In Pursuit of Profit
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As business technology continues to get more sophisticated, business owners may wonder if an accounting software can simplify their staffing needs while still providing high-quality bookkeeping and financial reporting. Accounting software companies would have you believe that managing your books is as simple as generating customer invoices, adding receipts for your expenses, and linking your bank accounts. And while software can certainly streamline these day-to-day operational activities, the question still remains, are these types of platforms a true substitute for your in-house or outsourced accountant role?
So, can you replace your accountant with some shiny sleek software?
The following are reasons why technology will never entirely replace accountants:
Automated technology and smart apps still require oversight to ensure accuracy and business owners overwhelmingly do not want to take on the responsibility of having to push the buttons and pull the levers for the financial technology they are using. There will always be business owners that outsource their bookkeeping because they either do not have the time to do it, the desire to learn an area of the business that is not glamorous, or the willingness to assume the risk of doing it themselves.
Even activities, like reporting, that can be entirely automated still need to be owned by someone when ad hoc work is required. Having an expert sign off on completed reports and financials for tax filings and investors provides an added layer of reassurance that many business owners desire. It also lends the kind of credibility that banks, investors, and other lending institutions may require to obtain funding.
While it is true that accounting platforms continue to get better every year, they still require skilled operators. Our team explained this concept in a previous article about how to get the most out of QuickBooks:
QuickBooks is an excellent bookkeeping platform for small businesses. However, it is just that – a tool to keep track of finances. The benefit that a business derives from QuickBooks is contingent upon what is put in and how much expertise is available to use the tool correctly. QuickBooks will not manage a business’s finances any more than a hammer will build a house without a carpenter there to swinging it.
Simply put, a financial professional is still necessary even with an online accounting software because technology is only as good as its user’s proficiency with it.
Accountants do not simply work with data, they also provide financial advice to improve cash flow management, aid in tax planning, and inform hiring decisions. Beyond simply generating deliverables, a person can analyze and interpret data into actionable recommendations in ways that software cannot.
Business finances are getting increasingly complex with more business intricacies and options muddling bookkeeping, so accountants will always have a job no matter how sophisticated technology gets. This is an especially salient point in areas of the country that have numerous local and state business regulations layered together to create complex financial guidelines.
Software is best for activities that are highly reproducible, not unique situations that require a customized approach. More specialized businesses or companies in financially complicated industries will always benefit from having an experienced accountant on staff to provide the “art” side of accounting to supplement the “science” that an accounting software provides.
Additionally, an accountant can recommend additional ways to use technology to tie into your accounting software in a way that the software itself cannot – creating additional efficiencies and even greater accuracy. Today’s accountants understand how to integrate online accounting platforms with supplemental financial apps to track expenses, manage remote workers, and prevent fraud, among other benefits.
In the years to come expect technology to enhance the work accountants do as well as facilitate better relationships between accountants and clients, not replace it.
For more information on how to get the most value out of your accountant, please read our quick guide, “Is Your Accountant an Advisor?” and reach out to us if you have any questions.