The accounting and finance world detects a rapid gain in the popularity of accounting automation. It’s driven by the advent of technology such as Machine Learning (ML), Artificial Intelligence (AI), and Robotic Process Automation (RPA). These technologies revolutionize several departments in finance.
According to a survey conducted by MarketWatch, automation is forecasted to grow at a CAGR of 29%, earning 9$ Billion by 2026. The fintech growth is poised to improve the accounting and finance world immensely. It offers many benefits, such as real-time cloud-based access, accurate projections, and easy access to data for informed decision-making. Moreover, many automation tools are specially designed to cater to accounting professionals’ needs.
Automation Success Depends Upon Implementation
Accounting automation is proficient at keeping precise financial records, performing reconciliations, predicting revenue, and issuing alerts. But the point should be clear: automation is impossible without human intervention that can forecast the future easily.
For example, human involvement includes proper integration of bank accounts, inventory software, and payroll tools. These initial conditions are crucial for any accounting automation software to function correctly. This cutting-edge technology also relies on timely data input such as sales data, accounts payable or receivables, and expense reports.
Although these tasks may seem easy, it’s not, and automated software can do good only when it receives the proper set of commands.
Emergence of Automation in Finance
Usually, accounting and finance departments are considered risk-averse, but they are pioneers in adopting advanced technologies such as automated bookkeeping. In the banking sector, many organizations look forward to adopting accounting automation to manage ever-increasing demands. This automatically leads companies to delve deeper into what AI is and the way it’s being utilized.
AI involves the evolution of online systems that have the capacity to perform tasks that ordinarily require human intelligence. Experts state that automation and AI are reliable solutions that effectively address compliance, finance, and risk challenges. Implementing automated bookkeeping provides an opportunity to mitigate the risks stemming from human mistakes. Though it also prompts concerns about the extent to which cautious finance experts will rely on machines.
Moreover, risk and audit functions require evidence that strategies are efficient and effective. Regardless, AI can raise concerns about accuracy, handling large volumes of data, and self-learning. But, is it sufficient for a company if cognitive systems can achieve 97% accuracy in decision-making compared to 95% for humans? How can the organization predict if accuracy goals have been met? Who will make that determination? Where do online software and human intervention intersect?
Technological advancements can provide more precise and timely data, but operational decisions require human involvement. Financial bots provide a clear picture of more efficient and strategic finance functions.
Boost the Pace of Processing Journal Entries
Manually inputting crucial financial information through the SAP Graphical User Interface (GUI) is time-intensive and arduous. It usually leads to costly and error-prone work. SAP-enabled Excel workbooks provide a solution that eliminates the increasing need for conventional data entry. It allows employees to complete their required tasks more effectively with less error rate. Moreover, it also enables them to devote precious time to analyzing anomalies and undertaking other high-priority tasks.
Optimize the Invoicing Process to Prevent Traffic Jams
During the month-end, the Accounts Receivable and Payable teams usually find themselves swamped with stacks of invoices that need to be entered. Given the high volume, time-sensitive and repetitive nature of making and paying invoices, accounting automation presents a compelling case.
By leveraging automated bookkeeping, AP and AR experts streamline the invoicing procedure that eliminates the need for conventional data entry. It helps in clearing backlogs and enables them to manage invoices more efficiently and effectively. As a result, payments are on time, reduced supplier inquiries or errors, and improved relationships.
Boost the Accuracy of Master Data Records
The timeliness and accuracy of financial accounting operations rely on the master data. Omissions or errors in supplier and customer master records delay payments or invoicing, which leads to problems that are time-intensive and costly to fix. Automating this procedure, finance experts can instantly create and update master data.
Key Takeaways
At last, the benefits of accounting automation are immense, including accurate projections, real-time cloud-based access, and easy access to data for informed decision-making. The future of finance is accounting automation, and it’s high time for experts to embrace this change to stay ahead of the curve.