How the Accounting Industry is Evolving in the Age of Coronavirus

The accounting industry has, for generations, been the model of gradual evolution. Prior to the Coronavirus Coronavirus The outbreak of Covid-19 or Coronavirus in early 2020 has since redefined the financial services industry. Brokers have been forced to quickly adapt to several changes, both positive and negative.This includes the FX industry, which saw surges in volumes across the retail and institutional space in Q1 2020. This trend can be explained by an outflow of volatility, coupled with countries taking major moves to stabilize their respective economies.In conjunction with uncertainty caused by the virus, The outbreak of Covid-19 or Coronavirus in early 2020 has since redefined the financial services industry. Brokers have been forced to quickly adapt to several changes, both positive and negative.This includes the FX industry, which saw surges in volumes across the retail and institutional space in Q1 2020. This trend can be explained by an outflow of volatility, coupled with countries taking major moves to stabilize their respective economies.In conjunction with uncertainty caused by the virus, Read this Term upheaval of 2020, most U.S. accountants still relied on paper-based processes, desktop computer applications hosted on internal systems, and in-person collaboration with colleagues and clients.

“Steady as she goes” was the trademark of accounting. While modernization and technological advancements were in the works, change has not come readily to the accounting industry at large.

That all changed with the pandemic. Small businesses in particular found themselves thrust into the vortex of a cyclone that threatened to rip them from their foundations and tear them apart.

Not only were bookkeeping firms not immune to the virulent challenges of trying to keep their own doors open, the vortex sucked them in right along with their clients.

The plodding pace of change in the decade preceding 2020 shifted from evolution to revolution, bringing with it unique challenges, pressures, and questions.

With the winds of change whipping around them, accountants have witnessed as much innovation in their industry in the last six months as there was in the previous six years.

Weathering the Storm, Preparing for the Future

According to an article on BDO.com, companies caught up in the COVID-19 tempest tend to fall into one of three camps:

1. Triage mode – crisis management, cost reduction, government relief legislation, and ultimate survival.
2. Growth mode – scrambling to keep up with surging demands for “essential” services and goods, such as medical, agriculture, and plastic bottles for hand sanitizer.
3. Backlog mode – existing orders have insulated these companies from feeling the impact...so far.

Regardless in which category a business finds itself, they must take certain critical steps to prepare for the future.

• Increase communication with customers, employees, and suppliers. Keeping the lines of communication open and demonstrating empathy are the surest routes to recovery when the crisis ends.
• Move financial and business processes to a virtual environment to enable the company to function in an office-less condition. The potential cost savings and efficiencies from reduced property footprint for many businesses are alluring and significant for long-term operations.
• Document gaps in contingency plans and improve responses to future crises. No forward-looking business should be caught flat-footed in the “next normal”.

As business clients retool and reorganize to meet the new normal of a globe gripped by COVID-19, their accountants must plunge into the brave new world of paperless transactions, totally electronic bookkeeping, artificial intelligence-driven systems, and remote communications.

As these changes weave themselves into the fibers and sinews of Main Street USA, the fact becomes obvious—Dorothy is not in Kansas anymore, and no ruby slippers can take her back.

BooksTime is an example of an accounting firm that has had a front row seat to the spectacle of small-business turbulence on a massive scale.

Along with their partner firms around the U.S., BooksTime has witnessed unprecedented metamorphosis in virtually every company.

Whether a business is battening down the hatches to weather the gale or gearing up to meet unexpected demands, everyone feels the effects of the pandemic storm of the century.

Cloud Accounting

A well-publicized innovation in accounting technology has been the skyrocketing adoption of cloud accounting systems.

Take a traditional bookkeeper on a dedicated computer with a single-user license for a desktop application that stores data on a local hard drive, and tell them to work from home.

What you get is a deer in the headlights. It’s not all bad news, however. On the one hand, paper receipts don’t pile up on the bookkeeper’s desk until they can get around to entering them.

On the other hand, the Accounts Payable clerk no longer chases Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term because there is no way to know who has and hasn’t paid.

Cloud systems break through the deadlock of on-premise systems and single-license apps. Data becomes available to all authorized users around the clock.

Managers, accountants, bookkeepers, and clients can work from different locations and time zones while they control and monitor the enterprise’s financial health.

A recent article on AccountingToday.com says of cloud innovations’ impact on accounting, “The impact of COVID-19 on bookkeeping practices has forcefully demonstrated the sheer versatile scalability of cloud accounting. It’s up to the software provider to manage server space, speed and performance, and usually for the cost of a monthly subscription, which is much more financially flexible.”

What’s more, major league features like Artificial Intelligence, Machine Learning, and Business Intelligence, which were once accessible only to corporate giants, are now within reach of any small business through such cloud-based systems as QuickBooks Online. BooksTime has been a long-time proponent of QuickBooks, Xero, and other cloud solutions.

Enhanced Soft Skills for CPAs

No matter what technical solutions are in play, to maintain credibility with their clients, CPAs must groom their soft skills to see their clients through these challenging times, according to an article on CPAPracticeAdvisor.com.

These essential soft skills include:

• Adaptability – show clients you are all in this emergency together and emphasize the positive outcomes you have achieved while navigating the ongoing changes.
• Problem-solving – assuming the pandemic will affect businesses for months and perhaps even years, address your client’s most pressing needs first and then work backwards to handle the long-term challenges.
• Communication – do not let technology become a barrier to effective communications. Listen actively and demonstrate empathy. Good communication can be just as valuable as technical solutions.

Whether you are an independent accounting firm or an internal resource, your ability to adapt, solve problems, and communicate can mean the difference between success and failure for you and your customers as you look down the yellow brick road together to the future.

Offshore Operations

A secondary effect of cloud computing is equally stunning but not as widely understood, namely, the shift to offshore accounting.

The ubiquity of remote, online account systems has massively accelerated the move to remote, online accountancies.

As more business transactions can—and often must—be performed remotely, firms are capitalizing on the advantages of the lower costs offered by accounting talent overseas.

BooksTime (https://www.bookstime.com/) has been out ahead of the curve on offshore operations for some time now. Already focused on remote, online services, they have established a solid beachhead of offshore teams, including three offices in Europe and one in the Philippines. The offshore wave has not caught BooksTime by surprise.

Although remote services were relatively uncommon until the pandemic tsunami, the pattern of offshore accounting has been caught up in the surge, and the entire market is being swept by the current to distant shores—and fast.

Looking for an anchor in the storm, accounting firms around the country are seeking advice and help from veteran offshore operators like BooksTime to set up overseas operations.

BooksTime has proven the model works. Dorothy may not be going back to Kansas anytime soon, but BooksTime can take any small business to a better place and a brighter future.

Disclaimer: The content of this article is sponsored and does not represent the opinions of Finance Magnates.