Tax technology is changing the role of accountants across the world. Among the newest technological practices that are taking over industries right now is a focus on data and automation. While some tasks are being taken over by artificial intelligence (AI), humans are still involved and in control of the accounting process.
Thus, the job description for an accountant is changing right now. Previously, they were doing a lot of the groundwork themselves. Now, technology is doing that for them. That doesn’t mean that accountants are out of work, however.
It’s important to understand just how tax technology is changing the industry right now in order to adapt. Doing so will prevent job loss and make accounting more efficient as a whole. Let’s first focus on the direction technology is taking this industry, then discuss what that means for accountants.
The future of accounting technology will be shaped by data. Earlier this year, Ohio University released an infographic entitled “Three Accounting Tech Trends To Watch For in 2019.” The three listed were data analytics, machine learning, and cloud accounting — all three of which are grounded in big data.
Data is important to marketers and law professionals because it gives us insights on consumer behavior. In the digital era, every transaction is more easily recorded and available for tax professionals to have a hold of. As we continue to employ AI solutions, this data is eventually going to be mostly compiled by machines themselves.
To be clear, There is a difference between AI and automation. AI is based around creating intelligent machines, and automation does not need to include this kind of intelligence. Since automation’s purpose is to reduce the need to perform repetitious tasks, this has been often done without machine learning. Since AI is in a period of rapid expansion right now it’s important to note that automation has been utilized in businesses for much longer. The processes that are already automated will continue to be, but AI may make them more efficient.
This naturally leads to the question: If numbers are being crunched by machines, where will accountants go? Their roles will fundamentally change. They will oversee the systems and start to play more financial advisory roles. They will still be in charge of accounting, and their skills will still be important, but much of the groundwork will be done by machines.
There will always be some setbacks with big advancements. In the case of technology, a lot of those setbacks come down to the safety of personal data. For an accountant, personal data involves financial transactions, making this a sensitive subject.
Email frauds for accountants often happen differently than they used, so you need to be in the know. DataServ gave a great example of this in an article published late last year:
A common scam is to duplicate a vendor email: Everything from the email alias down to the signature line are spot-on matches for the legitimate vendor. This copycat email will request a change to the ACH (automated clearing house) bank account where they receive payments. Once the change is made, the payments go straight to the scammer’s bank account, rather than the vendor’s account.
The article went on to explain that automation can actually be used to prevent fraud as well simply because it makes audits easier. In other words, when scams happen and money is stolen, automation allows accountants to detect suspicious behavior because the information has already been recorded.
It is time for tax firms to prepare for new technology that’s changing the game. A big part of an accountant’s job will be advising, data input, and operations management. It’s important to ensure machines don’t make mistakes, because sometimes algorithms can have problems within them.
Most automation software is based in the cloud nowadays, which is excellent for the different parties inputting and retrieving financial information. However, compatibility between all software and systems is required to make sure all information is accessible, or else financial records may get lost in the mix.
The cloud helps with cybersecurity issues as well. Accountants will need to ensure that all software and systems are running well and continue to give good advice to those seeking it. Additionally, they will need to know how to work within the data systems to give proper analyses on peoples’ financial statements. They must adapt to new technology to augment their skills.
It’s crucial that you embrace technology and work with it. You also have to be aware of the dangers, of course. But if you are, then you can use automation to your advantage and help drive taxation and accounting into the digital age.
Do you use automation in your accounting job? Do you already see your role in the world changing with it? Let us know your opinion in the comments below!