Corporates are being forced to rethink their approach to accounting as new technologies disrupt the way firms transact and manage financial data. But, tools like electronic payments and cloud accounting software are far from the only forces that alter the corporate accounting landscape.
According to Jotham Ty, CEO of corporate accounting software firm Gappify, the rise of an array of business models is one of the strongest factors behind the corporate accounting shift.
Fifty years ago, he recently told PYMNTS in an interview, a company would sell a table. Today, however, businesses are selling innovations like artificial intelligence, SaaS or gig economy services. Whether it’s a B2B or B2C service or product, these various models don’t necessarily present a clear sales strategy.
“That changes accounting,” Ty explained. “Accounting has to change with the technology that’s advancing.”
The CEO admitted accountants are often slow to innovate.
“There is a bit of a lag with accounting in terms of understanding what’s going on,” he said. “We accountants are typically slow to change.”
Another force keeping corporate accountants on their toes is the accelerated shift towards digitization. While much of the world’s organizations may continue to rely on paper-based, manual processes, Ty said that in California, where Gappify operates, businesses are actually much more embracing of digital solutions.
Reliance on paper “has changed dramatically in the last six-to-eight years” in California, he noted, adding that “there is still a good amount of documents that are not digital.”
Digitization of documents in corporate accounting is critical to the industry’s efforts towards automation, now considered a crucial capability for accountants to be more efficient with their time and reduce error. But, there’s a problem with corporate accounting technology providers promising “automation,” Ty said.
“The automation [solutions] that we have available on the market right now are what we call point solutions,” he explained. “They address very specific parts of accounting and, because they don’t span across all areas of accounting, they become siloed. You may have automation of specific transactions, but because it doesn’t synchronize with the rest of the environment, it’s not truly autonomous.”
Ty also out that even as adoption of cloud accounting software continues to rise in the enterprise, many platforms that automate various points of the accounting process still require human interaction to initiate.
“The traditional software model requires a user to operate that software,” he said. “When you look at what’s happening in accounting, when you drop into an office and look into an accounting department, everyone is working on their computers in some kind of software. So, does that really mean we’re automating transactions if we still have to be reliant on software to do things?”
Gappify’s answer to that question — or, at least, the beginning of an answer — is Alan, a bot which deploys robotic process automation technology to not only automate tasks within the corporate accounting department, but also to do so without a human having to initiate such automation. This type of technology can incorporate other innovations, like screen scraping and optical character recognition (OCR), to enhance its capabilities, while connecting into multiple points within the accounting process.
Ty admitted that overall, corporate accountants are quite excited about the tool, though there is a need for education to get professionals comfortable and familiar with the idea. Considering accountants’ common reluctance to change, it could take some time.
“This type of [bot] technology is just surfacing,” he said. “But, I think, to further advance this type of technology as a community, it would be great to have more innovators think about how we get ourselves detached from software.”
Because new business models continue to emerge and challenge corporate accountants’ abilities, accountants must eventually get up-to-speed with newer technologies that can help them to do their jobs — and yes, that means progress beyond digitized invoices and electronic payments.
“You don’t have to be in software,” Ty said. “Human accountants should be collaborating with different departments like marketing and sales to try to understand evolving business models. We should be able to program bots like Alan to do tasks, and it should just do it on its own. We’re educating our community and doing outreach to make sure that people understand what this means — both for specific tasks, and also in terms of what this means for our profession going forward.”