5 technologies that will rock your business in 2019
Business models are evolving at the same rate as technology, in other words, very quickly. The rate of change that we are witnessing in accounting technology today is absolutely staggering. What’s more, this is likely the slowest rate of change that we will experience for the rest of our lives. Companies can view this as a threat or an opportunity, depending on their willingness to adapt. Entrepreneurs and business leaders are responsible for considering the ability of their company to keep up with, or surpass, their competition.
To help you on your journey, I’ve summarized what we see as the 5 technologies that can immediately help your business be more successful in 2019…
1. Software as a Services (SaaS)
For businesses to be successful, their leaders must deploy effective, secure, and accessible tools that allow their teams to collaborate and focus on value creation (rather than wasting their time on repetitive data-entry tasks). It is time to ditch your server in exchange for SaaS solutions.
The advantages of moving your company to a SaaS solution are:
- Costs. Deploying cloud-based software solutions is usually much less cost prohibitive than on-premise hardware, and it can be done much faster. This is because no one is required to show up on-site, and there is no hardware to deal with. Operating costs are often less than maintaining on-site hardware as well;
- Maintenance. You never have to fix the hardware because there is no hardware to fix. Most SaaS providers guarantee little or no ‘down-times’. They have plans in place to deal with their maintenance that rarely disrupts your workflow;
- Backups. Our firm has committed countless thousands of dollars backing up on-site data over the years to guard against ransomware and hardware failures, but we no longer have to. With a SaaS platform, you never have to worry about backups. These platforms have seamless backups built right in;
- Security. SaaS providers are very committed to data integrity and security. It is the backbone of their business. Security breaches seriously jeopardize their credibility in the market. Microsoft, Google, and Amazon (for example) have much bigger security budgets than you do. When you use their services, you get access to their security – it’s a no brainer;
- Collaboration. It’s the name of the game in high performing enterprise. Most SaaS providers give their customers amazing ways to collaborate internally, which spurs creativity and creates efficiency. For example, people sitting on different ends of the planet can attend a live video call while working on the same set of documents with ease – just like they are sitting next to each other in an office;
- Space and Scalability. You’ll never have to swap out a hard drive again. In fact, I can’t even remember the last time I saved something on my computer’s hard drive. With SaaS options, your IT infrastructure easily scales with you. It’s completely effortless.
Examples of SaaS providers: Microsoft Office 365, Google Cloud, Amazon Web Services.
2. Cloud Accounting Software
The days of using desktop accounting software aren’t numbered yet, but the writing is on the wall. Intuit (the makers of QuickBooks) takes every opportunity they can to mention that their future is “in the cloud”. Companies like Xero have always existed exclusively in the cloud. There are still many businesses using desktop software, some because the cloud versions are missing a few features (this gap is quickly closing – for most, this isn’t an issue). Others are simply more comfortable using the desktop software they’ve known for years.
Advantages of moving your company’s accounting to the cloud:
- Integrations. Cloud accounting packages, like QBO and Xero, act like an information hub for hundreds of other accounting and business applications. These direct and seamless integrations ensure faster and more accurate collection and processing of your data. More on this below;
- Backups. You never have to worry about your computer’s hard drive or server crashing, and you never have to run external backups on your data;
- Accessibility. Yes, there are options to access your desktop accounting software remotely, but they come with significant costs and limitations. With cloud accounting software, all you need is a web browser and an internet connection. Further, it is very simple to assign access to various other members of your team, such as your accountant, often at no additional (or marginal) cost. You can even grant limited permissions if you only want team members to have access to certain areas of your books, such as accounts receivable or payable and not financial reporting;
- Apple fan? The solutions look, feel, and function exactly the same on Mac and PC;
- Ease of use. For years, lack of simplicity has been a common complaint of QuickBooks Desktop. Products like QBO and Xero focus on user experience and on putting things exactly where you’d expect them to be;
- Seamless transition. It is fairly simple and convenient for a QuickBooks desktop user to convert to QBO and move all their historic data with them. Intuit has developed a great tool that transitions a desktop users’ data to the cloud in a couple easy steps. You can always hire a transition expert to assist you, such as Achen Henderson CPAs.
Examples of Cloud Accounting Software: QuickBooks Online (QBO), Xero, Sage Business Cloud Accounting
Fabulous cloud accounting software comes alive when a company starts tying in some useful integrations. At our firm, we have partnered with private, as well as off-the-shelf, software companies that provide cloud solutions to automate almost every accounting cycle and function. These products integrate directly with QBO and Xero, creating the illusion that they all function as a single platform.
These software technologies are amazing, and they may sound simple. A cautionary note that they require a time commitment to set up and monitor to get the desired results from them. This is part of the service that we offer at Achen Henderson CPAs.
