Adoption of cloud accounting technology is accelerating among UK accounting firms, according to recent research by Xero – and a key driver of this adoption is the desire for increased efficiency.
Accounting firms that use cloud technology are more productive, have a greater demand for new staff and see a pronounced increase in their year-on-year revenues, so it’s clear that taking control of technology has many core benefits. But making the switch to a cloud platform and a completely new way of working can be daunting for some practices.
So if you’re not yet fully comfortable with the latest business and financial software, how can you embrace these technologies to save time, make more money and provide added value to both your firm and your portfolio of business clients?
We’ve outlined some of the fundamental ways to drive efficiency via cloud technology.
Choose your cloud platform!
Embracing accounting technology helps your practice in variety of ways. But you need the right cloud platform (or multiple platforms) to act as the foundations for your new practise system.
A ‘platform’ is a core system that you can build on or add to, increasing the functionality of the main system. So, whereas your old desktop accounting application just does accounting, a cloud accounting platform also lets you integrate with tools for practice management, taking online payments or running your customer relationship management (CRM) app.
You might take a single platform approach using Xero, or opt for a multiple-platform approach based around QuickBooks and Sage Cloud, tailoring your choice to fit the needs of your business clients. But what you’ll have is a core accounting system, plus a software platform into which you can integrate your choice of business apps, fintech tools and cloud solutions.
With your platform/s in place, you can then begin tailoring your accounting technology and seeing the impact on the overall day-to-day effectiveness of the practice.
The benefits of automation, AI and going paperless
Processing paperwork, keying in the data and crunching the numbers has been the traditional way of getting the compliance work done for decades – even in 2018, legacy desktop accounting is still in use and the ubiquitous Excel spreadsheet still prevails in some firms
But it’s these laborious manual processes, and the errors they introduce, that form some of the biggest hurdles to achieving true efficiency.
Technology is a huge opportunity for accountants, providing the tools for you to overcome the drawbacks of the manual processes, and increase the firm’s everyday productivity as a result.
- Go paperless and work in the cloud – get rid of the paper receipts, ring binders and document boxes and scan your clients’ paperwork straight into your cloud system.
- Use software automation wherever possible – remove the manual processes of data entry and coding of expenses by letting the software do the hard work for you
- Manage workflow on the go – have access to all your tools and client information wherever you are, making it easier to get the work done.
Whether it’s automation of low-level tasks, coding of transactions via machine learning or fully integrated real-time data across all your systems, technology makes you more agile.
Key accounting technology tools for boosting efficiency
So there’s a compelling argument for switching to a cloud platform/s and applying the benefits of online working. But what are the important apps that will help you deliver on this promise?
- Receipt Bank or Auto Entry – to automate the bookkeeping. These apps let you quickly scan in client paperwork, while also using optical character recognition (OCR) to turn the receipts into digital data that’s pulled into your accounting system.
- WorkflowMax or Silverfin – to manage client workflow. Monitor the progress of client work, assign staff to the right tasks and manage the whole process online 24/7.
- Practice Ignition or Karbon – to manage the practice. Online practice management tools provide a one-stop overview of your day-to-day internal tasks and connect up elements like invoicing, engagement letters and fees with your central accounts platform.
- GoCardless – to automate cash collection. GoCardless lets you automatically collect your monthly and ad-hoc client fees by Direct Debit, and then reconciles the transaction within your cloud accounting – reducing admin time and boosting cashflow.
- And of course Fluidly – to manage practice cashflow and automate debtor tracking. Use the AI functions to keep on top of cashflow analysis and automate your credit control function to chase up any late payers and overdue invoices.
How software efficiency drives growth
Cloud drives efficiency. Combining an automated approach to accounting with a fully integrated platform for all your practice apps and tools is a gamechanger – taking your workflows, client processes and internal procedures to a new level of productivity.
This all helps you become more effective as a team. The basic bookkeeping, client admin and financial compliance gets taken care of automatically, freeing up time to service more clients and focus your team’s attention on customer-facing conversations and value-add services
Tech also accelerates revenues. By increasing the size of your client base, or upselling more high-value advisory work, you increase revenues – whether by upping the number of monthly fees brought in, or by increasing the average amount that each client pays monthly.
Greater income = improved cashflow, giving you the liquid cash you need to invest in the firm’s growth – be that hiring more people, expanding your operations or systemising your entire business model so you can successfully scale up your practice.
Fluidly – using tech to manage cash and debtors
Fluidly’s smart cashflow accounting technology helps you stay in control of the firm’s cash position, using smart algorithms to highlight the key insights in your financials. And you’re also kept in full control of your aged debt with automated debtor tracking and team notifications.