BCAS Vice President CA Chirag Doshi’s Message for the Month of April 2023

Momentum in Technology Adoption by Professional Firms

Introduction:
Professional firms play a critical role in helping businesses manage their finances and navigate complex financial regulations. As businesses continue to face ever-changing financial challenges and opportunities, Professional firms must adapt and innovate to stay ahead of the curve. To gain momentum in this competitive landscape, accounting firms need to leverage the latest technologies and business practices to enhance efficiency, improve decision-making, and provide better value to their clients. By investing in tools like Business intelligence, Cloud computing and Artificial intelligence.

Business Intelligence:-
Business intelligence can provide significant benefits to professional firms by helping them to gain competitive advantages in several ways:

Data driven decision making: Business intelligence tools can help accounting firms to analyze and interpret data more effectively, which can lead to better decision-making. By using business intelligence, accounting firms can gain insights into their clients’ financial data, identify trends and patterns, and make informed decisions based on data-driven insights.

Financial Analysis: BI tools are used to analyze financial data and identify trends, such as revenue growth, cash flow, and profitability. This analysis helps firms make data-driven decisions about investments, cost reductions, and other strategic initiatives.

Forecasting and Budgeting: BI tools enable accounting firms to forecast and budget more accurately, by identifying key drivers that impact financial performance. By using BI, firms can create more accurate financial models and forecasts.

Client Reporting: BI tools can be used to create customized reports for clients, which provide insights into their financial performance. These reports can include visualizations, such as charts and graphs, to help clients understand their financial data more easily.

Fraud Detection: BI tools can be used to identify patterns in financial data that may indicate fraudulent activity. This helps accounting firms detect and prevent fraud, which can be costly for both the firm and its clients.

Internal Management: BI tools can be used by accounting firms to monitor their own performance, by analyzing data such as billable hours, staff utilization, and profitability. This helps firms optimize their operations and improve their overall performance.

Cloud Computing
A 2019 survey by Accounting Today found that nearly 60% of professional firms were using cloud-based accounting software, and that number is expected to continue to rise.

Cloud computing can benefit accounting firms in various ways:

• Accessibility
• Scalability
• Security
• Cost saving
• Automation

AI for Accounting
Accountants and Chief Financial Officers (CFOs) agree that artificial intelligence software is one of the new technologies that will shape the industry’s future.

20% Accounting firm now invest in and use AI

Another 20% have planned to use AI in another 12 months

47% of CFOs think that the COVID-19 pandemic has sped up digital transformation and increased the use of new technologies like AI, machine learning, blockchain, and automation.

Agile Accounting
Agile accounting is a modern approach to accounting, which emphasize collaboration, flexibility, and customer value.

The goal of agile accounting is to provide real-time financial information that is accurate, relevant, and timely, so that organizations can make informed decisions quickly. This approach allows businesses to respond to changing market conditions and adapt to new challenges more efficiently.

Some of the key features of agile accounting include:

Continuous accounting: In agile accounting, the accounting process is continuous, rather than being performed at specific intervals. This allows for faster and more accurate financial reporting, and reduces the risk of errors.

Cross-functional teams: Agile accounting involves cross-functional teams that include not only accountants, but also other stakeholders such as product owners, developers, and project managers. This allows for better collaboration and more effective communication.

Adaptive planning: Agile accounting involves adaptive planning, which means that financial plans are continually updated based on feedback and changes in the business environment. This allows businesses to respond more quickly to changing market conditions.

Value-based accounting: Agile accounting focuses on measuring and reporting on the value that the organization is delivering to its customers, rather than just focusing on financial metrics. This helps businesses to prioritize investments and make more informed decisions.

Post the COVID 19 pandemic, many businesses began to re-imagine how they could perform services in a remote way. Professionals should not lose the momentum gained by this technological change; our increased responsiveness and high quality services shall continue to inspire new operational models.