2018 Technology Trends for Accountants
As quarter four is well under way, we take a look at some of the things that will be trending in technology in 2018, and examine how accountancy firms can prepare for these and adopt them into their own businesses where appropriate.
1. GDPR is Mandatory from May
GDPR (General Data Protection Regulation), is an EU ruling on securing and protecting data, and replaces the more general legislation that has applied over the last 20 years.
GDPR applies to any business, regardless of size, which holds information on EU citizens, and when it takes effect on 25 May 2018, companies must be compliant with the rules and ensure their customers data is adequately protected from cyber-attacks, by encrypting and limiting access to it. Failure to do so will result in heavy fines.
For accountants, the legislation covers any data held on current and previous clients, such as details of their payroll, account returns, personal and business taxes and bookkeeping submissions. It also includes correspondence (internal too) and any marketing databases.
As the legislation is focused on protecting the consumer, each individual must give consent to companies holding their information, and have a right to have some or all of this deleted (‘right to be forgotten’) if they so wish.
The business is responsible for demonstrating that the consumer data was lawfully obtained, and destroyed appropriately when requested. They also need to advise any other holders of the same data that a destruction request has been made.
If your accountancy firm uses cloud servers hosted in America, it’s vital to ensure that they are also aware of GDPR and can secure data to meet compliance. Make sure all your computing equipment is secure and password protected, and review the process for data movement.
2. Video is Leading the Way in Marketing and Communication
As mobile devices are increasingly used for accessing the internet, people are looking to consume information in smaller sizes, and video is a quick way to learn something new on the go.
YouTube is now the second-largest search engine (after its parent, Google), as people turn to it for clear, helpful how-to guides. Native videos (directly uploaded, rather than as a link to a third party) appear on timelines and feeds of all social media platforms, with auto-play making it more likely that a video will be watched.
All businesses need to embrace video marketing; statistics vary, but it’s estimated that 80% of content consumed in 2018 will be video-based, and research shows that video shared on social media generates 1200% more shares than image and text posts combined. Not using video means you risk being left behind as more tech-savvy competitors use it to their advantage.
Video is also invaluable for sharing updates with existing clients, or giving them important information that can be explained clearly and easily by talking them through it. Using video is a more personal approach, and customers appreciate being able to get to know you. Creating them doesn’t have to be expensive, and having a series of videos ready to send to new clients saves time so you can focus on dealing with their accounts.
3. Cloud Accountancy’s Popularity Will Grow Even More
Cloud services for accountants and related services will see further growth in 2018. Companies are increasingly moving major parts of the business online, and the move to cloud accountancy has happened faster than predicted.
As with GDPR, much of the focus is on security and accessibility – both the client and the accountant can see the latest information and respond quickly to any changes or queries. Data can be backed-up online, protecting the accountant from having the responsibility of managing it locally.
Cloud services are also cost-effective – there is no software required, and there are few costs for support and maintenance. The tools required for the client to share information with their accountant is free or extremely cheap, making cloud services an option even for micro-businesses.
It also fits in with the Making Tax Digital for Business initiative from the UK government, which they hope to have in place by 2020. Adopting and becoming comfortable with cloud services now means one less headache for all parties by the time the legislation changes.
4. Businesses Streamline Their Processes with Apps
We’ve already touched on the popularity of mobile internet, and apps play a big part in this. New apps are being developed and uploaded to virtual stores for both Apple and Android users.
Tech-forward business owners favour apps because it allows them to run their businesses on the go. Google’s G-Suite is particularly popular, because it offers versions of its email, calendar and Drive (including documents and spreadsheets) which can be synced across devices.
More significantly, these apps can also talk to each other, allowing developers to link related programmes into one place, making things even more convenient for their users.
For instance, accountancy apps can be customised so that not only can users submit figures, but they can upload receipts, invoices, mileage and more via the relevant tool, which is connected to their accountant’s app.
There are generic apps for posting to and monitoring social media, track a brand or create content on the move (including writing blogs and designing graphics) as well as industry-specific apps. Accountants need to at least be aware of all these options, and ideally use them in their businesses.
5. Artificial Intelligence and Machine Learning is Coming (but not to be Feared)
The media is full of stories about AI (artificial intelligence) developments and the negative impact that this will have on businesses, particularly in traditional industries such as accountancy.
However, the reality is somewhat different, and rather than fearing the march of the machines, firms should see the opportunities of harnessing them to their own advantage, leaving the repetitive tasks to them.
Machine learning is a subset of AI, whereby machine use algorithms to interpret data and predict outcomes, giving accountants more time to analyse these results. Machines will provide real-time information, allowing faster responses to changes, and to make sure lessons are learned from failings – and successes.
Some of the tasks that machines will be able to do include: automate bank reconciliation, categorise invoices, carry out analytics to compare growth and revenue across years and quarters and spot errors in data to raise queries with the clients.
6. Automation Makes Life Easier
Following on from AI and machine learning, automation will become more commonplace in accountancy firms. Data automation relies on programmes that sync with software from providers such as Xero and QuickBooks, and ensures accuracy and time saved without transactions being entered manually.
Using apps, as we outlined above, automation tools capture information from receipts and invoices, tags them appropriately and stores them to be included in tax returns and client records. Giving data entry tasks to machines allows accountants to focus on more high-end work that relies on human insight and expert knowledge.
In the UK, 37% of business owners think that accountancy is becoming more automated and assume that they can do more of the tasks themselves. In truth, automation only helps them collate their data to be more easily processed by a professional, who is still required to deal with making returns on their behalf and dealing with more complex jobs.
For the accountant or bookkeeper, they save time by not doing the more mundane tasks and having to meet with their clients, allowing them to raise their fees or take on more clients or staff, whatever they prefer.
Automation tools can organise tasks and data research for you, so work is prioritised and tracked in real-time. They also allow the accountant to be more available to their clients, without taking them away from busy-work (as they do it instead) and to show those customers their detailed knowledge of their business and its needs.