The year 2020 brought dramatic changes in every industry, and unexpected things continued throughout the year. The COVID-19 reshaped businesses’ functioning and forced companies to rethink their priorities and change the course of action. However, most sectors had already integrated technology and were using it to perform their functions. The outbreak of COVID-19 compelled industries to rely increasingly on it. Industries saw a striking rise and fall in their financial conditions as the COVID-19 continued to evolve the situation. Accounting trends were different, and most accounting trends that came forward were around technology progression.
The pandemic is not over yet, but most industries have opened up and are working following new norms and laws. Accounting enthusiasts use their intelligence to predict accounting trends and help companies design better strategies and improve their efficiency. In 2021, they believe that the accounting trends of the year are based on the volatility in the market, changing clients’ requirements, and regulatory changes. The pandemic made firms rely solely on technology, and accounting trends of 2021 revolve around advanced technology.
Some of the emerging trends of accounting in 2021 and beyond are as follows:
Table of Contents
Automated Accounting Processes
The most amazing benefit of automated processes is that it has reduced the chances of human error and made many processes faster. Companies rely on computers and other technical devices to save their accounting data, which has raised the demand of internal auditors to keep a check on data accuracy. Accountants need to ensure that during automated accounting functions, the process and outcomes align and are accurate.
Accounting has been a preferred finance discipline for the past few years. Modern students are more inclined towards e-education. Several people register themselves in an online MAcc to gain an academic insight into the accounting world. They learn to perform the accounting processes through automation as experts say that automated accounting operations are here to stay.
Many companies discovered cloud computing during lockdown when they were compelled to do work remotely. Due to the numerous advantages of the technology, many choose to continue working with cloud computing and benefit from it. Many firms were initially suspicious about investing in it as they thought it is a huge investment. Soon they realized cloud computing’s enlarged accessibility and efficiency override upfront costs and make the investment worth it in the long run. Cloud-based accounting allows people to work remotely and access their files at any time. Cloud-based solutions enable accountants to track sales, expenses, and inventory whenever needed, saving accountants valuable time.
Specialized Accounting Software
Since software platforms have various functionalities with minimum manual tasks and optimized processes, specialized accounting software will intensify in 2021 and beyond. The demand for software to manage spreadsheets and improve understanding of tax management and other accounting operations is strong. Many accounting practices already use software solutions; in the future, more software will emerge for other accounting processes. The key is to maximize efficiency through software solutions to analyze business requirements and select the software as per the need.
Outsourcing Accounting Processes
Outsourcing accounting functions is a new phenomenon, which is gaining popularity, and businesses are increasingly reaping its many benefits. Through this practice, companies focus on other processes and use their limited resource to increase profitability. Outsourcing saves time and expenses like hiring, training, payroll, taxation, and others. Furthermore, they get services from highly qualified people who have an in-depth insight into accounting and have served some years in the field. Due to the innumerable benefits of outsourcing accounting functions, experts say that the trend will stay in the market for a long while.
Blockchain technology has brought a change in the accounting sector by minimizing reconciling and maintaining ledger expenses. Additionally, it offers precise terms of ownership and assets’ history, a major accounting aspect. Another advantage of blockchain is that accountants gain a clear view of organizations’ resources and obligations which helps them in various accounting processes. Blockchain has seen growth in recent years, and it will grow further.
Data analytics has become a major aspect of the modern world. Even accountants use data analytics skills to perform their tasks. Data analytics in accounting help accountants gain valuable insights through numerical analysis and determine improvement areas to improve efficiency and manage risks. Accountants use data analytics and add value to the businesses’ decisions, resulting in increased efficiency and higher sales.
The entire year 2020 was the clear representation of the phrase, ‘expect the unexpected,’ as the industries functioned through the evolution of COVID-19. Technology played a vital role in keeping companies running, and new trends related to it kept on emerging. In 2021, most companies have resumed functioning, albeit with new guidelines and they, are still using technological solutions for many functions. Experts forecast that the upcoming years will be more digitalized, and technological advancements will be much faster.