In recent years, advances in technology have driven huge change in the accounting world. The rise of cloud-accounting means tasks that once involved piles of paperwork and hours of manual processes can now be done with much more ease and speed.

Accountants no longer need to spend hours inputting data and collecting receipts. Software like Xero automates basic tasks such as payroll and reconciliation, and streamlines compliance, making filing VAT/GST and income tax returns quicker, simpler and less error-prone.

During Covid-19 people increasingly saw the value of cloud accounting, which makes remote working and collaboration simple. And with the roll-out of Making Tax Digital — the Government’s plan to digitalise the UK tax system — cloud accounting is fast becoming the new normal.

So where does automation leave the role of the accountant? Far from making your role less vital, technology allows you to be more valuable than ever to your clients. The automation of routine accounting and compliance tasks saves you time and hassle – freeing you up to concentrate on other services. This comes as clients increasingly want more from their accountants than just help with an annual tax return – a shift accelerated by the pandemic. With so much economic uncertainty over the past two years, small businesses have relied on their accountants for informed advice on how to weather the storm.

Increasingly, businesses and sole traders expect accountants to be much more than number crunchers. We’re moving towards a model where accountants focus on providing insight, not just services like taxes and bookkeeping.

Software like Xero has empowered businesses to take control of their finances and given them more transparency of their numbers. With more data at their fingertips, business owners want to know what it all means — namely, how they can improve their profits and grow. Clients want accountants to help them make sense of their financial data so that they can make better business decisions.

Accounting is no longer just about looking backwards and reporting historical data — it's about using that data to give clients insight and advice on how they can improve their business performance in the future.

To continue to thrive, accountancy practices must be proactive, not reactive.

Reducing time spent on repetitive manual tasks allows you to focus more of your resources on advisory services, adding value, and building a stronger relationship with clients.

But technology not only gives accountants the extra time to offer valuable advisory services — it also gives you the tools to do it too. For example, Xero can give you a real-time view of your client’s financial position so you can help them make smart, data-informed decisions about their business.

Companies like Syft Analytics allow you to go even further, with AI generated insights and analytics to improve budgeting and forecasting. The app integrates seamlessly with Xero and transforms accounting data into easy-to-understand financial reports and insights. It helps you clearly visualize data in customizable graphs and dashboards, bringing financial data to life and making it simple to explain to clients.

You can consolidate multiple Xero entities into a single entity, compare performance to the industry, create financial forecasts or budgets and estimate the value of your entity.

Shifting to a more advisory role helps you to have a more rewarding relationship with your clients. Instead of just checking in once a year when the tax deadline is looming, you can set up regular meetings. You’ll get to know their business better, understand their financial goals — and help them to achieve them. Technology gives you both the time and the tools to do this. Improved relationships with clients means more client retention and the chance to grow your business through word-of-mouth recommendations.

Moving into advisory services won’t just help clients to improve their business, it will enable you to grow your practice, too. Advisory is an area with huge potential.

While it may feel daunting that a lot of traditional accountancy tasks can now be easily automated, the truth is that tech can never replace accountants. Interpreting the data and offering advice to clients is a skill no robot can replicate. Clients need you to help them make sense of the data, tell the story behind the numbers, and offer actionable insights. Syft simply gives you the tools to make this easier, while software like Xero boosts your efficiency and gives you the time to do it.

Accounting is changing, but as long as we embrace the changes and use new technology to our advantage, it's something to be excited about.

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​Written by The Xero Team

Xero is an easy-to-use accountancy software platform for businesses and advisors.