Accounting has always been resource-heavy, labor-intensive, expensive, and time-consuming. Most accounting processes involve having to investigate extensive volumes of data. Additionally, the proceedings have to go through various compliance and legal checklists and bottlenecks.
However, with advancements in technology, today most of the labor-intensive manual elements can now be automated – 75% to be more precise. Automating allows accounting systems to crunch numbers, identify discrepancies, and track transactions in real-time – with minimal human intervention.
Let us dive deep into the benefits of Automation of Accounting and Audit processes:
The benefits of Automating the Accounting and Auditing Processes
1. Reduced Time
One of the most tangible benefits of automating the accounting process is the time saved. This holds especially true during financial closing – wherein the system reconciles the numbers without human intervention.
According to Gartner, Robotic Process Automation (RPA) in accounting, in particular, can save finance departments 25,000 hours of avoidable work annually. As a result, what normally took several weeks can now be done in a matter of minutes. This allows CPAs to focus on mission-critical tasks and strategy instead of rote work.
2. Data accuracy
When working with large corporations and struggling with massive quantities of data, human error is all too common and unavoidable. Automation of accounting process makes it possible to create thousands of error-free ledger entries with minimal human intervention, eliminating the chances of data duplication and errors.
3. Secure file storage
Government regulations necessitate having to store paper records for anywhere between 7-10 years. However, governments worldwide are embracing the idea of digital copies of documents instead of hard copy paper files.
This means the software upon receiving a document, say an invoice, can now process it instantly by entering the data and automatically storing the proof of purchase in the appropriate folder and in the required format.
This makes every document accessible no matter the physical distance from the firm. This eliminates having to rifle through filing cabinets.
4. Simplified data retrieval
Prior to servers and spreadsheets, there were rooms full of hard copies of files. Information retrieval required physically searching for the file.
But with Cloud-based accounting, employees can access accounting software, processes, and files 24*7. For instance, when the employees are traveling or at a client’s office and need to check a document or process a payment, the cloud is here to save the day. This eliminates the need to be physically present to access the pertinent file as everything required is waiting online.
This allows auditing at different locations to go smoothly as all the pertinent data is accessible with a few clicks.
5. Real-time integration
Staying relevant in the landscape of industrial revolution 4.0 requires digitization. No two ways about it. The more company processes can be digitized the better these solutions can be deployed.
For instance, integrating a company’s payroll tool with the accounting platform allows the latter to receive information from a spend management software. This eliminates having to copy information, offering up-to-date, consistent, accurate data across multiple platforms.
Additionally, automating the auditing process allows for data to be processed and interpreted in real-time and compared against past transactions minimizing chances of error.
With automation enabling accounting systems to be cloud-based, all finance processes are also turning cloud-based. This allows them to interact and provide the best interpretation of data.
6. Professional development
Automation of accounting process must be viewed as an opportunity for growth. Automation will not accomplish everything and the process requires competent, skilled accountants to drive the software and interpret the results.
85% of accountants believe that to gain a competitive edge in the market, they need to keep up with the pace of technology adoption.
Despite high levels of automation and AI, no machine will come close to recreating the value and judgment of a skilled accountant. Automation of accounting process will provide avenues for skilled accountants to share their judgment, enriching the employment experience.
When deployed masterfully, accounting automation will eliminate all the labor-intensive and frustrating parts of the job. This leaves plenty of room for an accountant’s value-based addition such as management accounting, strategy, and excellent communication.
Growing professionally today requires being aware of and proficient in various accounting automation tools.
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