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ECONOMY AND FINANCE
7 Accounting
Trends Will Affect
CPA Firms in 2020
BY ROBERTO G. BELINGUERES Developing technologies and the
advent of innovations in the world are boosting economic growth at a global level. Accounting, too,
plays an important role in any business as well-organized accounting operations can provide accurate, relevant, and valuable financial information, leading to better business decisions and desired growth.
As 'change,' in this modern & technology- driven business world, has become essential for growth, CPA firms also need to become aware of the latest accounting trends, especially the firms that often reshape their business model and processes.
Let's get straight to the trends emerging in the accounting industry.
1. Switching to Cloud-based Software
Cloud computing has already made its place prominent in accounting. By adopting this impressively trending technology, accountants can establish their firms as leading brands that provide up to the mark CPA accounting services.
QuickBooks Online, FreshBooks, Xero, and Kashoo are some accounting applications that are commonly used worldwide. 67 percent of accountants prefer cloud accounting (Sage Practice of Now 2018 report).
By 2020, 78 percent of small businesses will rely solely on cloud technology (Accountancy Age).
2. The Adoption of Automation
Automation is transforming the way work is done in the accounting industry. As an example:
• Bookkeeping time can be reduced to half as most cloud-based accounting applications automate 80-90 % of transactions.
• AP automation can save $16 per invoice or more, depending on the size of your company (Vanguard Systems AP shocking stats).
• Accounts payable professionals who automate invoice capture and payments save an average of one hour per day (MineralTree).
By 2020, labor-intensive tasks like tax preparation, audits, and banking will be fully automated according to a Forbes Study.
3. Potential of Internet
High-speed internet connections made the concept of video conferencing possible. Utilizing the internet at its best allows bookkeepers and CPAs to have two-way conversations with colleagues and clientele.
There are many applications for face-to- face virtual interactions; they give a clear picture of what to expect soon – advanced features for live video conferencing.
The number of internet users worldwide in 2019 measured 4.388 billion, up 9.1% year- over-year.
4. The Era of Millennial Clients
The future will see the young generation taking the lead in most aspects of almost everything. Many current and likely to be business owners are willing to go beyond standard business approaches and systems. Paperless accounting is the exact reflection of what young CEOs and accountants wish to see in the coming decades.
The era of millennial clients literally means that accountants need to handle completely different types of clients who prefer a greater level of proactiveness, enhanced operational transparency, and personalized approach.
5. Competition is Increasing due to Corporate Bookkeeping Firms
Since many third-party bookkeeping service providers have adopted the revolutionary accounting applications with automation features, CPA firms are likely to see tough competition in the market.
Moreover, these services will also affect the firms that offer advisory services too. These days business owners prefer advises from someone who manages their numbers.
30% of small businesses place accountants at the top of their list of trusted advisors (ICAS).
6. Changing Roles of the Accountant
About a decade ago, accounting aspirants needed to be experts in mathematics and have a complete understanding of laws and
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