Published on February 11th, 2021 📆 | 2136 Views ⚑0
How Technology Is Transforming One Of The Oldest Professions In The World
Co-Founder and Managing Director at Xero UK, the global leader in online accounting software, overseeing the company’s EMEA business.
The earliest traces of the accounting industry date back to the Mesopotamian era. Fast forward 7,000 years, and faced with a global pandemic, this ancient industry has been catapulted forward.
Emerging technologies, tools and crafts such as clay auditing systems or calculators have been used to manage accounts over the ages. However, I believe we saw more change in 2020 than we have over the past millennium driven by the impact of Covid-19 on work.
As millions of businesses around the world have had to pivot to survive, we’ve seen mass-scale adoption of digital tools. In particular, small businesses have taken huge advantage of the latest technology. You’ve only got to look at apps like Shopify, an e-commerce platform that has seen its share price shoot up as a result of selling its much-needed service to an increasing number of businesses.
What does this mean for the world’s accountants, who have faced their own set of challenges?
First, we have to take a step back and consider the initial impact. Accountants also had to adapt quickly to be able to do their jobs from home. What’s more, they had to work fast to support their clients — many of whom have been in huge financial distress.
Data from our small business insights report shows that revenues dropped by as much as 38.1% in April in New Zealand and 23.4% in May in the U.K. compared to 12 months earlier. Small businesses needed their accountants’ help fast to access capital and manage cash flow, and only those firms using cloud-based software were able to help at their time of need.
The firms that have moved with this changing pace are proving their value. Armanino, a top-25 accounting firm in the U.S., has built a reputation for commitment to data science by creating Covid-19 Recovery Trackers to help businesses to drive better decision-making.
Another example is Carrie Beam, a firm specializing in data science, helping firms to turn their clients’ analytics into strategic and problem-solving tools. Helping clients to “connect the dots” has enabled it to adjust to changing times while turning data analytics services into a key area of growth for firms.
The latest technology has unlocked the ability to make more informed business decisions, and with AI and machine learning at the very start of their capabilities, the opportunities for growth are endless.
Most firms are already using a number of digital tools, such as Slack, Zoom and Google Docs, to conduct business. In an ever-changing environment, however, there’s so much more to gain from the latest technology. The most valuable mindset for all accounting firms in 2021 is not to dwell on what you can’t do but focus on what you can do and what you can use to get there.
The digital transformation of the last decade has been a catalyst for growth for many new businesses — with sole traders, freelancers and gig workers all taking advantage of digital business models. More of these business models have emerged during the pandemic. These businesses need flexibility, quick access to financials and specialist advisory support anchored in technology.
There is no doubt that Covid-19 has been hugely challenging. However, it has also been a catalyst for extraordinary change. Using the latest technology, the ancient accounting industry has moved forward at a great pace. Accountants and bookkeepers are in greater demand than ever before, and this will only amplify in the coming months as businesses survive, reset and recover.