Widespread changes in client expectations, employment practices, and business processes, and how businesses operate now are a consequence of technology proliferation. The finance and accounting department, an essential cog in the wheel of any organization, has been drawn to technologies such as cloud, data analytics, business intelligence, and the like to transform their operations.
This business function has not been oblivious to the charm of technology. Centuries ago, accounting and finance operations used the abacus to keep track of calculations in business. Then came the adding machines such as the calculator to increase the speed of and accuracy of this department. Over the years, as technology matured, there came computing devices and accounting software. With time, the use of technology in finance and accounting has only increased.
However, today as businesses become distributed, markets become global, and revenue streams become more complex, organizations or individuals offering finance and accounting services have to also be technology experts.
Here are some compelling reasons why we feel so.
Digital Transformation has reached finance and accounting
If you thought Digital Transformation was only for large IT firms, think again. The rapid proliferation of technology and the business value it has delivered has augured the adoption of digital technologies to improve insights and aid better business outcomes. Since finance and accounting play a strategic role in supporting enterprise goals, it needs the support of technology to gain greater intelligence to support and drive important financial decisions.
Whether it is financial planning, budgeting, process efficiencies, transaction accounting like revenue accounting and receivables, payroll management, fixed asset accounting, etc. organizations need to make smart financial decisions. For this, organizations need to replace guesswork with data. Finance and accounting thus need digital-powered services and the assistance of robust data analytics to make smart and correct decisions that align with organizational growth goals. Technology can also help them make critical decisions correctly to support talent retention, sharpen productivity, improve sales, and drive compliance.
Technology investments further assist in integrated planning, forecasting, and creating robust reporting models that provide valuable insights to C-suite leaders to identify growth opportunities.
Transaction accounting needs technology assistance
Transaction accounting, the most basic and one of the most essential finance and accounting functions, records certain transactions that help to analyze and predict the health of a business. Managing payables, receivables and payroll can be considered some rudimentary elements of transaction accounting.
Given the complex business environment, organizations need their accounting functions to add greater value by delivering better insights within these financials. Strong business processes and robust data analytics capabilities can make transaction accounting more accurate, insightful, and productive.
For example, organizations can leverage data analytics to identify process gaps or loopholes in their general accounting processes. They can use analytics to identify asset performance and assess which of their fixed assets are performing well and which ones need help or should be removed.
With deep insights from analytics, organizations can improve their processes and refine their strategies to meet business goals and drive profitability.
Business reporting and MIS are essential for business success
MIS (Management Information System) and business reporting are important to finance and accounting functions that demand the setting up of useful processes and formats of reporting for each department. The inputs from these departments have to be collected and analyzed correctly to facilitate better decision-making at an organizational level.
Manual data entry for the same is not only time consuming but is also error-prone. And since data is the new oil and is crucial for driving the overall growth of a business, these processes have to be designed appropriately to serve the organization.
Employing business intelligence to improve business reporting and to design and support the right MIS formats considerably increase business and process efficiencies. However, domain expertise plays an important role here along with technical expertise. This is because reporting needs an appreciation of the roles of different teams and operations within the organization. Ultimately, the right intelligence leads to elevated business outcomes.
Risk advisory needs tech assistance
Given the evolving compliance and governance landscape and constantly shifting market dynamics, the regulatory landscape has become a minefield of sorts. Organizations need to manage risk and GRC requirements to improve their risk management capabilities. However, taking a siloed approach to governance, risk, and compliance (GRC) management often leads to elevated costs and increased financial burden.
Technology comes to the rescue here as well to alleviate this burden. Well-designed technology solutions can help organizations navigate this challenging GRC landscape. Technology implementations can provide a holistic view of the GRC landscape, including SoX compliance, to enable better decision-making, meet reporting obligations easily, and support risk mitigation strategies effortlessly.
Transform reporting obligations to business advantage
The tax management challenge can hardly be ignored as complex business transactions. Changing tax norms and evolving reporting requirements add to the tax management complexity. Technology can be a great support for organizations looking to simplify tax management, improve transparency, and manage reporting needs while being compliant with local norms. With sustained business growth being directly proportional to compliance and regulatory adherence, organizations need business processes that embed compliance into the enterprise lifecycle.
Additionally, technology can help organizations get deeper insights and help them identify, assess, and manage tax risks with greater efficiency. With deep insights into all aspects of business operations, technology can aid finance and accounting departments to build strategies that drive organizational adaptability and agility.
Transforming these reporting obligations eases the tax management challenge and helps organizations be on the right side of the law. It also unlocks business advantage by providing the right information and support.
Unlocking greater value from business processes
Unless your financial and accounting services partner is a technology expert, it is highly unlikely for you to get greater value from business processes. Partners with technology expertise complementing the domain expertise will identify redundant processes and capably design processes that can drive growth and unlock value.
The domain knowledge provides a deep understanding of business workflows while the technology expertise helps in designing agile and high-performance processes using the right technologies that provide intelligence to support decision making.
The growing complexities in the finance and accounting space demand technology to improve outcomes, align finance and accounting strategies to business goals, and drive robust decision-making.
As such, it is essential for finance and accounting services partners to also be proficient with technology and its various implementations. With this knowledge, it becomes easier to use the right technology that will drive impactful decisions and consequently improve business outcomes.
If you are yet not convinced about the same, connect with our experts to see the value that the right finance and accounting solutions can bring to your business.