Accounting trends in 2021

With the incoming of the year 2020, the world has seen many changes. Although the changes were not as great as what was expected by most of us, the change in the technical world has started the beginning of a new futuristic world. We are currently seeing an upsurge in technological advancements and automated functions.

Added to it, technology has not only touched the accounting world but had jolt started it to function as per this new world. We are rapidly moving in the accounting industry with advancements and technical fixes on even areas like cloud-based subscriptions, on-premise solutions, Software as a service (SaaS), and more.

Drive towards Industry Change

As per a worldwide survey based on the answers of 3000 accountants in 2019, a stark percentage (around 90%) believes that the accounting industry is going to enter in a cultural shift by the next decade. Moreover, the effect of such a shift has started to come to the light in the form of:

i. Toward emerging technologies
ii. Business services
iii. Hiring practices
iv. Work from home practices

A fact has also come to the light from the same above highlighted survey that more than 82% of accountants are thinking to recruit new employees from a non-traditional background. Even a number as high as 62%, the current respondents believe that the accounting training programs of today won’t be enough to catch up to the accounting trends of 2030. 

If the above facts are intriguing, we have more for you. So, let us take a look at a few interesting accounting trends that are forecasted to shape bigger accounting ventures.

1. Cloud-Based Accounting

Accounting services and cloud have become inseparable amigos and no doubt, a profitable entity for most businesses. With the accounting systems hosted on the cloud, a majority of companies have gained the ease of accessing their digitally hosted system anytime and from any place. 
The data access is not just limited to the ‘Read Only’ versions but also gives you the benefit of sharing, editing, copying, and working on the files collaboratively. Added to this, with the help of the data access facility, you can also track:

  • Expenses
  • Sales
  • Inventory

In fact, Sage has also published a report “The Practice of Now,” where 67% of accountants approved the introduction of cloud-based solutions to have streamlined and enhanced the work quality.

Cloud-Based Accounting

Another survey from Accounting Today highlighted how already 58% of organizations have recognized the benefits of shifting to the cloud and are using cloud-based accounting systems. You can already see the supported answer in the form of the above graph.

2. Offshore Staffing in addition to Remote Work Setup

Even before the attack of the current pandemic, CoVid-19, Forbes had called attention to the fact that more than 34% of the American citizens were indulged in remote working. When the numbers were calculated, they stood out to be close to 4.7 million. The statistics shared by GetApp also showed how the number of remote workers had drastically increased to 40% if calculated weekly.

Remote Working Setup

Reports from the US Bureau of Labor Statistics (BLS) highlighted a 2% accountant unemployment rate in the second quarter, which further grew to be 3.5%.

Even though the requirement is high, the unemployment rates have been high:

i. Auditing clerks – 1.5%
ii. Accounting clerks – 1.5%
iii. Accountants – 1.4%
iv. Bookkeeping clerks – 1.5%
v. Financial analysts – 3.2%
vi. Auditors – 1.4%
vii. Financial managers – 1.5%
viii. Posting and billing clerks – 2.0%

Due to this, top accounting enterprises are missing out on talented accountants and the chance of employing them.

To avoid missing such opportunities and bring in more profit to their organizations, accounting leaders are encouraging and implementing more technological changes. And the classic example that comes to the surface is a remote work setting.

A majority of us belonging from the accounting world will come to an agreement that embracing remote working in addition to the digitalized accounting systems has cut down most of the expenditure. Aside from it, it has also optimized the entire progression.

Moreover, the addition of offshore staff directly deployed in remote working settings is hiking up the growth trajectory. Implementation of this by many accounting firms are aiding them in reaping more benefits than the normal (traditional) working structure. So, based on analysis and forecast, this setup trend will expand and flourish in the years to come.

3. Accounting Software

The current accounting market is going through fierce competition. With a majority of software migrated to the cloud platform, the requirements to use that hosted software has gone up the chart. More and more businesses are opting to adopt cloud-based accounting software solution on their business requisition due to more:

  • Friendlier functions
  • Advanced features
  • Robust solutions

Accountancy Age shared suggested their perceptions that from 2019 to 2024 the accounting software would take over the accounting industry. The forecasted CAGR growth rate will also jump around 8.5%. the amount, when projected numerically, stands to be around $ 19.59 billion.

Use of Accounting Software

A few of the accounting software which are going to take their places as the trending accounting software are:

  • QuickBooks
  • Xero
  • FreeAgent
  • Sage Business Cloud Accounting
  • Gusto

4. Big Data

Big data has always been the preference of financial experts and accountants whenever it comes to resorting to crucial accounting task completion. Acting as a support form of expanded assessment methods to accounting firms and organizations, big data has been silently working behind the scenes.

This technological form is imperative in transforming vital internal data sets into dynamic, secure data analysis. Added to it, it has also been a constant aid to convert those evaluations to that of actionable insights. With the gradual but constant advancement in this accounting industry, the probability of big data becoming more proactive in nature is pushing in the future trends.

Big Data Adoption in near future

5. Data Analytics

Compared to the opportunities and promises made by Big Data for financial experts and accountants, the forecasts are even regarding data analytics. On inculcating data analytics to your accounting firm, you can avail advantages in the form of:

  • Identifying operational inefficiencies
  • Developing accurate forecasting models
  • Collecting valuable financial insights
  • Tracking clients progress

To segregate various service values from contenders and make judgments based on accurate decision-making, graduality a majority of industries will be embracing data analytics by 2021.

To strategize on better advisory businesses, the demand for data specialists would go higher in the coming years. The reason for this statement depends on two factors:

  • Interpreting complex datasets
  • Capturing valuable insights

Added to this, conventions and guidelines for responsible data gain will also see a radical upgradation by 2021.

Well, these are a few accounting trends that we are definitely hoping to see in the coming years. The starts of the accounting industry seem to shine brighter in the professional world. The best aspect of these trends is that they are moving slowly but steadily and is definitely bringing a revolution in the field of business.

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