1st April, 2021
Tech developments continue to have positive impacts on the accounting industry as developers create new tools and features for advisors and their clients.
Today, many jobs that used to take hours or even days to complete can be done in minutes, and increasing numbers of tasks are even starting to become completely automated.
With MYOB AccountRight now joining Essentials as a fully cloud-enabled accounting solution, here’s the lowdown on how cloud accounting has changed in recent times, and how it can save advisors both time and money.
The development of cloud accounting has created time-savings in many areas.
People can use the internet to affordably store resources and other data on offsite servers accessible from numerous devices.
This allows businesses and tax professionals to work anywhere, anytime, with quicker, easier, and more timely access for all involved.
We can access significant amounts of data whenever we need to and enjoy real-time task processing and automation.
Tech reduces the risk of errors from manual information sharing, increases efficiency, and leads to more accurate tax and other lodgements.
The Future of the Tax Profession report released by the Inspector-General of Taxation in Australia in 2019 noted that a global research survey found 67 percent of accountants now use cloud technology.
Plus, 53 percent of them have adopted a cloud-based practice management solution.
The report acknowledges that the adoption of cloud-based technology by tax professionals has multiple benefits.
“In addition to reduced costs and improved access, there are major client service benefits,” the report said. “Cloud technology allows real time two-way access between the practitioner and their client through a common data source.”
“One of the side effects of the introduction of GST was the need for businesses to update data monthly or quarterly,” he said.
“Cloud accounting accelerated this, enabling automatic updates and daily reconciliations. There is real-time visibility of data to the business owner, the bookkeeper, and the accountant.
“Having that updated data makes it simpler and easier to provide regular cashflow and budget reports to banks, decreasing their risk.”
Devine mentioned how real-time online data access smooths accountant workloads, too.
“You can prepare work in advance,” he said. “It can take five minutes to produce an end-of-year profit estimate then advise the client while there’s still time to act.”
“Tax return preparation becomes trivial when review and reconciliation is a continuous process. The integration of client accounting systems with practice management and reporting systems saves hours of labour.”
Kristy Baxter, a Chartered Accountant and director of tech-savvy accounting firm Pilot, has seen clients enjoy time-savings in many areas.
Baxter said that, beforehand, “The client would prepare a bulk lot of approximately 60 invoices near the end of the month. This would take almost an entire day, around seven hours, to complete.”
At that time, the client prepared invoices in a Word document, entered a summary in an Excel spreadsheet, and marked invoices as paid on that spreadsheet as money arrived.
But the move to cloud accounting made things much simpler.
“The client is able to copy previous invoices each month (invoices in their industry are usually progress payments but contain large descriptions about the jobs),” said Baxter, “and the cloud accounting software matches the invoice to the payment in the bank reconciliation.”
The same client also changed from a manual wages system. Previously, they tracked leave and payments in Excel then entered details into internet banking to transfer net pay amounts.
Doing things this way often led to errors between the different sources. It was time-consuming, too.
Once the client changed to cloud accounting systems, though, issues lessened with automation.
“The payslips are pre-populated with the employees’ salaries,” Baxter said. “The client uses an Australian Banking Association (ABA) file to transfer the net pay to the employee’s bank accounts.
“The BAS information pre-populates from processed pay runs, and the PAYG summaries also pre-populate from the pay runs and can be lodged to the ATO directly from the software.”
The time savings that the client has achieved have been impressive, to say the least.
“The client estimates that cloud software reduced the time she was spending on accounts, invoicing, and wages by 70 percent,” explained Baxter. “This delivered a gain of three to four days per month in time.”
Kristy and her colleagues at Pilot have also found that cloud accounting can assist with the sale of businesses.
“It’s much easier to access the data that potential buyers require to complete their due diligence. The data within the software is up to date and more reliable, compared to offline systems.”
Another plus from using cloud-based programs became evident during 2020 when Australian Government stimulus and concessions related to the global pandemic were made available.
“Software such as MYOB’s products allowed clients easier and quicker access to stimulus payments,” said Baxter.
“It was easy to assess whether a business satisfied the decline-in-turnover test and was eligible for JobKeeper, as well as assigning tiers to employees for JobKeeper 2.0 payments.
Clients were readily able to report employee payments to the ATO through single-touch payroll (STP), and provide turnover figures required for their monthly declarations.”
Another way technology has helped accountants and clients is through the introduction of bank feeds – where accounting tools, including MYOB’s products, “talk” directly to bank systems.
“Software imports a copy of an entity’s bank statements as data that’s ready to be coded up,” explained Baxter.
“The client or accountant can then set up bank rules. For example, each time there’s a payment to BP, code this transaction to motor vehicle expenses. The bank feeds also make reconciling the bank account easier, as you don’t have to wait for the end-of-month bank statement.”
Also, add-on apps have become a big help to business owners.
“Apps such as Receipt Bank, Spotlight Reporting, and Deputy can solve pain points for clients and help automate data entry, or provide real-time reporting on how the business is performing against KPIs,” said Baxter.
Get all the benefits of modern cloud accounting systems with MYOB AccountRight, now available from the browser, any device, anywhere.