Everything changed in 2020—the way we work, the way we shop, the way we learn, the way we socialize and celebrate, and hopefully, the way we look out for each other. 2020 has challenged us to adapt quickly and rethink everything.
And yet, in other areas, 2020 has changed nothing:
Manual effort is still the number one bottleneck in the financial close process
According to the ACCA, more than 90% of spreadsheets contain serious errors, while more than 90% of spreadsheet users are convinced that their models are error-free
Our global survey found that 55% of finance leaders said they were not completely confident they could identify financial errors before reporting results
And also that nearly 70% claim their organization has made a significant business decision with inaccurate financial data
The COVID-19 pandemic caught most F&A organizations unprepared for such disruption. Teams spent the early part of 2020 figuring out how to operate as a distributed workforce, before quickly shifting their focus to navigating the need for long-term resilience in their organizations.
As we look ahead to 2021, it’s critical to use what we’ve learned this year to prepare for the year ahead. Here are our predictions for accounting and finance organizations in 2021.
2021 Predictions for Accounting & Finance
The future of accounting is digital—traditional manual processes are not sustainable and unifying data and processes is essential for survival.
The pandemic didn’t care where you were in your digital finance transformation. Business changed radically, and so did the close, as companies had to shift to a digital model overnight.
According to a recent survey of F&A professionals by FSN, this led to unprecedented disruption:
46% were disrupted by manual tasks that could no longer be carried out in the office
41% were disrupted due to the difficulty of just sharing paper documents
36% were disrupted from limited access to on-premise solutions while they worked from home
The consequences are higher now for Finance and Accounting. Companies need timely and accurate data to make agile business decisions in this time of disruption, along with the expertise of their F&A partners.
And those accounting teams that are not prepared to adapt and scale, and that don’t have the ability to provide more visibility and analysis, are going to put their business at a competitive disadvantage. That’s another reason “the way we’ve always done it” will not work in this pandemic.
Manual processes take too long, create unnecessary risk, and hurt morale and productivity. Simply put, traditional manual accounting processes are not sustainable.
2021 will see the Controllership invest in technology to turbocharge their digital transformation journeys and move to a modern accounting model that unifies all of a company’s systems and data into a single source, automates manual, repetitive activities that drain time and energy, and provides real-time information and analysis to inform business decisions.
It’s no longer a question of if Accounting should digitize—but how best to do it.
Accounting is moving to a future where the close is virtual, automated, and continuous.
The virtual accounting function has arrived. The pandemic has been a forcing function, and now, according to Gartner, 74% of CFOs say they intend to grow remote work permanently. It’s never been more important for the applications accountants use every day to be responsive to the way they work.
Storing data in the cloud allows instant access to computing resources from anywhere at any time. Information is updated in real-time, which allows accountants to analyze and make decisions quickly.
Additionally, while initially it was only consumer software, business software will increasingly be available on mobile devices so that everyone from the Staff Accountant to the Controller can work smarter and be more productive, in the office, at home—from anywhere. With most audits still being conducted remotely, cloud technology enables transparency and collaboration between companies and their auditors.
Accounting and finance organizations will prioritize investments in hiring, developing, and retaining top talent.
Life is overwhelming right now. Everyone is being asked to do a lot more, stay connected 24/7, and juggle new pressures at home and work. Recruiting new talent was already an industry-wide challenge for Finance and Accounting before the pandemic, and now nurturing talent is more important than ever.
In 2021, F&A organizations will increasingly invest in tools and technologies that help their employees better manage their time, whether it be automation for repetitive, time consuming tasks, or collaboration solutions, which help teams find creative ways to connect.
As the world of Finance evolves, companies will need to find people with an increasingly diverse set of skills. As technologies such as the cloud, AI, and RPA become more widespread, organizations will begin relying on individuals who are motivated to learn new skills, focus on analysis, and embrace change.
Mindset & Modern Accounting Go Hand in Hand
Your mindset is key to your success in 2021. This year, we’ve been seeing a shift in mentality toward embracing technology for agility and collaboration.
We all had to more adaptable, as the way we worked changed overnight, and bringing that same level of adaptability into 2021 can help you move to modern accounting and drive finance transformation in your organization.
A modern accounting approach helps you close with confidence, advancing accounting despite disruption, and providing a foundation for your team to adapt to changing circumstances with collaboration, visibility, and control. It is the way forward for Finance and Accounting organizations who want to stay competitive and thrive in 2021.
Read this white paper to learn how to build an agile, resilient F&A organization that is better prepared to adapt to changing demands.