Some examples are:
- Expense tracking. The software allows you to take photos of receipts with your phone and submit them to your accounting system. You can also forward emails of your receipts to your accounting system. We use email forwarding rules for vendors who regularly email us bills and receipts – set it and forget it. The software’s OCR (Optical Character Recognition) technology reads the receipt and extracts data from it such as: the vendor, date, cost, tax, and payment method directly from the receipt. The software can even be programmed to enter transactions directly into your accounting software;
- Expense reports. Employees are given a phone app to take pictures of all their expenses and create an expense report, complete with expense categories and descriptions. They submit the expense report for approval, and once approved, the software will automatically post the entry and the payable into the accounting records for automated reimbursement by the payables system (see below);
- Statement Fetching. These great tools log into all your online accounts to fetch and store all your invoices and statements. Retrieve bank statements, utility, cell phone, amazon, godaddy, Microsoft statements (the list goes on and on) without ever having to open your mail or go to your online accounts. You can even program the software to post bills and receipts immediately, as they are fetched, to your accounting software;
- Accounts receivable. Lump specific customers into specific collection action categories and program their journey through your collections cycle. Set up automated and customized phone calls, emails, text messages to be delivered to your customers when certain time or balance overdue milestones are reached. Allow your customers to pay you right away within the automatic alerts;
- Accounts payable. No more cheques or e-transfers. No more trying to remember what those withdrawals on your bank statements relate to. This software pulls your current payables listing directly from your bookkeeping software. All you have to do to pay a vendor is click on the line item you want to pay and press send. The receiving party is notified by email that you are trying to pay them, and they accept the payment. Your AP is cleared and updated automatically – so it is always current. The best part is it costs less than a stamp to send your payments this way;
- Time tracking. Each employee downloads an app on their phone where they can enter their hours and attach them to the project they are working on, add their CPS location, and the customer they are working on. They can even take a photo of what they’ve done and attach it to the time-card. The time-sheet approver reviews the hours for accuracy before payroll is run. Robust reporting allows clear visibility across all staff, customer, and jobs;
- Payroll. Approved time cards are imported directly from the time tracking software, and salaries are automated. When payroll is run, the software calculates the correct deductions, emails the employees a pay slip, withdraws the cash from the company’s bank account, deposits the paycheques directly in the employee’s bank account, and remits the required withholdings to the CRA. At the end of a pay run, the software posts the payroll entries directly to the accounting software. At the end of the year, the software issues T-slips for the employees to report their personal income on their tax returns.
Examples of integrations we like and use: Hubdoc, Receipt Bank, Expensify, Ledger Docs, Auto Entry, Invoice Sherpa, Plooto, TSheets, Payment Evolution, Wagepoint.
4. Machine learning and Artificial Intelligence.
OK, we’re not suggesting you should call up Miles Dyson at Cyrberdyne Systems to explore how Skynet can help your business survive Judgement Day, not at all. In the accounting world, Machine Learning and A.I. help level the playing field between huge organizations and smaller ones by giving the company a virtual army of data entry technicians for a fraction of the cost of hiring an army.
Our firm uses Machine Learning and A.I. to power our customers’ bookkeeping and data entry functions. When a certain type of transaction pops up, from a particular vendor, in a particular amount, paid from a particular account at a particular time of day, our bots are able to categorize and post these transactions with a very high degree of accuracy. They can do this because they have learned how to deal with the transaction based on a large data set of transactions from thousands of companies. What’s more, our systems learn the specific peculiarities of your business over time and learn to post transactions the way you want them to be posted.
Advantages of Machine Learning and A.I. are:
- It’s fast, very fast. Machine Leaning and AI ‘bots’ are able to process huge amounts of transactions in a very short period of time. This means our clients gain access to real-time financial information about their companies;
- Accuracy. Our bookkeeping ‘bots’ have outstanding accuracy rates, much higher than we have seen from their human counterparts;
- Re-sourcing. It is very unlikely that machines will replace people. Instead, as we have seen countless times in the last few hundred years, they will create amazing new opportunities for people. Business leaders are able to re-source their people who were previously engaged in data-entry tasks to more valuable tasks, such as having more meaningful interactions with customers. We believe people at all levels in an organization will be empowered to find new ways to add to their company’s success when they are freed from the shackles of repetitive data-entry work.
Examples of accounting firms that leverage Machine Leaning and A.I. to make their clients’ companies more successful: Achen Henderson CPAs.
Blockchain is an open ledger of a transaction between two parties that is impossible to edit and is completely transparent. It offers complete, factual visibility of the transaction. We are still a few years away from seeing blockchain used widely; however, it warrants consideration and understanding – for it is the way of the future.
Here’s an example of how this will affect, say, a purchase I make on Amazon.ca:
I click ‘buy now’, triggering a sale on Amazon’s end, which is offset by a collection from my credit card. On Amazon’s end, their accountants record the sale transaction, along with my name and address, and ‘reconcile’ the deposit to their bank statement. On my end, I receive the receipt and submit it to my accountant, so they can post an expense entry that will ‘reconcile’ with the accompanying transaction on my bank statement. All this posting takes place at some point after the actual transaction takes place. The receipt needs to be stored somewhere as a record of the transaction. Both accountants have the ability to change the transaction manually.
In a blockchain world:
I click ‘buy now’, and the sale transaction is simultaneously recorded in the ledgers of both companies. This is a single transaction whose data is un-alterable and cannot exist in one company without the other. There is no need for an accountant to reconcile anything because the transaction is correct, audit-able, immediate, and transparent. The transaction data that would typically reside on a receipt (sale amount, tax, date, product purchased…) is hard coded into the transaction – there is no need for a receipt, as the transaction simply ‘is’. There is no other way for it be.
In order for businesses to remain relevant, business leaders must consider the full-scale adoption of technology essential. Learning and adaptability have become the currency in today’s business world, and companies that embrace technology will enhance their value proposition and position compared to their peers that do not.
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