What will this year bring to your business accounts? The COVID-19 pandemic caused big changes to the economy in 2020, accelerating already growing trends like remote working, risk management, and automation.
It’s important to keep an eye on these emerging trends in finance so that accountants can be better prepared for what comes next. Here’s what all accountants should be aware of for 2021.
1. Remote working isn’t going away
Through a series of lockdowns and temporary office closures, many accounting teams worked remotely last year. That trend is here to stay for 2021, with over half of accountants predicted to continue working from home. Technology has grown alongside this trend to meet the challenge, with improvements in video technology and online chat services. A recent World Economic Forum (WEF) Report showed the 85% of employers are poised to digitise their working process going into 2021. In fact, the pandemic has shown us just how well businesses can work with remote teams, particularly those using cloud-based accounting systems.
Going forward this year, the challenge to overcome is finding new ways to boost employee engagement despite a lack of in-person contact. Accounting teams need to find new ways to boost company culture and establish strong working relationships with clients at a distance, through virtual events and the right technology.
2. Businesses need advisors more than ever
Flexible businesses that have shown they’re able to adapt have weathered the storm of 2020 most successfully. Small business financing trends show that business owners are more interested in receiving advice from accountants, particularly when it comes to things like cash flow forecasting. Business owners want to find ways to protect their positive cash flow this year, giving them the ability to ride out sudden fluctuations in the market. Accountants can focus on financial advisory services, adding areas like tax planning and budget growth reports.
Another business finance advisory area that seems poised for growth is Enterprise Risk Management (ERM). Business owners are rightfully worried about the impacts of another sudden crisis and want to mitigate this risk. Financial advisors should find new ways to assess risk in the supply chain, looking for ways to minimise issues before they happen.
3. The future is automated
There are plenty of accounting tasks that are based on formulas and algorithms, and increasingly, these can be handled with automated software. Office automation software offers a way to streamline repetitive business and finance tasks, providing detailed reports for accountants to analyse. Automation offers a wealth of benefits, not only saving time but also minimising user errors.
Accountants should keep on top of these automation trends, upskilling to learn how to use the latest software and finding ways to eliminate slower-moving processes to boost productivity. Automated payments can boost cash flow, with invoices electronically stored and approved for rapid cash inflows and outflows.
4. Sustainability measures add benefits to reporting
There has been a growing emphasis on corporate responsibility for several years. However, paying attention to social responsibility and sustainability now offers several benefits from a small business finance perspective. As a result, accountants should learn the latest rules of Environment, Social and Governance (ESG) reporting.
Small business financing trends include the implementation of cost-saving sustainability measures. A reduced carbon footprint in the office also saves money on utilities and supplies, while boosting brand reputation. Accountants will need to look at new ways to integrate sustainability trends with financial reporting.
5. Information security is a key issue
Finally, along with emerging trends in finance like remote working and automation comes an increased need for online security, particularly when it comes to payments. Data breaches threaten not only employees but also a company’s customers, which can cause the business’s financial stability to crumble from the ground up. Financial advisors should have a working knowledge of basic information security, particularly when dealing with sensitive accounting data. Analytics tools, document management, and fiscal reporting software needs to be adequately protected with encryption.
While it’s impossible to fully predict the future, by keeping up with these core trends, accounting teams can be better prepared to meet client needs this year and beyond.
We can help
GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Find out how GoCardless can help you with ad hoc payments or recurring payments.