Basic Building Blocks to Enabling Collaborative Accounting

Hey fellow accountants! Wanna read a joke?

Microsoft & Ferrari once partnered to build next-generation computers. The mission was to fuse speed with high-performance computing. The shimmering product was unveiled in an anticipated product launch. The curtains were pulled… and officials started the engines (system).

The engines started with a roar. Everyone started applauding. But wait! The frenzied computer started to sputter. It raced out of the podium, tumbled after making spins, crashed into the wall, and bang – blew out of existence. That’s what happens when best of tech behemoths don’t prioritize integration and collaboration in their work.

Not so funny right! Still the loveless relation of Microsoft and Ferrari holds a valuable lesson for accountants – tech without integration and collaboration crumbles.

The accounting sector is also marching towards the dazzling technology realm with a view to bringing about untold future capabilities and utopia. However, in the process of acquiring tech stack most accounting firms are undermining integration. They are making their ecosystem complicated.

As a result, different departments are failing to exchange data on time and collaborate effectively for better output. Silos between accounting systems obscure profitability.

How Big Firms Like KPMG are Doing it Right?

KPMG deployed automation — vouching tools now simplify the process of reading complex contracts, parse invoices and automate procedures that were manually tedious. The KPMG worker simply goes to the site and scans the unit the scanning glasses (fed on augmented reality) to prepare an inventory ledger. Another amazing KPMG differentiator is the ability to parse 100s of invoices in few minutes for preparing the general ledger. The most amazing part of this success story is that every function and every system is connected and coordinated from start-to-end in an order.

Others Must Follow to Stay Relevant

“The archaic days of accountants telling “send me the papers, I will look into it” are gone. Accounting firms still running on paper-based processes will drift into the abyss of obsolence. They need to befriend technology as a powerful ally.”

              — Randolph P. (Randy) Johnston, MCS

The KPMG success story is centered around data, automation, and integration. In the future, more accounting firms will be able to make this possible. However, doing this will require tact and a long-range strategy. Here is how next-gen accountants are emboldening their practice with collaborative accounting:

• Step 1: Smarter CPA or accounting firms have intelligent workflows which guide all their firms’ actions since the time he/she is turned into a lead and onboarded into the practice.
• Step 2: Strong integration layers between each department ensure that all functions are closely connected, collaborated and coordinated. ERP, CRM and all other financial systems have the nimble flexibility for responding to the legal updates and make changes.
• Step 3: As the process flows forward, notifications alert customer support teams to take the hand-off from sales.
• Step 4: Automation of tailored document request list allows them to bring data faster from client systems. It becomes easy to create returns, import/export workbook data, and complete filing of extensions.
• Step 5: Next, advisory team jumps in to find new outsource data verification or uncover new opportunities.
• Step 6: Going forward, the review team reviews findings. All the work is then assembled and sent to client again for approval.
• Step 7: In the final stage, e-filing is completed. The best part is that all these flows are connected end-to-end.

Essential Building Blocks to Collaborative Accounting

Forward thinking firms want to reap the benefits of collaborative accounting. However, they need to clear the groundwork and build strong foundations that unite all functions on one single mission. Here are some essential building blocks to collaborative accounting:

Data

Collaborative accounting primarily hinges on data. Data needs to be gathered from multitude of data sources that include quarterly reports, budget plans, financial statements, and real-time data feeds, among others. This wealth of information becomes the foundation for businesses to explore a range of opportunities that lead to better financial outcomes.

Cloud Computing

Cloud is the lynchpin that moves collaborative accounting. It grants the ability to store and share data remotely, which allows for greater efficiency and accessibility between team members, regardless of their physical location. Not only does the cloud provide a platform for real-time communication, but it also allows for secure access and data backup, reducing the risk of potential data loss.

IT Integration

Another pre-requisite is integration between IT systems. With integration, the systems can communicate with each other seamlessly, allowing for real-time data transfer, automated processes, and reduced manual intervention. In addition, integration can lead to improved decision-making capabilities, enhanced visibility, faster client onboarding and accelerated response to business needs. A study by Gartner has found that companies investing in IT integration see up to a 30% increase in workflow efficiency and productivity.

Analytics

Through a comprehensive analysis of data collected from various sources; accounting firms gain a deep understanding of the underlying factors impacting process efficiency. They can utilize this information to make data-driven decisions to optimize processes. Given the increased semantic richness, the implementation of analytics helps CPA firms identify efficiencies and eliminate inefficiencies, ultimately driving overall business success.

Training & Development

Despite the undeniable benefits of incorporating new technologies into accounting practices, it’s crucial to recognize the inherent resistance to cultural change that may arise. To mitigate this resistance, thoughtful and proactive communication is necessary to clearly outline the benefits of new technologies and assuage any concerns or apprehensions that may arise.

Additionally, involving the accounting teams in the decision-making process and empowering them with the knowledge and tools needed for success can go a long way in fostering a positive and supportive cultural environment that is receptive to new age technologies.

Read more : Introduction To Cloud Accounting

Final Words

Creating a conducive ecosystem for collaborative accounting is easier said than done as there are several moving parts to it. The most significant obstacle to overcome is the presence of silos between departments. A comprehensive and informative approach, backed by relevant data, is necessary to tackle this issue effectively.
Apart from this, understanding and knowledge of the accounting field and related execution strategies is important.
That’s the area where ACE Cloud Hosting specializes. Know how leading CPA firms are building capacity for collaborative accounting.

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FAQs 

What is Collaborative Accounting? 

Collaborative Accounting is a process that involves the sharing of financial responsibilities and duties among multiple individuals or departments within an organization. It involves open communication, transparency, and collaboration to ensure that all stakeholders are aware of the financial situation and contribute to decision-making processes.
Collaboration in accounting helps to improve efficiencies, reduce errors, and ultimately, drive better business decisions. By sharing financial data and insights, stakeholders are empowered to make informed decisions that benefit the organization as a whole. 

Can Collaborative Accounting Speed Tax Filing? 

Collaborative accounting has been shown to be effective in enhancing the efficiency of tax filing processes. By pooling resources and expertise, teams can streamline the preparation and submission of tax forms, resulting in expedited turnaround times and reduced errors.

In addition, working collaboratively promotes transparency and accountability, leading to greater accuracy and confidence in the final filings.