Understanding Accounting Automation
Automating your accounting firm operations can boost productivity, both at the individual and business levels.
For accounting firms, using a particular software or a combination of them can lend a competitive edge. Clients today demand faster turnaround time, enhanced customer experience, reliable advice, and increased accuracy in calculations - and automation is the answer. Simplifying operations by using technology also makes your organization more agile. It can help you weather economic and technological disruptions with resilience, thus paving the way for scaling operations.
What is Accounting Automation?
Accounting automation is using technology and software to automate the routine tasks of a practice that were done manually.
Benefits of automating accounting firm operations
By leveraging technology to simplify operations, you can free up your team’s potential for more strategic roles. It lets you “set and forget” certain aspects of the business, according to a Forbes article. Here are the numerous benefits that come with automating your operations:
Increased efficiency
Automating data entries and integrating them with bank accounts and receipts can help with faster calculations. You can also autopilot repetitive tasks like invoice generation and approval workflows.
You communicate with clients faster, approvals occur along a chain, and you get paid faster. Some modern tools learn from previous transactions and automatically categorize expenses, saving time.
Improved accuracy and reduced errors
Using pre-fed formulae and logic, automation tools ensure error-free calculations and peace of mind. This saves you costs of errors, including correcting them and potential damage to brand reputation.
Accuracy also aids regular reporting of metrics. Further, it also reduces audit crisis and regulatory violations.
Cost savings
You may not require additional staff for data entries. And you could redirect those resources into client relationship management. Automation also reduces costly errors that may incur legal costs or even lead to client churn hurting your revenues.
Further, cloud-based automation solutions require minimal setup and only continuing subscriptions and maintenance costs. Next, they also reduce operational risks that come with relying on individual employees for critical tasks.
Scalability
Most automation tools let you handle larger volumes of work without increasing the workforce. This allows you to service a larger pool of clients without compromising service quality.
The time saved using automation can allow your employees to focus on high-value activities like client advisory services, strategic planning, and business development, which are important for growth.
Many tools facilitate easy data migration from existing systems and ensure client data's safety and security. The cloud-based tools can be easily expanded based on growth plans and seasonal variations.
Enhanced customer experience
Your customers get faster responses, including receipt generation and updates on tax filings. On self-service portals, your clients can chat with the firm, upload files, sign contracts, and view updates in real time.
The reduced errors, which come with automation, also boost your brand image. The enhanced security features secure client data, making them immune from manual manipulations.
Automation also lets you personalize the customer experience. These could include automated reminders on deadlines or emails with identity details of clients. According to Zendesk, personalization makes customers feel more valued, which furthers brand loyalty.
10+ Accounting firm automation examples and ideas
Automation of operations in accounting spans across different functions, from improving operational efficacy and enhancing employee experience to improving client relations. Here are a few use cases:
Client onboarding
Some automation tools let you draft proposals in minutes. Further, the integration of proposals, billing, and payments on a unified platform onboards the client faster. You may also customize onboarding workflows and create approval chains.
Also, learn about how to write a proposal using this sample bookkeeping proposal.
Automation software also lets you integrate your sales pipeline with quote generation for greater conversions. The sync with your emails allows you to extract client data in real-time to communicate efficiently with them.
With Cone, you can create web proposals and contracts in less than 10 seconds. You can customize templates to reflect your brand values. The e-sign feature on the solution helps you onboard clients faster.
Learn more about how to effectively onboard clients using the bookkeeping checklist.
Invoice processing
You don’t have to manually key in data in invoices, as automation integrates with document scanners and bank feeds. Technologies such as optical character recognition auto-populate invoice fields.
Getting approvals becomes easier and faster, too. With defined approval chains, invoices are routed to appropriate reviewers based on the department or the vendor. This creates transparency and leaves an audit trail. Tracking time also becomes easier.
Such software allows for the scheduling of payments, too, which saves costs in late fees and penalties.
