Every sector in the business world has its unique challenges. The accounting industry is no different. Accounting firms have challenges ranging from tax rule changes and succession planning to staffing challenges, cybersecurity, regulatory compliance, and more.
But, what challenges are the most pressing for Accounting businesses like yours?
Before we look into the most significant issues affecting the field, let’s look at a few important numbers.
Key Accounting Industry Statistics and Facts
In their own words, here are some informative statistics from Sage, Fintech, and The Accountancy Partnership.
- “91% of accountants say that accounting technology has increased their productivity” (Sage)
- “80% of firms have seen an increase in cyberattacks and attacks targeting home workers rose five-fold in six weeks since lockdown” (Fintech)
- “83% of accountants believe that to gain a competitive edge in the market. They need to keep up with the pace of technology adoption” (Sage)
- “Automation, including robotic process automation (RPA), is one of the top emerging technologies accountants and accounting firms are currently investing in and adopting” (Sage)
- “83% of accountants say that clients demand more from them today than they did in the past” (Sage)
- “It takes at least five days for companies to retrieve accounting documents” (The Accountancy Partnership)
The 2 Biggest Accounting Challenges Solved by Document Management Software
Here are the top 2 issues affecting the accounting industry today with actions you need to take, speeding your success in 2021 and beyond.
Challenge #1 – Cybersecurity and Sustaining Your Brand Image
Accounting firms are an especially hot target for cybercriminals because you hold crucial financial data and client information that can be of high value.
Imagine trying to explain to your clients that you have lost their data.
That’s not a conversation any of us would want to have.
A data breach quickly affects the way clients view your business and rapidly damages your company’s reputation for the worse.
- Data Security
Accounting firms have an ever-increasing volume of data distributed in many disparate systems — think CRMs, ERPs, shared folders, laptops, and even smartphones. Having your firm’s data in distributed systems can create security loopholes.
Clients won’t hesitate to walk away and take their business elsewhere if or when a data breach hits your firm. Therefore, cyber-attacks result in considerable losses in terms of client confidence and business revenue.
Having your accounting data and information in the right systems unified in one location helps you easily store, manage, and share data securely.
- Compliance and Audit Procedures
To prevent rule violations and protect against any probable fines and lawsuits, accounting firms like yours need to be ready for audits and compliance standards reviews.
The ability to swiftly access and retrieve required audited financial statements and compliance documentation in case of inspections is vital.
Preparedness is key. Firms with appropriate information management systems will be able to do necessary data retrievals for compliance audits, and with a provable, compliant system, you can achieve a competitive advantage over those without.
Challenge #2 – Maintaining Steady and Sustainable Growth
Independent and new accounting firms are popping up every day. That means cut-throat competition when it comes to acquiring clients in the industry.
Moreover, clients are increasingly demanding more value-added services that provide them with:
- peace of mind
- flat rates
- prompt replies
With the popularity of online reviews, it’s easier than ever for potential clients to thoroughly compare accounting firms (and the competing firms’ tech-savvy) before choosing one to do business with.
- Streamlining processes and improving productivity
Accountants are often dealing with tight deadlines, and accounting staff can quickly get tied up in tiresome manual tasks. Manual, repetitive jobs are the underlying reason that your business productivity could be taking a nosedive.
- Billable hours not meeting your firm’s required minimums
Failure of employees to fully meet potential billable hours is often the result of endless manual tasks such as searching for account information.
Having real-time access to accounting data keeps your staff in sync with the broader business tasks, calendar, and reports, which in turn escalates efficiency saving you time and making you money.
Get Ahead of Operational Efficiency with Document Management for Accounting Firms
Both the challenges of data cybersecurity and scalability can be addressed with Document Management Software.
To survive the fierce competition and deal with cybercriminal activity, it cannot be business as usual for the traditional accounting firm.
You will need to develop your customer-centric business based on a technology-focused model.
Extensive changes to the day-to-day running of an accounting firm’s workflows, client demands, work practices, security controls, and more must be undertaken for efficiency and to meet client expectations.
That’s where Document Management Software, managed by a team like Alavanca, comes into the picture.
Benefits of Document Management System Software
Leading firms use document management for accounting platforms to ensure smooth accounting workflows.
Implementing such a system gives you the following benefits.
- Adequate data storage. A document management system uses a central database where you can save a massive amount of data online. A single data interface also ensures that only the required personal get information access.
- Easy and quick retrieval of documents. Your staff can easily retrieve necessary data from documents stored in the system just by searching a specific name/keyword in mere seconds.
- Reduced data hosting costs. The cost of keeping documents is very minimal with a document management system as you don’t have to spend money on paper, replace print cartridges, add more staff, or pay for more physical storage.
- Eliminates human error. Too much paperwork causes clutter, which increases the occurrence of misplaced or lost files and other relevant documents. Document management solutions and workflow automation help eliminate or reduce such issues.
- Enhanced work allocation and collaboration. Allow staff and clients to retrieve and share work documents enabling quick simultaneous access.
- Reduced risks of damage and loss. On-site data storage is risky as fire, natural disasters, vandalism, etc. can destroy documents. Cloud-based document management helps you eliminate such risks.
- Maintains regulatory compliance. Converting paper files into electronic files helps you to achieve information control, security, and access for enhanced auditing and regulatory compliance.
- Increased security through audit trails. An audit trail shows a username, date, and time for each accounting activity that takes place within an accounting record, assisting with proper accounting practices, security, safety, and compliance.
Have questions about Document Management Software? Give Alavanca a call or send us an email to begin a no-obligation conversation.