businesses are set up and run, especially with regard to their bookkeeping functions.
Why Bookkeeping will never be obsolete
Bookkeeping has always been more than mere data entry. An experienced bookkeeper can assist a business with accurate reporting, budgeting, debt collection and keeping a close eye on the business’ profits and potential. In fact, a good bookkeeper will embrace these new efficiencies as it allows them more time to help their clients really understand their business finances.
There are over 2 million small businesses in Australia that need the services of bookkeepers to ensure their accounts, financials and BAS commitments are delivered accurately and on time. The efficiencies being created by automated technology and services means that a bookkeeper can also service more businesses than before. This automation with increase their productivity, rather than putting them out of a job.
While the role of the bookkeeper is changing due to the advances in technology, the ATO, Treasury and other Government sectors are also appreciating that good bookkeepers are an integral part of any successful business.
The future of Bookkeeping
Most businesses will continue to require a bookkeeper to keep the books up to date, but bookkeeping is becoming more than data entry, balancing the books and reconciliations. Smart, adaptable bookkeepers and their clients will thrive in this new environment as the bookkeeper has more time to add extra value to their clients’ business.
Processing data is an essential component of bookkeeping but it’s repetitive and boring. Automation of mundane processes should be embraced because it gives bookkeepers a chance to flex their muscles and showcase their real expertise. As machines take on more of the routine data entry work, bookkeepers can turn their skills and training to managing, interpreting and reporting on key financial information.
What should Bookkeepers do now?
Two critical steps to guaranteeing a stable bookkeeping income are, taking on more clients and adding more services to their repertoire. Taking both these steps will not only make bookkeepers stronger but also transform their client value from a perceived expense to a sought after asset.
Bookkeepers need to develop and increase their skills in response to the explosive innovation and automation in the cloud. Providing consulting services, training, set-up and on-going management of integrated business systems for their clients is just the tip of the potential iceberg.
Successful business managers understand that good bookkeeping goes far beyond reconciling bank accounts and lodging BAS. CPA Australia reports that 32% of businesses fail due to financial mismanagement and out of those failed 12% have either poor, or no, record keeping systems.
Having accurate and up to date accounts, allows business owners to make better decisions, keep track of their profits (or losses) and monitor their performance in real time. Having a tried and trusted bookkeeper to manage day to day bookkeeping, budgeting and reporting requirements will not only alleviate the stress and pressure on the business owner but also mean they have the time to focus on running and growing their business and the clarity to do it well.
The advancement of technology is impacting on all areas of business and business types. Remaining focused on revenue growth and understanding the nuances of a business’ finances, still requires the services of a quality, experienced bookkeeper – one who continues to develop their skillset and evolve in order to remain relevant. Bookkeepers now have the time and resources to help their client’s businesses grow and thrive in this increasingly competitive world.
In this new wave of technology, you can’t do it all yourself, you have to form alliances. Carlos Slim Helu
