How has technology influenced accounting?

Accounting and Technology

There is no doubt that information technology has had a profound effect on the accounting profession. Since accounting is about dealing with lots of information – business information more specifically, digital skills are now an essential part of the process and will continue to evolve over the next few years and beyond.

The Necessity of Technology in Accounting Industry

With Making Tax Digital (MTD) just around the corner for accountants and companies, a focus on digital is no longer a luxury, but a necessity.

Here at Alexander & Co, we understand just how important technology is when it comes to accounting, so we’ve asked our accounting technology expert to explain just how technology is used and how Making Tax Digital will impact accounting all over the UK.

Equipment

One of the most obvious advances in accounting technology is the myriad of new equipment. It’s not just for large businesses either. Computers, scanners and printers are readily available to industries of all sizes at a reasonable cost. Instead of piles upon piles of paper, this new technology is fast, sophisticated and simple to use.

Software

As well as the equipment, sophisticated software is needed to support the ever-evolving needs of accountants in the digital age. Accountants fully appreciate the ever-evolving software.

Spreadsheet software is a highly efficient way of calculating and keeping track of accounts. For the modern accountant, this can help speed up, streamline and automate daily tasks, such as recording transactions, paying bills and reporting.  

Of course, this is where the added value for clients is seen most. With this streamlined approach, aided by technology, accountants will now have extra time to offer other financial business advice, whilst completing their administration work at a much faster rate.

Software packages are also simple to use and affordable, making them popular with businesses of all sizes.

Cloud Computing

The internet has made life easier and opened so many doors, especially in the accounting area, where research can be conducted and tax filed all online and documents where research can be conducted.

In the past 10 years, running applications online have been one of the most important development in IT in the last 10 years. The Cloud is ubiquitous computing at it’s finest, whether it’s sharing applications and files via Dropbox or an email system such as Google’s Gmail, or the numerous business software products including customers relationship management.

Security

A common worry with information technology advancements in the accounting industry is how secure it is. However, with information technology, security measures can be greatly enhanced with proper computer programs, instead of having masses of paper and folders lying around. Accounting information can be encrypted in a way that can prevent unauthorized use, debunking myths that it’s not secure. Furthermore, a stolen, misplaced or lost desktop or laptop can now be tracked using security software.

Education

Because of information technology and accounting having such a close relationship, universities are now offering four-year courses in accounting and information systems. It shows that universities are now preparing graduates for the technological challenges of the future by creating technological savvy accountants.