Most accountants by now have received the memo about cloud accounting. Software is changing, and it will have an enormous impact on the way accountants work.
Although most accountants have at least a handful of clients on cloud accounting software, firms are reacting in fits and spurts to what this means. Many are failing to fully embrace the new generation of business models that exploit the advantages of cloud.
In conversations with accountants on the journey to the cloud, the impact of these errors varies from regression to outdated methods, million-dollar blowouts and staff and partner attrition.
There are several recurring patterns in these failures. I have pulled together the five most critical (and most common) mistakes accountants make when transitioning to cloud accounting, along with ideas on how to avoid them.
You can download a free copy of the 17-page report right here.
Why are accountants making these mistakes? Attitudes are slowly changing but too often accountants still believe that the change required is incremental.
I can’t count the number of times I’ve heard the line “cloud software is just hosted on a remote server” from older generations. Sorry folks, this is not just a rerun of bureau computing.
The landscape changed dramatically 20 years ago with the introduction of desktop accounting software. The impact of online accounting will be just as great.
Not convinced? Consider these drivers for change, both internal to accounting and in the broader world.
Everything is connected
The internet is connecting everything. Not just point of sale to the general ledger, but the infrared beam that counts how many people walk in and out of the store. Anything imaginable can become a source of data that can be tracked, measured and analysed to improve business performance. The Chartered Accountants Association of Australia and New Zealand is already redefining the future of the profession in data analysis rather than just financial. They didn’t teach you this stuff at accounting school.
Life is mobile
We are rapidly transitioning from an office environment where the desktop PC was the primary interface for work. Mobile is still a secondary interface for some tasks but this won’t be true for long. Software automation, artificial intelligence and integrated voice recognition are combining to carry out tasks we used to perform manually on a keyboard. Clients’ staff can snap images of receipts instead of the shoebox, and business owners can check their KPIs on a dashboard on their iPad. Is your firm promoting or ignoring this way of doing business?
Government is digital
Governments around the world are seizing on digitisation as a way to slash costs. Trends set by Denmark, Norway and others, where personal tax returns are automatically calculated, are spreading to other parts of the developed world. The UK is heading in same direction and Australia is following. In New Zealand tax returns will soon to be pre-filled with payroll data by the tax department.
Clients are changing
The internet has hooked younger generations on 24-hour access and real-time results. The new breed of business owners have very different expectations of customer service. They don’t see compliance as an end result but a ticket to the game. Generation Z cares more about experience, ease, personalisation and aligned values. Millennials are focused on price and competitiveness. Both signs that firms can no longer expect the high customer retention rates of previous years.
The single ledger
Accountants no longer need to import data from the client’s accounting file to their practice management suite. Accountant and business owner now work on the one file, the single source of truth, to make it as accurate a representation of what’s happening inside the business.
Not only does this cut down the back and forth, it transforms accounting from historical reporting to taking a live pulse. From a diary to a Fitbit, if you like.
In short, there’s a hell of a lot going on. No wonder then that many accountants aren’t sure of how to respond. Download the free 17-page report to read about five critical mistakes accountants are making in cloud accounting and ideas on how to avoid them.