In recent years, accounting trends have been directly proportional to the advancement of technology. New accounting trends have emerged with the emergence of new technology. Following the outbreak of the pandemic, accounting practices have transformed. The prominent among them is the movement of companies to accounting outsourcing services from the traditional alternatives.
The majority of accounting tasks such as lease accounting, revenue recognition, inter-company consolidation, journal entries approval workflows, and other such tasks are repetitive by nature. To conclude them in time with due diligence, most outsourcing firms adopt the automation approach these days.
Beyond any doubt, the automation of repetitive tasks is an important accounting trend in 2021. It is not a new thing, though, given the increasing role of automation towards the end of the previous decade. But its growing role and deep penetration into the operations of the providers of outsourcing solutions is a new development to look forward to.
In addition, some other exciting trends have either made their way into accounting operations or are likely to appear towards the conclusion of this year. Here are some such trends.
1. The Increased Role of Artificial Intelligence (AI)
Whether you think of finance or accounting, these fields are replete with repetitive tasks. Manual effort can take hours or even days to conclude them. But the power of automation can lead to the quick completion of these tasks in a matter of a few minutes. It boosts the productivity of accountants and allows them to focus their attention on other important tasks.
2. The Prominence Of Accounting Software
Gathering the data of different formats and putting them together into a single system makes a big difference to the outcomes of accounting-related tasks. Otherwise known as harmonization, it is important for the successful use of AI through the inputting of data. With accounting solutions on the cloud, accounting software helps integrate all forms of data into a single system and provides insights.
3. More Emphasis On Forecasting Tools and Data Analytics
Most finance and accounting outsourcing companies have started embracing analytical and proactive solutions for accounting tasks. In this connection, they draw forecasts and data insights through tools and software programs. The use of these tools boosts the problem-solving and critical thinking skills of accounting and finance professionals and leads to better outcomes.
4. Collaboration of Remote Employees
Along with in-house employees, some companies also have a remote workforce that operates from a location outside the office premises. Cloud-based software solutions play a vital role in collaborating with such employees. With the deployment of the right set of collaboration tools, remote employees can easily collaborate with an accounting firm. All they need for this purpose is a computer system connected to the Internet.
5. Regulatory and Statutory Compliance
These days, financial reporting requirements also necessitate meticulous attention to regulatory and statutory compliance on the part of employees of firms who perform accounting and finance-related tasks. It helps them monitor statutory and regulatory compliance in the operations of a company.
6. Proactive Accounting
Proactive accounting or continuous accounting is a phenomenon that concerns itself with the use of automation for concluding repetitive tasks. It not only eases the workload on accounting professionals but also eliminates human errors.
The increasing role of outsourcing is a new and emerging phenomenon in the field of accounting and finance. Companies of different sizes have distinct reasons to adopt this approach. While the smaller companies do it to cut down the cost of hiring an experienced accountant, large-sized companies do it to have access to expertise and skillsets.
8. Tax-Policy-Related Changes
No doubt, the mandatory requirement to include the Covid stimulus while working out tax-policy-related changes has increased the workload of accounting professionals to a large extent. They need to gain a good understanding of it in addition to the existing tax policies for an effective calculation of taxes.
9. Workplace Wellness
Employers offer workplace wellness programs for the benefit of their employees. It necessitates accountants to keep an eye on the correct calculation of the deductions that employees earn. This apart, given the possibility of tax laws and regulations from time to time, they also need to keep abreast with the changes in the tax laws.
10. Accounting Standards
GAAP compliance, as indicated by the updates of the Financial Accounting Standards Board (FASB) each year, shows its effect on the financial statements of firms. In 2021, it will involve a wide range of elements. These include banking regulation disclosures, debt securities, asset acquisitions, and more. Ensuring compliance with these aspects will be a priority for accounting firms. The onus for it will be on the accounting professionals who work at such firms.
New accounting trends keep evolving from time to time due to the addition of new technology, approaches, and many other factors. The above elements constitute the new and exciting trends that outsourcing companies in UK and USA are embracing in 2021. Paying attention to these trends and investing in them can help you attain your business goals with proficiency.