Guest Post by Pohan Lin.
Accounting tasks have long earned notoriety for their slow, manual nature. All that is now set to change, as accounting is one of the areas where automation can bring the biggest benefits.
Admittedly, changing the way things have always been done is nerve-wracking. But there are some basic dos and don’ts you can follow to make sure your automation initiative runs as smoothly as possible. Before we get into that, let’s talk about what accounting automation entails.
What is accounting automation?
Accounting automation means using software to handle the tedious, repetitive tasks that accountants used to do manually. We’re talking about tasks like invoice processing, banking reconciliation, expense management, payroll, and financial reporting.
These are all prime examples of processes that once took hours of painstaking work, and can now be done by a rule based AI system in a mere fraction of the time. Work is done quicker and more accurately, and these tools can help with data security and detecting potential financial fraud.
The benefits of accounting automation
Here’s how automation is flipping the script.
Major time-savings: What’s your least favorite accounting task? Maybe it’s invoice matching or crunching numbers for a report. Automation means you’ll never have to do it again, as it deals with the bulk of the work with minimal manual intervention.
Goodbye to mistakes: We all make mistakes. Unfortunately, in accounting, those mistakes can cost money. Automation reduces the chance of typos, miscalculations, and other errors that come with manual data entry. This means you can trust your numbers a whole lot more.
New levels of insight: Sifting through mountains of financial data to understand trends and patterns can be an exhausting task. Automated systems analyse this data in seconds, presenting it in easy-to-understand reports.
Compliance is a breeze: Keeping track of constantly shifting financial regulations and reporting standards is no joke. Automation helps you stay on top of these demands, minimising the risk of errors, penalties, or headaches during audits.
1) DO: Start with a clear plan
The prospect of automating all those tedious tasks is exciting, but take a moment to outline a clear plan. Establish the specific problems in your accounting processes that are causing bottlenecks and headaches.
Work out what is causing the most difficulties, and then you can select the automation tools that directly address those needs within your budget. Don’t just pick the flashiest-looking solution, think carefully about what tool can support you in achieving your targets.
2) DON’T: Automate everything at once
Tempting as it may be, don’t attempt to automate your entire accounting department in one go. While the benefits of automation are great, changing everything at once is a recipe for chaos. Instead, start small by choosing one or two processes where automation can have the biggest impact.
If you handle hundreds of invoices every month, then this would be a great first process to automate. Starting small in this way allows your team to get familiar with how the software works, iron out any wrinkles, and adjust your workflows gradually without triggering any major upheaval.
3) DO: Focus on data quality
One of the big ways AI is affecting accounting is the way data is handled. Automation is only as good as the data you’re providing the system. Before you start automating, set up strict procedures for data entry to ensure information is complete and error-free.
This needs to stay a top priority even after automation is up and running. Remember, even the most sophisticated software can’t produce accurate reports or reliable insights if it’s working with sloppy or incomplete data.
4) DON’T: Neglect training
Your new automation tools won’t reach their full potential without a well-trained team. Provide everyone who’ll be using the software with thorough training sessions. This should cover how to use the tools but also include an introduction to Apache Hive and other data analysis concepts.
Training should teach them how to identify and troubleshoot any errors or strange results the system might produce. Emphasise that support is always available, and make sure your team knows who to contact and how to get help when they need it.
5) DO: Emphasise change management
It’s natural for some employees to worry that automation might put their jobs at risk. Don’t let these concerns fester, be proactive about talking to your team about what automation will mean for your business.
Make it clear that training and support will be available to help them adapt to the new way of working, so they can feel confident using the automated tools.
6) DON’T: Underestimate integration
Your new accounting automation software won’t work well in isolation. Before you make any final decisions, confirm that it’s compatible with the other systems you already use, like your CRM or ERP.
Carefully plan how you’ll connect everything to avoid disruptions to your business and end up with a mess of mismatched data. Bring in your IT team if needed–they can help you work out if every tech puzzle piece will fit together perfectly.
7) DO: Set realistic expectations
Although the advantages of automation are significant, it won’t magically fix every problem. Setting up the software takes time and patience will be required as you iron out any initial kinks. Don’t get discouraged if things aren’t perfect right off the bat.
It’s also important to bear in mind that automation won’t eliminate the need for human oversight. You’ll still want to review results and keep an eye out for any unusual data. Set realistic expectations for yourself and your team on when you’ll start to experience the biggest benefits.
8) DON’T: Set it and forget it
Don’t think of automation as a solution you can put in place and then never think about it again. To get the most out of it, you’ll need to regularly monitor your automated processes and make sure everything is in order.
As you become more familiar with the software and your own needs, look for areas that you can make even better. Your business needs will likely develop over time, so be ready to adapt your automation strategy alongside those changes.
9) DO: Prioritise security and compliance
Financial data is incredibly sensitive, and protecting it should be a non-negotiable part of your automation plan. Implement strong cybersecurity measures to protect your information. When choosing automation software, look for solutions that adhere to your industry’s specific regulations and prioritise security.
Accountants can harness AI tools within these solutions to further bolster security and analysis. Make it a habit to regularly update your software and review your protocols to stay ahead of potential threats.
10) DON’T: Skimp on human expertise
Yes, automation is an incredibly powerful tool, but it won’t replace the need for your skilled accounting and finance team. You’ll always need their expertise to interpret the data your automated system provides, turn those insights into action, and make sure everything is working as intended.
Remember, human knowledge in understanding financial strategy and potential implications is something software can’t replicate. Rather than thinking about automation as replacing jobs, look at it as an opportunity to redirect talent and expertise into more valuable work.
Make accounting automation a success
Accounting automation is set to revolutionise how businesses manage their finances.
Implement automation strategically and follow the guidelines outlined above to optimise your accounting operations and achieve better overall financial control. Now is the time to start automating, you’ll find that even one small process can generate big rewards.
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