Accounting professional studying accounting trends from 2021 to plan for his accounting firm’s future success.
In the accounting industry, “the future ain’t what it used to be.” And in 2021, several accounting trends continued and new ones emerged. For accountants interested in future success, here are the top takeaways and accounting trends from 2021.
Working from home isn’t a pipe dream.
Image Credit: Virtual Vocations
In 2019, Owl Labs’ State of Remote Work report showed that roughly 62% of employees between 22-65 years old worked remotely at least occasionally. The flexibility of a remote schedule has caught on, thanks in no small part to the disruption caused by the coronavirus pandemic.
Some people have denounced remote work as a fad. But, Clio’s 2021 Legal Trends Report showed that clients love remote almost as much as professionals. And, earlier this month, Gallup released its findings that roughly half (45%) of employees are working from home in some capacity. Although many companies hesitated to virtually meet or digitize their operations, now that they’ve done it, it’s hard to go back.
At MBS Accountancy, I was hesitant and nervous as we switched to a remote work model in 2020. Like other company leaders, I feared that we’d be less productive and fall behind on deadlines and deliverables due to miscommunication. But, I’ve been impressed by my team’s work ethic and self-motivation. Throughout 2020 and 2021, they rose to each challenge and difficulty and overcame them like superstars.
The convenience of virtual meetings over in-person meetings fits with the busy lifestyle of modern workers. Balancing our personal and professional lives is easier within a remote work model.
Artificial intelligence with human strategy.
The rise of AI has many accounting professionals fearing for their jobs. However, I believe artificial intelligence can be a tremendously valuable asset for accountants who learn to harness it. No, I’m not suggesting that computers will ultimately enslave humanity. Instead, I recommend looking at examples like the following:
- KPMG: This Big 4 accounting firm uses AI to increase efficiency during audits.
- Deloitte: Here, artificial intelligence assists with document review and analysis when working with clients.
Ernst & Young (EY): This Big 4 accounting firm has used AI to automate over 250 processes and save 2,000,000 human hours annually.
In a 2018 SardentTV interview, experienced tax professional Blake Partner made some important points regarding artificial intelligence and accounting.
Many accounting professionals in the finance industry fear that the advance in artificial intelligence will displace their jobs. However, Blake points out that AI can actually have many benefits to professionals. Rather than spending time on laborious tasks like data entry, accountants can use AI to create time for more valuable, profitable services for clients.
Big data is growing bigger.
In a world where data is growing exponentially, accountants are using real-time data provided by cloud-based accounting software to inform high-level business strategies. We use software like QuickBooks, Float, and Bill.com to automate many data entry tasks, so we can allocate our time wisely for our clients.
Instead of manually inputting transactions, we look at financial reports and financial analytics tools to derive insight on trends and key financial metrics. This information helps us advise clients on cost optimization, good tax moves, a tax strategy, and missed revenue opportunities.
One of the biggest benefits of big data accounting, however, is the capture of non-financial information (NFI). NFI data includes things like customer locations, consumer sentiment regarding brands and products, and online reviews. For example, a hotelier can use big data to aggregate listing rank changes on TripAdvisor to plan for demand spikes. A winery can study aggregated information about rainfall and average growing season temperature to determine the wine of the century. Reviewing this non-financial information can support informed decisions just as well as reviewing financial statements.
The future of accountants is advisory.
It is common knowledge that most business owners regard their accountants as advisors. But, in 2021, accountants are embracing that role and introducing services similar to a business consultant.
In April, I wrote about this advisory approach to accounting but here’s a quick summary:
Advisory accounting is simply about advising clients through an accounting lens. This results in clear-cut strategies that tangibly improve a company’s bottom line and decrease waste.
Accounting software is getting easier to use, which means that clients are increasingly turning to accountants for help with making decisions and interpreting data. People still need help with tax returns. But now, they’re also looking for a personalized tax strategy. They want financial strategies over financial statements, solutions over quick fixes.
Financial professionals are now being called on to advise on matters regarding robotic process automation (RPA), hiring and staff management, cybersecurity, and more. For example, back in 2019, I noted how accounting firms might partner with cybersecurity firms as part of a risk management service for clients.
As technology continues to open up new possibilities, modern accountants are moving toward advising businesses with a focus on long-term engagements. Businesses now seek out accountants offering more than deliverables like tax returns. The shift toward an advisory accounting model allows firms to provide a greater client focus.
Accounting trends are valuable opportunities for you!
Today, there are numerous accounting trends that offer you the change to become a profitable, digital-first firm. As you’re stepping into the industry or a firm leader, you can definitely benefit from the massive waves of change within the accounting industry.
Armed with the right technology, you can prioritize efficiency with prudent automation and use financial data analytics for better financial reporting. All of this means you can build a profitable future for yourself and your firm while ensuring that your clients see lasting success as well.