It seems like every day we hear about another industry being threatened by the advancements in technology, but is accounting one of them? Cloud based accounting software certainly has risen in popularity in recent years, but QuickBooks and Xero are no replacement for living, breathing professionals – and here’s why…
Location Freedom
Before we dive into the main reasons why accounting software won’t replace traditional accountants, let’s take a moment to think about one of the ways in which it can enhance and improve their services: location freedom. Whilst you may sometimes want to sit down face-to-face with your accountant, using cloud software means that you need not choose a professional based primarily on location. It also allows far greater flexibility and convenience which is certainly conducive to a healthy working relationship.
A Smaller Tax Bill
Granted, accounting software is able to help maintain accurate records and automate calculations for your tax return, but it won’t help you take advantage of the latest lucrative tax breaks and incentives.
Tax law changes all the time and staying on top of them can feel like a full-time job in itself. A software program might help you get the numbers right on your return, but it won’t spot new opportunities to save a hefty chunk on your bill. Only a living, breathing accountant can do that!
Advisory
Accounting software takes care of much of the ‘grunt work’: the calculations, the forecasts and so on. What cloud accounting programs can’t do, however, is offer advisory services. A computer simply doesn’t have the business experience, critical thinking ability and financial acumen of a real-life accountant. Software can crunch the numbers, but it can’t offer advice and support.
Accounting software providers will tell you their product will do the work for you and to some extent that may be true but only if you understand accounting principles to begin with. If the data you input is questionable, so too will the calculations be in the end.
While you may save money in the beginning, you will pay more in the end when you end up hiring someone to fix your mistakes.
If you are intent on doing it yourself, invest in some basic training. This could come with ongoing support and makes it easy to increase the scope of the services you require at a speed that is more comfortable for you.
Businesses have been forced to navigate significant and sudden changes in law, initiatives, deductions and the shifting economic climate. Accountants have proven invaluable in helping entrepreneurs to navigate these ever-changing waters. The pandemic has brought us into unprecedented economic times and as the world continues to recover, advisory services will become more necessary than ever.
Consequently, these days more and more accountants are focusing on offering advisory services and acting more like business partners than processors. An experienced accountant will offer valuable advice and insights to their clients. If QuickBooks or Xero could do that, the monthly subscription fee would be significantly higher.
Accessibility
Rather than replacing human accountants, cloud accounting software may even render accounting services more accessible to startups and small businesses. Business owners can use software to handle the grunt work for a smaller fee, leaving more funds to invest in interpreting the numbers. Traditional accountants will not be replaced, but rather their abilities will be enhanced by the advancement of AI.
Summary
Cloud accounting software is certainly helping to enhance and transform the work of traditional accountants, but there is no danger of human professionals being eclipsed by technology. Accounting software is a means to an end but not an end in itself. As accounting software is increasingly able to take care of some of the industry’s more menial tasks, the role of accountants will not be eclipsed but will rather shift more towards an advisory one. Accounting software is certainly helpful for business owners, but there is truly no substitute for the shrewd financial insight of a professional accountant.