Technology is ever advancing, and like every other industry: trends emerge that get picked up by various sectors of the business world. One such trend is automated accounting processes.

What are Automated Accounting Processes?

In a nutshell, automated account processes involve setting up a series of workflows/tasks that require using specific software to automatically program essential tasks relating to finance and accounting. In other words, it completes these tasks that would otherwise be done manually by yourself or an external accountant. These tasks often include accounts reconciliation, updating financial records, and creating financial statements with minimal/no human intervention. The process undoubtedly saves much time for an accounting team as well as fully eliminating human error.

This technology allows for teams to say goodbye to slogging over Excel spreadsheets, hour after hour. It is not to be confused with computerised accounting. Automated accounting involves sophisticated software that eliminates tedious tasks, such as data entry and calculation checks, allowing the user to focus on their more important tasks.

How it Works

Picking a Process

It’s important to remember that automation doesn’t cover all financial tasks (if only!), so consider that it will only help with processes such as:

• Menial tasks that you or your team are doing on a frequent basis, such as data entry.
• Tasks that don’t require adding a personal touch, such as a customer complaint/query that isn’t covered in your FAQs.
• Don’t require a level of creativity.

Finding the Right Tech

Your automation software needs to corroborate with your existing software/apps. There is a range of tech out there that contains built-in accounting automation features, meaning you won’t need separate automation software for the workflows/tasks.

Oversee the Process

While the software is designed to function independently, it is wise to assign yourself (or a colleague) as a stakeholder/point person to ensure all is running smoothly with the tech and to troubleshoot any issues that may arise. Remember – nothing is perfect!

Create your Workflow/Task

The software won’t create the workflow for you, so you’ll have to do it. How it works is you create a Trigger (a predefined ‘event’, such as an overdue notice, that will kickstart the automation – think of it like the domino effect), an Action (a response to the Trigger, such as an email reminder regarding the overdue payment) and finally a Result (the desired outcome, such as the client clicking the CTA to pay the invoice/contact the team).

The Pros of Automation in Accounting

Time-Saving

Naturally, this software saves time on tasks that would otherwise be done manually by yourself or a member of your team. For those using an external financial service, this will result in less billable hours, and for in-house accounting staff: increased productivity.

Less Errors

Manual data entry often leaves ample room for human error. In utilising the software with your other tools and apps, data can be automatically updated, ensuring that it is recorded correctly.

Tax Filing is Simplified

This software allows for you to track mileage, store receipts, track sales taxes, and maximise deductions, taking the sting out of the dreaded tax filing chore.

The Cons of Automation in Accounting

Technical Issues

A technical error for a lot of companies can be the crack that sinks the ship. Power outages, viruses, hacking, and incorrect use of the software all pose a threat to the productivity of using this tech for your business.

Fraud

All online endeavours aren’t 100% protected against fraudulent activity, therefore the business must diligently protect all financial information.

Incorrect Information

Software only runs as well as the person who uses it. If incorrect data is fed into the system, or software is misused, this can lead to errors in information and processing.

Conclusion

As the digital age continues to advance, we have to choose whether to embrace the tech that’s available to us. However, it is important to remember that no man-made resource is perfect, and that the value of accountant services is still undisputed. Accounting professionals are needed to analyse, interpret, and gather insights from data to help make better business decisions – skills that cannot be fully derived from technology.

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Take a look at our range of bookkeeping, accounts, and task-based packages to suit every budget. Alternatively, you can contact us, and we can create a bespoke package to suit your business needs.