5 Accounting Technology Trends Small Businesses Must Follow in 2023

Accounting Technology

Last Updated on March 22, 2024 by Aiman Emaan

A new year means new trends and technological innovations. It’s 2022, and we’re eager to see what new might be happening in the accounting world this year. Accounting can appear stale and lifeless to those with little knowledge of it. However, new emerging accounting technology, along with the effects of the coronavirus pandemic, will most certainly cause accounting to undergo significant changes.

Whether it’s a blockchain-enabled transformation of accounting practices or new ways of working in the wake of the pandemic, the accounting sector will undergo many changes in 2022 and beyond. So, after gathering market insights and doing some research, we were able to jot down some trends that will impact 2022 and beyond.

Accountants will also remember the early 2020s as the time when computing brought their profession into the 21st century. It is also remembered as the time when home offices replaced office buildings, which took over an accountant’s life. Now let’s see what this year has in store for us. Obviously, this list is not comprehensive, but here’s a quick overview of things to watch out for in the upcoming year.

Automation and artificial intelligence

Business and accountants can automate their processes using Artificial Intelligence to work with more clients at the same time. The Future of Jobs survey from the World Economic Forum estimates that 50% of complex and technical activities will be automated by 2025, an increase of 40% over 2020.

A lot of negative press is associated with automation. Despite that, the sort of automation you’re likely to encounter at work doesn’t entail robots hammering at Excel sheets, typing a thousand words per minute – it’s far less oppressive. In fact, automation is the new version of accountant technology that will assist you in your everyday tasks, making it easy for you to manage several things at once.

The year 2022 will bring more advances in software that will allow routine, monotonous tasks to be completed with minimal human assistance. In other words, your computer can perform tasks for you, such as processing invoices, scheduling appointments, etc.

Blockchain As Accounting Technology

There are good reasons the accounting industry should learn more about blockchain technology. Ledger reconciliation and maintenance costs are being lowered by blockchain in the accounting sector. Blockchain also makes asset ownership and history more accurate. A blockchain-based accounting system allows accountants to clearly see their organization’s obligations and resources. The fact that hundreds of blockchain wallets are created monthly, many of them belonging to companies, is not surprising. Approximately $1.1 billion is expected to be spent on blockchain technologies by the end of 2022 in the US, according to statistics published by Statista (Statista data, 2020).

The four Big Boys of the accounting industry are already joining the blockchain trend by opening distributed ledger labs. Deloitte, Price Waterhouse, Ernst and Young, and KPMG have distributed ledger labs. It’s in the hopes that distributed ledgers will become real. But, unfortunately, they’d probably lose their auditing and accounting departments in that case.

Cloud-Based Accounting Technology Services

Cloud accounting is becoming increasingly popular. A cloud-based accounting system gives companies and firms access to their system from anywhere, which is excellent for teams that have moved to remote working arrangements due to the COVID-19 pandemic. Companies can also track expenses, inventory, and sales through cloud-based accounting systems. Furthermore, cloud-based solutions create workflows that save businesses valuable time. Such benefits motivate enterprises to shift to cloud-based accounting systems.

In light of this, 67% of accountants now think cloud technology can make their jobs easier. The findings are consistent with a recent survey conducted by Sage, revealing that 53% of respondents rely on cloud-based solutions for client communication and project management. 

The increase in the demand for advanced technological solutions could be linked to the rise in various industries’ technological uptake. For example, accounting is one of those sectors that is making a giant leap for better and more accurate financial statements and analysis.

Accounting Outsourcing

Many companies now outsource their accounting functions and enjoy the benefits. By outsourcing, companies can focus on what they can do best while maximizing profitability. They also save on payroll, tax, benefits, salaries, and training expenses. Because of these benefits, outsourcing accounting functions is becoming a common strategy in many organizations.

Therefore, many firms are offering outsourced accounting services. Outsourcing of accounting is presently one of the most rapidly growing segments. Outsourced accounting provides value and results to businesses every year. Today, outsourcing has become an indispensable method for CPA firms to deliver quality services to their clients, analyze their business operations, and increase the value they add to their businesses. As a result, a career in accounting, especially in business processing outsourcing (BPO) companies, is becoming highly regarded worldwide.

Accounting Technology advancements

There is no doubt that computers have fundamentally changed workplaces since their introduction. Likewise, the accounting will undergo a revolution due to blockchain, automation, the cloud, and third-party providers.

Technology will improve accountants’ efficiency and productivity while also maintaining a healthy balance between work and home responsibilities. For instance, the new technology led to significant time savings (30%), improved productivity (15%), cloud access (10%), data accuracy (7.5%), and fast data retrieval (7.5%). 

The Takeaway

The accountants of 2022 and beyond will have to deal with a lot of new challenges. One thing is for sure: technology will continue to be a major driver for the accounting industry in the new year. The result is a need for accounting professionals to upgrade their skills. Knowing technologies that can assist in meeting client demands is also beneficial. Accountancy is set to be a large industry in 2022, so get ahead of the curve now.

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