Is Technology a Threat to Accounting?

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You’ve probably heard that the recent development in technology, particularly the artificial intelligence (AI) in accounting software, is a threat to your job as an accountant.

Questions such as “Should I hire an accountant or is accounting software enough?” is not uncommon in forums, Q&A sites, and the like.

A simple Google search of the keyword “automation and accounting” would even yield links to articles and videos saying that technology is slowly killing the number crunchers in the industry.

We beg to disagree.

Technology in accounting–that is the accounting software–is by no means created to eradicate accountants in the field. Instead, we regard it as a tool to take off the menial, repetitive tasks off of your shoulders. (We talked about this before too.)

What does that mean?

To illustrate, here are five ways accounting software, particularly Oojeema, can disburden you without, you know, removing you from the picture.

Data input

Image from Quora

Traditional methods such as handwriting require you to write the same details about an entry over and over again. If you’re using a spreadsheet, we’re pretty sure Ctrl + C & Ctrl + V is your way to go.

Sure you can write codes for the spreadsheet to automatically fill in data for you, but it still takes time, doesn’t it?

Accounting software like Oojeema has that covered, so all you have to do is choose the entry (e.g. customer name or item name), and you’re good to go.

Generating financial and tax reports

Raise your hand if you think these two are the most painstaking tasks you have as an accountant.

All the journaling, calculating of the taxes (for the tax forms) or the assets, liabilities, and net worth (for the financial statement), and placing these data together in their respective forms–they are just tedious.

There’s also the checking and double checking of entries to guarantee accuracy.

Yes, there are formulas you can use to make the calculation easier but these, too, need rigorous effort.

With accounting software, however, all you have to do is click one or two buttons to generate the necessary forms.

More often than not, the reports you need are updated real-time as you enter sales, purchases, or expense transactions. What’s left for you at the end of the day is to ensure the accuracy of the entries.

Recording transactions and bank reconciliations

If accounts payable (AP), accounts receivable (AR), and bank reconciliations make your eyes roll, we totally get you. These transactions are probably three of the most painstaking tasks you do on a daily basis.

In the traditional run of things, these transactions are manually entered into journals then posted to the general ledger and subsidiary ledger accounts. In the case of bank reconciliations, bank statements are manually compared to the company’s general ledger account.

When you use accounting software, however, AP and AR are automatically updated as you enter invoices. The vendor and customer details are also modified on the fly.

Time spent on reconciling bank transactions is also significantly reduced because balances on both the bank statement and general ledger are automatically matched. All you have to do is to verify the data.

Organizing accounts

If you’re an accounting firm handling accounts of multiple clients or an in-house accountant who handles your boss’ multiple companies, you may be familiar with the pain of having to maintain different ledgers and journal or spreadsheets for each account.

Sure you can resort multiple sheets in one file, but we all know what happens when the file gets too large for your machine to process.

In contrast, accounting software features multi-account support. A simple click on the Switch Company button and you’re presented with the new dashboard.

Collaboration

If you’re not flying solo, then you know how collaborating with your teammates poses some challenges on your documents.

Whether you are manually writing the financial transactions or sharing the spreadsheet online with your team, you understand how this can be daunting.

And when there’s a mistake in the records, you won’t easily know who did what.

Accounting software, however, has that covered. Case in point, Oojeema’s multi-user support and audit trail feature. These features let you work with as many team members as you like without worrying about who entered what. The audit trail provides you with the necessary details just in case you need to countercheck.

What we’re trying to say is

In other words, we don’t believe that technology will get rid of accountants altogether. Yes, technology has changed how number crunching is done, but human judgments and decisions are still necessary in every industry. And that is something no bot can provide.

In fact, when we created Oojeema, we designed it in a way that it would value human input without asking too much time and effort.

More specifically, Oojeema merely automates that which can be automated like a posted Purchase Order means you have a payable to the supplier. The software can handle automatically generating an Accounts Payable voucher for you. You just need to process the payment.

It is pretty much like all the other tools and gadgets we have like the washing machine, for example. We no longer do the washing per se, but we are still the ones who load the clothes into the machine and later on check if it’s clean enough or needs more rinsing.

Technology in accounting just makes the accountants’ responsibilities lighter.

References:

https://www.forbes.com/sites/theyec/2018/09/10/ais-impact-on-accounting-and-finance/#3b3097ee8559

https://www.accountancyage.com/2018/09/03/what-has-robotic-process-automation-brought-to-accountancy/

https://www.accountingcoach.com/bookkeeping/explanation/9

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