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The Future of Bookkeeping

The Future of Bookkeeping

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The Future of Bookkeeping

The future of bookkeeping is changing rapidly and constantly due to technological advances and shifts in the way the accounting firms, bookkeepers and companies do their business.

Business Advantages of the Cloud

Thanks to the push towards cloud computing and its clear, bright future, businesses no longer need to fork over thousands of dollars to accounting firms for bookkeeping software. Especially good for small companies, businesses can now pick and choose desired functionality and services, paying for no more than needed.

Consulting and advising corporations are taking full advantage of these new technologies, providing new services due to the advancement of analytical tools, making bookkeeping and tax preparation services more efficient and significantly cheaper. The use of cloud technology, however wonderful for consultants and businesses is creating less demand for lower-value accounting, primarily bookkeeping services.

Has the Cloud Made Bookkeeping Obsolete?

These lower-value and easily automated services such as data-entry, bookkeeping and simple tax returns, primarily provided by bookkeepers are becoming less profitable. Cloud computing is making it easier for businesses to perform their own simple accounting tasks and thus bringing to light a large portion of the bookkeepers role.

This automation is proving to employers that there is no need to hire a full time bookkeeper, while the old method of once-a-week bookkeeping cannot compete with real-time information and the Australian job trend tends to agree. According to Indeed the percentage of matching job postings for bookkeepers has dropped from 0.6 prior to 2006 to less than 0.2 after 2013.

Bookkeeping Is Not Dead

While job listings for bookkeepers do appear to be on the decline, the profession still remains divided between those who believe cloud computing has killed bookkeeping and those who take a more positive stance. Among those positive about the profession are the ATO (Australian Taxation Office), Treasury and other sectors of government who are just now appreciating bookkeepers as an integral part of any successful business.

According to Rob Comelli, CEO of the Association of Accounting Technicians in an interview with BoxFreeIT, “There is a great demand for BAS services in this country. There are over two million small businesses that need the services of bookkeepers to get their books into order. The freeing up of bookkeepers’ time through efficiencies will mean that a bookkeeper can service more clients. That’s going to increase productivity rather than put a bookkeeper out of a job.”

Similarly when asked whether automated bank feeds and rule-based reconciliation would in some cases eliminate the need for a bookkeeper, the CEO stated “Definitely not. That to me doesn’t make sense. The use of the bookkeeper will last forever because people have to have a basic understanding of accounting to perform that function.” See the full interview here.

The Future of Bookkeeping

While most businesses will still require a bookkeeper to keep the books, bookkeeping will become a lot more than just data-entry, balancing bank ledgers and reconciling bank statements. These functions will certainly diminish in the coming years and may even become obsolete, thus the real cause for concern as these functions provided the most billable hours for bookkeepers.

While not necessarily great for bookkeepers afraid of the big change, adaptable bookkeepers and businesses will thrive in this new environment as those in the profession will now have more time to devote to adding extra value to their client’s business.

What Should Bookkeepers Do Now?

While bookkeeper’s billable hours are likely to be substantially reduced from the impact of the cloud, they should embrace the new technology and work with it rather than being stressed that their position is being compromised. The first step in ensuring those billable hours is to take on more clients. While this may at first require extra work to find those additional clients it will dramatically reduce the impact of losing a client which in turn actually makes the bookkeeping profession a more stable one.

Likewise bookkeepers now need to grow and advance their skills alongside the cloud, providing consulting services and the set up and management of integrated business systems to clients. The successful bookkeepers of the future will provide the best software availability options while recording financial information.

Although the advancement of technology will undoubtedly change the profession of bookkeeping forever, companies and employers will remain focused on revenue growth thus still requiring the services provided by bookkeepers, however; the skillset of the traditional bookkeeper will need to develop and evolve in order for them to remain relevant.

It’s never too late or too early to change careers!

Accounting is finally moving towards it’s purpose, which, believe it or not is not dealing with shoeboxes full of receipts and advice after the fact…Guy Pearson

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