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Big Data, machine learning, artificial intelligence, and blockchain have made their presence felt in some recent years, and their impact in businesses is increasing every day. This shows that these technologies will be our new future and we have to adapt. These technologies are also playing a major role in accounting.
In 2020, accounting consultants and firms are implementing dig data for increasingly larger and more central roles in the functioning of the firm. All industries, including the accounting industry, are expecting big changes this year as well as in the coming few years, on the core functioning of the industry. To deal with these challenges and survive, companies need their defences that are competent employees that understand these new technologies, large amounts of data, useful data, tools to generate actionable information from this data, and dynamic company structure.
Big Data and Accounting
Accounting consultants have welcomed the new data science and analytical tools to make data-driven decisions for their clients and avoiding making decisions on intuition and past experience that may or may not be relevant anymore. There is a need in the accountant industry to adapt to the changing landscape of the service industry and serve as strategic partners to their clients rather than holding them back.
According to the estimates, companies around the world are going to be deploying new age big data tools rapidly. The number of businesses using big data is going to increase twofold. These companies are going to need services that can help them with the new technology and new standards of the industry. The rate at which companies are adopting big data technologies is at its highest and is going to constantly increase for some years. Some other technologies that complement big data are robotics and process automation, as well as data visualization.
A reason why companies are rapidly employing these technologies is that using analytical technologies gives them a big edge over their competitors. When competitors see these companies benefit from adopting new technologies, they also work on employing these technologies to stay in the competition. All companies, irrespective of their scale of operations, are going to benefit from big data and other new technologies.
To keep up with the industries, accounting professionals also need to be trained and acquainted with working with big data. This is important to provide value to the client as well as to compete in the accounting world. The existing professionals need to be trained and certified to work with big data tools and data visualizing practices. These skills will soon become necessary for any accountant or consultant. An accounting consultant will very soon be required to make data-driven decisions based on actionable insights generated from big data programs and algorithms.
Impact of big data on the accounting industry
This is the age of data. For the first time in history, we have so much useful consumer data to make use of, with the help of the internet and technology. Today, the world produces 45 zettabytes of data in one day. There is so much data that there is a scarcity of professionals who could make use of that data, process it, and generate actionable information. This is because the data collected has to be sorted and organized first. This will require various new and powerful software tools. And a professional would be required to be skilled in using these big data software.
The current widely used infrastructure that refers to both manpower and machine tools is not sufficient to process vast amounts of data that is being produced every day. Processing this data would require skilled professionals and powerful computer tools. There are so many services like Google, Facebook, and other social media websites that generate unimaginable amounts of data every day. This data is generated by tracking the behaviour of millions of users. This is our future.
Accounting professionals have realized this truth. They have embraced the new changes that dawn upon all industries. Because this is only going to increase the efficiency and scale of businesses, other technologies like Artificial intelligence and machine learning can be integrated with big data to create state-of-the-art accounting processes to help clients.
Here are a few ways the accounting industry expects big data to impact:
This is the central part of the accounting industry. Auditing helps in learning about the finances of the company. But in today’s world, businesses expect insights that will help them improve their business’ productivity in better ways than the conventional auditing process. Many accounting companies are moving from conventional auditing processes to data-driven and 360-degree audit systems that include all the divisions of the businesses at once. With the help of big data, all the information reaches the auditors in real-time. This way, actions can be implemented much rapidly, and threats can be handled before they do much damage.
Automation has helped the accounting industry eliminate repetitive accounting works and move to a role that is more of a consultant. This is because there is no substitute for the experience of accounting companies who have witnessed many businesses grow to profitability and stability in many years of their operation. The new role of the accounting consultants is of an advisor and consultant for new and small as well as large businesses. To do this, big data is of great help. It can help generate actionable information for the clients that are in real-time and can be implemented quickly. They can also help clients in their long-term strategies.
Various factors, like the quality of employees, operations, cash-flow, etc. can affect the performance of the business. But with the help of advanced analytical tools based on big data, new targets can be set and achieved quickly to improve the performance of the business. Data of the whole industry can also be analyzed to give insights about market trends and be prepared for threats and opportunities for growth. These technologies also help in identifying consumer behavior and pattern so that the experience for the consumer can be improved.
Analyzing in advance of possible risks and threats and being prepared for them is required skill for successful businesses. Big data and its predictive analytical tools help generate and predict patterns to speculate future risks. Accounting consultants can advise the clients on ways to equip themselves for danger. They also notify of upcoming trends and opportunities for growth that can be utilized to their fullest potential. All this can be done without any human intervention, and only with the use of tools and software.
Big data and analytics help convert and transform the data into information. This useful information can be used to generate actions that can prove beneficial to the organization. In accounting, big data can be used to identify potential sources of income or causes of loss of income. This information can be then acted upon by formulating a plan r strategy to combat the issue. To convert big data into actionable insights, there is a requirement of trained professionals who have great analytical abilities and flair for spotting trends and patterns in numerical data.
All this can be expected from big data and its rising impact on businesses and in the accounting world.