B2B Payments

Accounting Technology’s Impact Felt Far Beyond The Enterprise

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There is seemingly no end to the discussion of how automated accounting can improve a business’ performance. The market is on the cusp of a groundswell of adoption of these technologies, says Therese Tucker, CEO of accounting solutions firm BlackLine, after a long lull among mid-market firms.

The literature agrees that automated accounting streamlines operations within the accounting department. But Tucker recently explained to PYMNTS that greater traction in this space has implications far beyond the accounting department — and even beyond the enterprise itself.

The CEO said that these implications are about to be felt as the catalyst of adoption begins.

“Across the board, in the past, accounting has been very underserved by technologies because they’re the last to get budget,” she explained. “As a result, in various areas of accounting, quite frankly, it’s been really antiquated.”

“That downgrades the accountants’ job overall,” Tucker added. So, naturally, accountants within the mid-sized enterprise will feel the most immediate impact from automated accounting processes.

“There is going to be a massive shift to automating the things that are broken and to having accountants actually spend their time doing things that are truly interesting,” she said.

These professionals went to college, Tucker continued. They don’t want to be spending their efforts within the corporation manually entering data and generating spreadsheets; their talent and expertise can be used for more important things.

“The accountants can go and do really interesting analysis and research,” she said. “That’s going to be a value-add.”

Outside of the accounting department, however, other parts of a business will feel the effects of automated accounting — and the access of the financial data that goes along with it.

For example, Tucker offered, BlackLine has corporate clients that use its accounting automation solution for fraud monitoring. Companies have the ability to visualize massive troves of data from accounting processes and, therefore, the ability to identify potential inaccuracies or discrepancies.

Centralized data can also mean other parts of the company can monitor their own performance.

“The ability to get information to outside parties that need it, the ability to produce metrics — it’s a well-known fact that you can’t decide if something has been successful if you can’t measure it.”

From treasury management to sales teams, access to data from the accounting unit might offer guidance that was previously unattainable.

But Tucker pointed out that, even outside the enterprise, a company’s automated accounting tool will make its mark on other entities.

Take auditing for instance. The CEO explained that, traditionally, accountants would print out reconciliations and store them in binders; auditors would then take a sample of those reconciliation documents and match those against the general ledger.

“That is an unbelievably antiquated way of testing anything,” Tucker stated. “That’s an insane approach.”

Auditors can not only access financial data more easily when data is stored and managed on the cloud or electronically, but the reconciliation process is automated, making the auditor’s job much easier and fueling compliance within a company.

Or, the executive said, companies can use the financial data they house about their own businesses to compare their performance to other companies within the BlackLine system — whether they be of a similar company size, industry or geography. This is key to helping a company understand where they may be falling short against the competition.

“You can focus on areas where you’re not running quite as efficiently as you should,” Tucker stated. “To be able to compare your company to similar industries, similar geographies, companies of other sizes is huge.”

Over the last few years, adoption of automated accounting tools has been modest. Not only are companies reluctant to dedicate budget to upgrading their systems and struggling to get educated on the technologies available to them, Tucker explained that change management is a critical component of this shift. Simply put, people don’t like change — businesses typically don’t either.

But with so many players now recognizing the abilities of accounting automation — from accountants, to CFOs, to auditors, to fraud specialists — support for change is growing.

Tucker said that BlackLine has seen a sudden uptick in adoption of these technologies in just the last two years or so as a younger generation that has never lived without technology enters the workforce.

“These tools have been around for a while now, and they’re accepted by auditors and CFOs,” Tucker stated. “People understand that you need connected technology that can automate. That’s how you become a better-run organization, and it’s becoming more mainstream all the time.”

“As a result, people are far less resistant,” she said.

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