Who is taking your business?
The threat is already here: accountancy firms risk losing out to technology companies as software, machine learning and blockchain revolutionise how businesses do their accounts. Is the answer to team up with the tech companies, asks Jonathan Hollis?
Driven by the desire for cheaper solutions, software providers have already revolutionised the way SMEs manage their accounts, developing technology which is automating the entire accounting process.
Xero uses automation and smarter data entry to offer real-time cloud accounting and financial reporting, allowing you to manage your finances with a single click, wherever you are.
Smacc uses machine learning to help SMEs digitise and automate their accounting and financial processes by allowing expenses to be automatically allocated into accounts, learning over time.
Sage has built a virtual accounting assistant with its chatbot, which allows organisations to manage their finances, and connects to Facebook Messenger and Slack, as well as its own accounting applications.
Intuit’s Turbotax allows users to file their taxes online, and has now built a machine learning tool which allow its users to receive personalised financing based on their records.
This revolution has not yet occurred in larger, more complex organisations, but that’s not to say it’s not coming. For example, blockchain has the ability to transform the assurance practice.
The technology will allow two parties to record their transactions into a secure and impregnable joint register, identified by a timestamp. Once this is embedded into existing accounting software, the audit process could then become fully automated.
What will never change is the need for human interactions. In an increasingly online world, people still value human interaction, and I believe that this will be especially relevant in working life. This interaction may also help companies feel better in control of their data.
Data is already becoming a tradable currency, and therefore partnerships with software providers are essential. Accountants need to integrate these software solutions into their propositions by working closely with these companies, or better yet, by acquiring them.
Only equipped with their clients’ data, aggregated across multiple verticals, will it be possible to provide valuable insights.
In the medium term, professional services firms should keep at the forefront of technological change in order to safeguard their future, by upskilling accountants to become better technologists, who are able to make better use of the technology and data presented by their clients, while developing cloud accounting management expertise on using and interacting with multiple applications.
Jonathan Hollis works on commercial innovation at PwC and is a member of the Younger Members London committee.
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