The rise of small business (SMB) accountants as financial advisors to their clients has emerged in parallel with a surge of back-office software solutions. In part, these FinTech platforms have challenged accountants to remain relevant by acting as strategic advisors, and the technology has empowered accountants to do just that by automating tedious, time-consuming tasks and freeing up assets for accountants to take on that elevated role.
As SMBs embrace cloud-based platforms, data integration across those systems is an integral part of effective accounting solutions. This trend has also led to the surfacing of more challenges and opportunities for human accountants. While data integrations mean access to more data for financial professionals to analyze, they also raise issues in the world of compliance and data protection.
Jennifer Brazer, founder and CEO of virtual accounting services provider Complete Controller, told PYMNTS in a recent interview that data integration today is an integral part of the small business accounting world — and offers accountants an opportunity to further elevate their role as advisor.
“Data integration is key,” she said, “because every time you set up a new tool within your back office, if it doesn’t speak to the other tools, then you have one more thing to manage.”
A lack of data integration takes valuable time away from accountants’ advisory services, and pushes those resources to be spent on manual data entry and toggling between various platforms, rendering the purpose of such technologies — to automate those tasks — less effective.
For SMBs, the biggest challenge is often budgetary constraints. A business owner who decides to invest in a software platform may soon find themselves in a position where they need to spend more on experts who can manage the integration of that tool with the rest of the back office. Business owners must often choose between spending cash on advisory services or investing in the growth of their companies. Data integrations across platforms can make those advisory services more accessible and affordable to startups, Brazer noted.
Prioritizing data integration led Complete Controller to recently choose MoreReporting as its next product offering, a solution that integrates with QuickBooks to provide cash flow and financial analysis for users. The tool is imbedded with artificial intelligence (AI), a technology that Brazer said is quickly making inroads in the SMB accounting space — thanks to its ability to integrate across platforms, and extract data, regardless of source or form.
“Artificial intelligence is definitely the frontier; it’s definitely breaking into the space quite rapidly,” she said. “It’s taking over the mundane tasks of reviewing terms, handling transactional data, pulling data from various sources and putting it together into an intelligent form.”
Thanks to its data integration capabilities, AI is another tool that enables accountants to use more time as advisors — not data-pushers — for clients, she added.
New Challenges, New Opportunities
As the small business accounting space continues to evolve, this focus on data integration may be bringing accountants more opportunities to take on that elevated role of advisor. However, it’s introducing its fair share of challenges to accountants as well — challenges, Brazer said, that can also be seen as opportunities to further elevate the accountant’s role.
Today, the issues of cybersecurity and data protection are particularly important for accountants in the world of data integration.
“With everything being connected to each other, each individual product needs to bare the weight of making sure that their product’s risk is as moderate as possible,” said Brazer.
Yet, accountants have a responsibility here, too, she continued.
“As accountants, it’s our responsibility to make sure we are selecting the products that have already done their homework. They’re PCI-compliant, they’re HIPAA-compliant, they follow all ethical standards.”
Accountants must keep data protection, compliance and cybersecurity top of mind as they advise their clients on which products to use, offer products to those clients and embrace data integrations in the back office.
Data security in FinTech solutions will also be an essential component of encouraging the traditional financial services market to participate in an open ecosystem. In the U.S., though Open Banking mandates are not at play, the financial services shift to embrace data integration has led traditional banks to open up their systems, too. Brazer said Intuit has emerged as a pioneer in encouraging that bank participation, an important component of automation in the SMB accounting space that enables accountants to not only analyze bank data, but initiate orders like bill payments.
Banks’ willingness to embrace APIs and connect with cloud-based platforms is a sign that the industry is confident in the security and functionality of those data connections. If accountants are able to continue to step up to the elevated responsibilities of supporting data security for their clients, these professionals will continue to provide invaluable services to their clients.