A continuing evolution
Cloud accounting software takes its next steps
Like many things, accounting performed on computers has come a long way in the last 50 years, especially recently. While many firms and clients are still using desktops, an increasing number are using those PCS to connect with applications and storage located elsewhere. And the exact location of this “elsewhere” has become less important than knowing that the companies offering these services are respectable, responsible, stable and affordable. Today, more and more firms and their clients are moving from in-house to the cloud, and this trend shows no signs of slowing down. As in past years, we’ve turned to the vendors of cloud accounting solutions for answers and insights.
Where are we going?
One of the first questions we had for the surveyed vendors was where they thought the application was going in the immediate future — the next two or so years.
Toward greater productivity and requiring less human interaction was an answer that we received from many of our respondents. “Over the next few years, we’re going to see more and more aspects of automation, machine learning and AI incorporated into cloud accounting systems. First, we’ll see developments rapidly shortening, and ultimately eliminating the need for going through a monthly close,” said Taylor Macdonald, senior vice president of channel sales for Sage Intacct. “Looking further down the line, we’ll see Ai-enabled processes giving customers greater insight into their data, such as a continuous audit.”
Ben Richmond, vice president of business growth at Xero, saw change happening in three interrelated areas, starting wtih increasing automation of the processes. “While there is lots of hype, there is also tangible evidence that this new technology can positively change the way accountants, bookkeepers and small businesses work,” he said.
Richmond also foresees greater collaboration between accounting platforms and financial institutions: “Banks are increasingly looking to partner with innovative financial technology companies in order to meet customer expectations. Small businesses face persistent challenges accessing capital, getting paid on time, and accessing their data. Banks are increasingly receptive to working with tech companies to accelerate innovation and deliver new solutions to these age-old problems.”
He predicts more focus on solving the end-to-end needs of accountants: “As automation technology becomes increasingly prevalent, and data is shared more seamlessly between the core products and services that small business uses, cloud platforms will look to build the final mile of the journey by delivering end-toend practice management solutions for accounting firms. These solutions will allow firms to fully digitize their practices. Even firms who continue to focus on traditional compliance work will have the opportunity to benefit from the cloud.”
Prashant Ganti, the head of product marketing for Zoho Books, agreed about the collaboration between accounting and financial institutions. He also saw cloud accounting gaining traction in the developing world because of technology-driven compliance being introduced by various governments. Factors such as online tax filing, mandatory record-keeping, and e-invoicing are playing a major role in the adoption of cloud software.
“The ability to easily conduct business on a global basis while simultaneously being able to transact business on a local level will be very important as organizations look for growth internationally,” is also an important area where cloud accounting will grow according to Tom Kelly, senior director of marketing and management at Oracle Netsuite.
Acumatica CFO Nigel Legresley added, “We see continued momentum as still more companies move to the cloud, of course, and while cloud accounting will be dependent on the speed and completeness of that transition, some changes are already quite evident: simpler, more intuitive user interfaces, the importance of mobility, and the use of machine learning to reduce human error and repetitive manual tasks. Automated and customizable workflows will be critical as the accounting function responds to the increased speed required by a digital business.”
Christina Wiseman, product manager of centralized services and transitions at Thomson Reuters, sees increased functionality and productivity in other areas. “Many existing features will be more heavily used, such as the digitization of previously paper items, electronic notifications, and time clock features. We will start to see more user-friendly deployment of such features and see them used more broadly. For example, taking notifications beyond document sharing and more integrated in workflow. We’ll see much more e-commerce capabilities, in areas such as online bill payment, and merchant solutions. We’ve seen data entry reduced by integration — we’ll see more elimination of data entry by technology such as bank feeds and receipt recognition.”
Speaking of features
We asked our vendor respondents what features they are being asked to add.
“Today’s accountants want a one-stop shop to service all their clients and manage all their employees across their entire firm,” according to Ariege Misherghi, global leader of the accountant segment, small business self-employed group at Intuit. “We’re also finding that accountants are increasingly leveraging third-party apps to serve their clients and want the ability to easily recommend and integrate apps on behalf of their clients.”
Intuit is currently developing new features that will provide even more functionality, she said: “These include Project Profitability — an integration,