Essential and evolving technologies have had a huge impact in the finance and accounting industry, especially during the last few years. New technical trends have arisen – developments and reactions to the ever-growing landscape and market that shapes the financial world.
The biggest way to advance your career in the competitive, cut-throat finance industry is to understand and implement technological trends as they arise.
Don’t worry – it’s not as overwhelming as it seems. We’ve highlighted the ten biggest technology trends in accounting and finance for 2021.
1. Robotic process automation
Robotic process automation (RPA) has become more convenient than ever thanks to improvements in technology and access to cloud-based software. It saves a great deal of time on tasks like reconciliations, data entry, and routine account updates, as well as cutting down process times for audits and contracts to weeks instead of months.
One of the most significant advantages of RPA is the ability to leverage data for decision-making purposes. It’s not just about saving time. It’s about making smarter decisions quickly, improving productivity, accuracy, and customer service for accountants and finance workers.
2. Data analytics
Data analytics is being used to track and understand trends in business performance, spot operational risks, and develop better risk management strategies. The technology simplifies specialized accounting tasks, and as a result, the demand for data analytics is projected to increase significantly.
A big part of the transformation is the way that data analytics can be used to automate manual processes, and present financial performance in a different light for better actionable results – which is the key to making financial decisions.
3. Cloud computing
The move to cloud computing gives accounting and finance professionals access to continual updates of information, which allows them to analyze data and make decisions based on instant, cutting-edge information.
The cloud enables finance and accounting institutions to:
4. Blockchain technology
Blockchain technology is the new frontier in digital transactions and data management. It’s a digital ledger which automatically records and verifies each transaction across a decentralized network of computers, thus providing protection from cyberattack.
It also enables accounting and finance firms to share database retention infrastructure; rather than maintaining and reconciling records of the same transactions in separate, privately controlled databases, all parties can record in a shared ledger.
Blockchain is leading to new opportunities and services as firms continue to evolve; the demand for blockchain skills has grown exponentially in the past three years.
5. Artificial intelligence
Accountants are increasingly using artificial intelligence (AI) to automate repetitive tasks. It frees their time to focus on higher impact and higher value activities. Using AI – and often in conjunction with RPA – eliminates confusion and reduces human error. AI-powered predictive analytics are also being greatly utilized to forecast cash flow patterns, identify the best ways to invest capital, and more accurately analyze their investments.
More companies are predicted to invest in these emerging solutions with 58% of accountancy firms projected to use AI for automation tasks by 2022.
6. Adaptive cybersecurity
It should come as no surprise that cybercriminals frequently target accounting firms and the finance industry. Data breaches are a bigger risk than ever with successful attacks leading to identity or financial theft or extortion.
Today’s finance professionals need to be on top of all the latest developments in cybersecurity. Identifying critical areas of risk, developing plans to address them, and communicating with co-workers and clients regularly are critical in the digital age.
Training in recognizing risks like potentially harmful emails and data anomalies is necessary when looking for possible attacks.
7. Big data
Finance firms must handle and analyze vast amounts of structured and unstructured data every day. Big data projects can change the way finance professionals plan and analyze their day-to-day tasks, as well as anticipating customer behavior, and creating financial strategies. The structured data is key to providing decision-making insights.
When working in conjunction with AI and RPA, big data can be used to analyze processes, review performance, and make future predictions – saving accountants a lot of leg work. This is accomplished by integrating different sets of data from various sources.
8. Remote working
The trend of remote working – increasing to never-before-seen numbers in the COVID-19 pandemic – has changed the way finance and accounting firms operate. Online communication and collaboration have become the foremost priorities, along with enhanced cybersecurity tools for personal digital devices.
However, the shift to remote working has been a great advantage for financial workers, increasing the transactional process between accountants and customers, which in turn has had significant implications to service assurance and customer loyalty.
Many businesses outsource to save money – in fact, it’s estimated that 300,000 positions are outsourced every year. Outsourcing allows companies to fill skill gaps for certain projects only when required, offer a wider range of services, take on new customers, and reduce expenses.
Outsourcing provides flexibility in responding to the market, as well as dealing with revenue earned. It also saves companies on training staff or spending on expensive, specialized accounting software.
10. Internet of Things
From large financial institutions to small start-ups, all have found news ways to use the Internet of Things (IoT) data. It saves a lot of time and money by gathering and transferring data, as well as improving customer experience and detecting suspicious activity.
IoT in banking and financial services market size is projected to grow from $249.4 million in 2018 to $2030.1 million by 2023. Companies can use IoT to gather customer data and analyze it to predict their customer’s needs. With the continuous data gathering, services can be rendered almost instantly, drastically cutting down waiting time for customers and freeing up time for finance agents to focus on more pressing tasks.
Find your technological finance partners
Keeping up with and implementing technical advancements can be overwhelming, but we have you covered. Talk to the IT experts at Merit Technologies today and discover exactly how your firm can benefit and grow from the latest technical trends.