Top 9 Innovations Accounting Businesses Should Adopt in 2024 and Future

According to Accounting Today, “The accounting software market will have a global value of $11.8 billion by 2026, according to new market research, at an expansion rate of 8.6 percent per year starting from 2018.”

Many modern businesses nowadays adopt and leverage new-gen software solutions to evolve into the accounting firms of tomorrow. Accounting software applications help automate repetitive and time-consuming tasks and redefine existing business processes. However, trends in accounting technologies keep changing from time to time.

Each new trend requires accounting businesses to switch from conventional accounting software to emerging accounting technology innovations. Without adopting these innovations early, no business can remain relevant and competitive in the long run.

They also need to come up with a detailed strategy to use new ideas in the accounting business to make more money, retain clients, and work more efficiently.

Accounting businesses must consider adopting these technological innovations without any delay.

Cloud-Based Accounting

• Cloud Accounting Software Market Size reached USD 8.19 Billion in 2023 and is predicted to grow at a CAGR of 9.8% during the forecast period 2023-2030, reaching USD 15.39 Billion by 2030. (Verified Market Reports)

Cloud computing has been transforming how businesses operate across different industries. Like other enterprises, accounting businesses must leverage cloud computing and switch to cloud-based accounting to stay relevant and competitive in the future.

The cloud-based accounting tools enable accountants to access financial data anytime and anywhere.

These tools further help accounting firms to facilitate constant collaboration between accountants and clients. They can access financial data and work on the accounting apps using any device with internet connectivity.

Moreover, businesses can easily upscale or downscale their resources depending on the requirements without making a huge investment.

Accounting Software Integration

• According to Flexi, 67% of accountants prefer cloud-hosted accounting solutions over on-premise accounting software. (Flexi, 2021)
• Cloud-hosted accounting software decreased operating costs by up to 50%. (Flexi)

Accounting operations rely on different tools. For instance, they can use specific software solutions to manage invoicing, process payments, handle payroll, track inventory, and manage financial reports. Traditional operations adopt manual entry from one app to another.

However, no accounting team can beat the competition without such a tedious approach. Integration between all software can automate information sharing and add pace to the overall process. Along with that, the chances of errors are also significantly reduced.

One example is integrating QuickBooks software with Drake Software to import seamless accounting data for tax filing of returns. As the manual entry work is eliminated, the accuracy is increased by manifolds.

Digital Currency

Digital currency, such as cryptocurrencies like Bitcoin or Ethereum, presents opportunities and challenges in the accounting sector. Moreover, it offers the potential for streamlined transactions, reduced fees, and increased transparency.

Accounting firms must help businesses record digital currency transactions like other financial transactions. However, they must invest in next-generation accounting software to record digital currency transactions at the prevailing exchange rate and report capital gain tax at the appropriate rate.

Blockchain

• By 2027, the worldwide Blockchain market in accounting is anticipated to generate over $94.0 billion in revenue.

Blockchain is no longer restricted to digital currency transactions. Many businesses leverage blockchain to record financial transactions in an open, digital, and secured ledger. In addition to keeping financial transactions transparent and auditable, blockchain further makes the transaction records accessible to authorized users anytime and anywhere.

Accounting firms may even go for custom software applications to use blockchain for several purposes – accelerate fund transfer and financial transactions, record financial transactions accurately, reduce account receivables and payables, and facilitate auditing. The custom software applications can be customized according to specific use cases.

Optical Character Recognition (OCR)

Accounting businesses can manage clients’ finances more efficiently by integrating the right accounting software. However, they cannot make the accountants more productive by reducing the manual entries required to record various financial transactions.

Optical Character Recognition (OCR) technology enables accounting firms to automate and accelerate manual entries. Accounting firms must leverage OCR technology to convert textual information to digital files using scanners and mobile device cameras. One of the popular solutions is free OCR tool that will not only save firms cash but also help them perform quick & accurate text extraction.

Artificial Intelligence (AI)

• The market size of AI in accounting is expected to grow at a CAGR of 33.5%, from USD 1.56 billion in 2024 to USD 6.62 billion by 2029.

In a conventional working environment, accountants put extra time and effort into analyzing and reporting historical financial data. They even facilitate decision-making by calculating various financial ratios and generating elaborate reports. Artificial Intelligence (AI) makes it easier for accountants to accelerate and simplify data-related tasks – bookkeeping and transaction coding.

In addition to automating repetitive tasks, AI will further enable accountants to deliver functions of higher value, such as business strategy implementation and financial advising. AI technologies even have the potential to transform accounting firms completely.

AI helps to create a comprehensive report by extracting financial information from various resources. It improves the visibility of spending patterns, earnings, and more by offering tools to track changes in business finances.

Machine Learning (ML)

As a subfield of AI, machine learning detects patterns by analyzing a large amount of data using algorithms and statistics. Accounting businesses must leverage machine learning to simplify and automate categorization and validation tasks.

For instance, an accountant can use machine learning techniques to check if an additional expense is relevant or not by analyzing a large set of expenses. Many accountants believe that AI and machine learning will automate their tasks completely. However, accounting businesses can leverage these disruptive technologies to make their accountants more productive.

Robotic Software

According to Gartner, 66% of CFOs expect to spend more time on RPA and other workflow automation technologies.

Many accounting firms are currently using robotic software to reduce operational costs by automating repetitive tasks.

However, the use cases of robotic software will differ across accounting businesses. Most accounting firms will need customized robotic software to perform a variety of transactions – entering financial data, saving the financial data in relevant formats, generating reports, and performing tax operations – quickly and accurately.

Next Generation Mobile Apps

Most accounting firms nowadays allow employees to bring and use their own devices. The bring-your-own-device (BYOD) strategy enables accountants to access financial data and record transactions anytime and anywhere using their mobile devices.

Recommended Reading: Mobile Accounting: All That You Need To Know

However, no accounting firm can secure financial data without implementing a comprehensive mobile security plan. They need to build custom mobile apps that leverage cloud computing and focus extensively on data security. The app also needs to include features to enable authorized employees to access sensitive financial data by eliminating the impact of emerging security attacks.

In Conclusion

Overall, the trends in accounting technologies keep changing from time to time. Each new trend makes conventional accounting software obsolete and requires accounting firms to switch to the latest technological innovations.

Accounting businesses must maintain a robust strategy to monitor and adopt emerging trends and technology innovations in a timely and proactive manner.

What latest technologies have you adopted in the accounting business that helps you drive innovation? Do let us know in the comments.