How Fintech Is Transforming The Role Of Accountants


New tech, along with deregulation, is transforming the way businesses manage their money.

The traditional image of the steady, cautious accountant is set for a shake-up. New technology, new software, and new regulations mean the role of the accountant is ready for an overhaul.

Artificial intelligence, automation, cloud accounting, Open Banking, Making Tax Digital all promise to transform the accountancy and advisory profession, and, by extension, create huge new opportunities for the businesses they serve. So, what is driving this change? What is the significance for accountants? And what will be the impact for businesses?

Key drivers of change

Financial information is flowing faster and freer than ever. Greater access to data, automation of processes and integration of software and tools is putting more power at the fingertips of key decision makers inside businesses, allowing for more responsive and better-informed decisions.

Artificial intelligence and machine learning in software and apps promise to unearth far greater insights than manual analysis can currently offer.

Increasing automation of processes around invoice management, credit control, cashflow forecasting, and reconciliations, to name but a few, will reduce the time accountants need to spend on these traditional duties, freeing up resources and expertise to focus on more value-adding projects.

Cloud Accounting packages such as Xero and Quickbooks are bringing together these capabilities and offering businesses access to these accounting services from anywhere and at any time. But there is also a proliferation of financial technology and software. And this is only going to grow, aided in part by the launch of Open Banking this year.

With UK banks now forced to open up their data, verified third-parties will have access to information to offer new products to help businesses and customers. This will allow customers and businesses greater to power to pick and mix the solutions that meet their needs best.

These developments will clearly have wide-ranging and transformative effects on accountants and businesses.

Impact on businesses

Many of the benefits for businesses are clear. Businesses, no matter how small, will have access to real-time financial information and reporting. This will allow them to take pre-emptive action or to react instantly to evolving situations.

And the greater access to data and more powerful tools could lead to better insight and decisions around budgeting, forecasting, analysis and resource management. For example, applications such as Fluidly are leading the way for SMEs, offering both credit control and automated cashflow forecasts powered by AI.

This could be particularly transformative for small business owners who may have previously relied on intermittent, or even annual, access to financial reporting, analysis and forecasting. The prospect of having real-time and month-end reports without the cost of employing management accountants could be very welcome to many.

There is, of course, the potential for big savings in terms of time and costs, with many of the traditional, time-consuming tasks of accountant being hoovered up by AI, automation and Cloud Accounting solutions. Does this mean a bloodbath for accountants? Far from it…

Implications for accountants

How businesses choose to react to these opportunities will of course be very individual. Reductions in head counts and overheads, and the use of outsourcing, will be tempting for some, especially the embryonic businesses and sole traders.

But many will opt to redeploy their resources – liberated from many administrative duties – to focus on their core expertise, as well as building the business. With more powerful tools at their disposal around planning, forecasting and analysis, they will be able to take an increasingly strategic role in identifying threats and opportunities.

As such they will be able to take more of a business partnering or management consulting approach, with greater input around pricing, costs, markets and future direction. And what is more, the new software and technologies are expanding the services they can offer, which will only serve to bolster accountants and advisors’ armouries through which they can assist their clients.

Therefore, there are huge incentives for accountants to shed their cautious image and embrace the tech scene. Those that can navigate this new Fintech landscape, advise clients on the optimal stack of different solutions, and utilise them to deliver for their business could be at a great advantage.

The primary role of qualified accountants, of course, is that of delivering the financial information to stakeholders and helping to ensure businesses are profitable, compliant with regulations and remain as a going concern. But the proliferation of new technology, software and regulation, promise to offer some exciting opportunities for accountants and businesses.

This article is originally posted in MinuteHack.

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