Standard Data will drive Accounting's Evolution
THOSE THAT KNOW d&t know that as a firm, we've embraced online accounting with open arms. Having started using the technology back in 2002, we're pretty sure that we were one of the first "serious" users.
Back then, it was simply a case of needs must, as we had a number of clients all over the UK and no way to service them effectively from our base in Swindon. We've seen providers come and go in that time; we've helped major players such as Xero by being the first contracted UK partner with 75 licences at their UK launch, and have a keen interest in where the software is going.
And in my opinion, there still seems to be some way to go.
While there is often comment about the pace of change, I think that we need to remember that the world is always changing. I heard a story from my wife's grandparents which made me reflect.
Hanging without a telephone
When they started dating some 60 years ago, everything was going well until her granddad was ill one day, and he couldn't see his girlfriend at the agreed time. Today, we'd send a text message, or a WhatsApp message etc. The reality was, he couldn't even phone her. Obviously he didn't have a landline, but, he couldn't even make a landline call. So he had to write a letter. At that time, phones were only for the "rich families", and neither household had a telephone. Sounds like another world, doesn't it?
So things will change, and for those entering the profession today, it will look a lot different at the end of their careers than it did at the start.
Take, for example, the entry of data. Although bank feeds have removed some of the ridiculous duplication of work (banker processes cheques, banker prints statement, business owner reads statement, business owner processes statement, business owner prints management info...), there are still several areas where technology could take more of the workload. If the software industry could have a co-ordinated effort to build a standardised format of information, we could open up cross-platform invoicing from one user to another, regardless of software.
End-to end capability
Think about the implications of this. In a perfect world (and I know that there will always be exceptions), the processing of a sales ledger invoice at one end could automatically generate a purchase ledger invoice at the other. Yes, we would need to consider authorisation protocols etc, but any good business should have those anyway.
Take this one step further. The software could be instructed when to release payment (so for example, the business owner could choose to adopt suppliers terms, 14 days, consistently late... whatever they want as standard). This would then provide the software with the data to flag up impending cashflow issues, and reduce the reliance of businesses on their credit control efforts.
And finally, imagine the value of this data. Between the providers, credit agencies could report on true credit-worthiness of a business. In other words, the corporate credit rating wouldn't just be based on petitions, and information from bankers and the tax office; instead, we would be able to rate businesses based on actual business-to-business transactions - the transactions that other businesses care about.
This is one of many ways that technology can and will change the nature of accountancy. Others include automatic data interrogation and review, push notifications to advisers of their clients' problems/successes, and I'm sure many others. I don't believe that these changes are "60 year" changes - they will be very short term in the grand scale of things. And we will need to adapt what we do and how we do it to accommodate these changes.
I'd love to hear of other ideas that accountants (or indeed business owners) have regarding how our role in business can be assisted and improved through technology - it's an exciting time for us all!
Original source: http://www.accountancyage.com/aa/opinion/2410942/20-20-vision-standard-data-will-drive-accountings-evolution