How Modern Technology Is Changing The Field Of Accounting

Accounting and bookkeeping both are very crucial for an organization as both deal with keeping track of money which flows in the organization. All firms, whether it’s a small one or large one, should start adopting modern technology. Charles Darwin survival of the fittest theory. A lot of people feel that using modern technology will take replace humans. But it is not at all true. There is no machine present till date which can depict the emotional intelligence present in humans.

There are a lot of modern technologies which are currently in the market today and they have completely changed the way in which a lot of conventional industries used to function. So, the impact of different technology is different on an organization. Let us look at the various technologies impacting the accounting industry:

  •  Artificial Intelligence and Machine Learning

Artificial Intelligence and machine learning are both the most dominating technologies and have impacted all the industries. It has also impacted the accounting industry. With the use of chat bots and automated data entry tools, using artificial intelligence is becoming very easy for accountants. The co-founder of Microsoft, Bill Gates feels that AI bots will be good for both the society as well as accounting firms. They will save time, reduce cost and will provide better accuracy. AI enables computers to perform decision-based tasks. This improves the data analytics ability of the machine. Machine learning helps the machines to learn through human behaviour with the help of various algorithms and this improves decision making and efficiency. Various accounting tasks such as auditing, clearing invoice payments, analytics calculation and invoice categorization can be carried out using machine learning and artificial intelligence. At Deloitte, auditors access AI tools with natural language processing to interpret various contracts or deeds.

  • Cloud Computing

Cloud computing deals with storage of data in secure data centres which can be accessed from anywhere. A perfect example of cloud computing shall be using Google Drive.

With the help of cloud computing a company reduces operating costs as no expensive computer equipment and servers are required to be installed in the office. Cloud computing allows invoices to be to be scanned and automatically send to the accounting system on a daily basis, where the accountant can check and confirm the entry. This saves the accountant to do the monotonous work which might reduce efficiency. This also reduces the cost of bookkeeping services and also saves time and money for accountant. Many accounting software’s are present on the cloud.

Read More: What is Cloud Computing in Accounting?

  •  Big Data

It is predicted that by the end of year 2020, more than 50 billion devices shall be connected to the internet. All the data which is being generated has to be managed. This is where big data comes into play. When technology meets any industry, data shall be generated. Accounting industry is no exception. Big data has a huge impact on accounting industry. Big data produces more data driven audits which is good for both the client as well as the auditor. Big data helps in building analytical models to identify tax related opportunities, helps in monitoring and improving business performance and also helps with risk identification and management. Big data provides both descriptive as well as predictive analysis which helps the firm to forecast or predict the future of marketing and investment. It also provides the business the benefit of data visualization. Data visualization provides a graphical appearance of the data which makes it very easy for the user to understand the trends in the market.

  • Internet of things

Internet of things refer to a network of things where things may be sensors, physical devices, actuators. There will be a lot of changes which we can expect from I.O.T. in the accounting industry. I.O.T. will automate the whole process of accounting happening in the industry. CPA’s shall automatically receive all associated data though digital systems which will save the time to go to a bookkeeper. This will completely create a revolution in the way in which accounting is done. With IOT implementation, CPA’s shall also gain access to real time data as data shall be recorded from the sensor and directly shall be received by the device through internet. The real-time data collection shall enable the businesses to respond to real time issues immediately. This also helps the accountants to minimize losses.

As we can see, modern technology has impacted accounting programs in a very positive way. It has improved functionality, accuracy, decision making, processing and external reporting and all these factors are very crucial for accounting. The benefits are very clear and from the starting itself computers when integrated with industries have helped industries a lot.

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