Small businesses may struggle to adopt new technologies, but that doesn’t mean they don’t want their accountants out of the loop, too.
A new report from SME cloud accounting company Xero, in conjunction with World Wide Worx, found that South African small business owners want their accountants to have the latest technologies and warned that several technologies are critical for SME accountants and accounting platforms to stay relevant and retain customers.
“We are entering a period of rapid technological change within the accountancy profession,” reflected Colin Timmis, Xero’s South Africa head of accounting, in a statement. “From automation to artificial intelligence, accountants are having to upskill and evolve their offering.”
“The report has shown that South African accountants are preparing for change, but they need to ensure they’re clued up on the next big tech innovations and affirm their status as the SME owner’s most trusted advisor,” he continued. “If they can do that, the future looks bright, as 42 percent of accountants peg South Africa as the country to watch for future innovations in the profession.”
It’s an interesting statistic, with Xero finding that South Africa surpasses the U.S. and U.K. as the leading market for innovations in the accounting industry.
PYMNTS breaks down the rest of the data points that dot Xero’s 2017 State of Accounts report below.
93 percent of SME accountants admit they could add more client value with the spare time they have every day. As cloud accounting and other technologies help to automate the accounting process, accountants are sure to have even more time on their hands they could use for hands-on, value-added services.
87 percent of SMEs prefer accountants that are tech-savvy, and more than half (52 percent) say they believe the role of accountant will change in the coming decade. Nearly two-thirds of SMEs say their accountant is their most trusted advisor. At the same time, 81 percent of accountants say technology is critical to the accounting profession now and will be in the future as that profession evolves — with most noting that they will need special training in the coming years to adapt.
70 percent of SMEs say the speed of responsiveness is a deciding factor when choosing accountants and other key business partners, while 72 percent of accountants say technology has led to improved reactiveness and responsiveness for their profession by enabling real-time data analytics they can use to make faster advisory decisions.
65 percent of accountants say technology is very important for them to provide adequate services to their SME clients beyond compliance — meanwhile, nearly the same amount of small businesses themselves, 62 percent, say added value is an important factor when choosing their own accountant.
22 percent of accountants identify artificial intelligence as “intriguing,” with analysts highlighting the role AI will play in shaping the future of SME accounting. “AI is the new frontier for accounting technology,” concluded Xero CEO Rod Drury.
What all this means, Xero concluded, is that the “death of the 8-5” is coming. In many ways, that’s a good thing. SME accountants can work from anywhere, with most accountants telling surveyors that this increased flexibility will promote productivity and be beneficial to the work-life balance. Technology is critical to this flexibility, they added.
But with so many drastic changes to the industry, accountants need to brace themselves.
Most accountants say they aren’t worried about their futures and are working to accommodate the necessary skills they will need as new innovations enter the industry. Accountants are not ignorant to change: industry professionals agree the landscape has changed dramatically in recent decades. But with the pace of innovation accelerating, the evolution of SME accounting is sure to accelerate, too.
“Twenty years ago, at the beginning of my accounting career, we were updating financial records manually on DOS computers,” said Cindy Dibete, chairperson for the South African Institute of Professional Accountants, in a statement reflecting on Xero’s report. “Xero’s research has illustrated that, in 2017, the technological landscape is rather different.”
“Although technology poses several challenges for the profession, we shouldn’t panic: accountants aren’t going to become obsolete, and SMEs will still be in need of their services for years to come,” Dibete continued. “What Xero’s research illustrates is a need for a broader realignment of the accounting role: one that focuses on strategic and advisory functions as much as financial management.”