With Cone’s bills and payments solution, you can automate your invoice management and save up to more than 40 hours a month. The solution lets you handle all client bills in one place. You can even create invoices from proposals automatically.
Other tools include Airbase and Stampli
Bank reconciliation
Automation makes bank reconciliation easier. Pre-configured rules can automatically pair bank transactions with corresponding entries in your accounting solution.
Such technologies also help flag any discrepancies based on unmatched transactions, even categorizing them on potential causes such as outstanding checks.
Automation improves accuracy in maintaining client data and averting errors. Tools such as BankRec can help match different sets of transactions.
Payroll processing
Automating payroll includes automatically calculating salaries, taxes, and deductions. This reduces the chances of manual data manipulation and human errors in data handling.
You can also schedule payroll releases to ensure timely payouts. Payroll software lets you manage different employee categories—remote workers, contractors, and full-time workers—using a single platform.
On some platforms, self-service options allow employees to access payslips and tax forms and review deductions and bonus calculations for accuracy. Payroll software may also be integrated with the human resource management system (HRMS). This links time, attendance, and performance management data with payroll data for real-time calculations.
For instance, Multiplier offers payroll solutions for global teams. Other payroll tools include Rippling, Deel, and greytHR.
Compliance and auditing
Leveraging technology to manage data lets you analyze them for potential risks and areas requiring closer scrutiny. Some tools also let you conduct automated sampling and testing to maintain data hygiene.
Automation solutions help you generate reports based on variables like time frames, functions, and account managers for greater scrutiny.
When clear communication and approval channels are set up, an audit trail is left. You can review the steps of an action—when it was taken, by whom, and at what time—and track processing times.
Simplifying workflows
Automation software enables efficient project management by providing templates, reminders, deadlines, lists, and board views. You can also track time on triggers like client requests or reminders to gauge efficiency.
More importantly, software like Cone lend clarity to job roles and boosts accountability. It becomes easier to align employees on a process and guide them with next steps.
Pro Tip: Learn more about virtual assistant services specifically tailored for CPAs and accounting firms to outsource some work.
Creating proposals
Proposals are among clients' first touchpoints. Automation tools not only let you draft proposals from templates, but they also offer workflow options, integrate e-sign options, and offer automatic billing and auto-sync.
With Cone, you can create branded proposals and edit them. You can also prioritize, quality, and create proposals by reviewing the sales pipeline. You can also generate quotations faster. Other tools for this use include PandaDoc and Qwilr.
Cash flow management
Through automation, you can track your accounts payable and receivable more efficiently. You can schedule payments and reconciliations to maintain adequate balances. Tracking spending trends also becomes easier, allowing you to identify areas for cost savings.
In addition, you can enable automated expense reporting and approval flows to check discretionary spending. Automation lets you automatically send invoices to clients, follow up on due payments, and integrate payment gateways for faster payments.
The real-time dashboard helps you track expenses against budgeted amounts. The data overview lets you forecast flows with greater accuracy, predict assets and liabilities, and spend prudently.
Also, learn about the importance of workflow management within your accounting firm.
Employee experience
Automation can improve your employee engagement and boost morale. By automating various parts of an employee's journey from hire to retire, you save HRs’ time and efforts.
On HRMS software - you can track recruitments, track time and attendance, manage performance, and offer employee benefits in an integrated way.
Tax preparation and filings
With the automation tool, your clients can safely upload documents and communicate with you. Automation calculates taxes automatically, and you can even send automated reminders to your clients.
Certain tax planning software helps you analyze client data and identify tax planning opportunities.
Pro Tip: Also, learn about different accounting firm structure as the way you build your practice also has a profound impact on your business.
Seven tools, One platform
You don’t have to stack up software to automate operations. One unified solution, Cone, can help you simplify multiple tasks across your client’s journey. The platform can get you 27% more in revenue and increase your productivity by 50%. The integrations across solutions, you can move data easily and securely.
Here’s what automating operations with Cone looks like:
- Manage projects
Plan and manage projects, track time, and manage documents. Use templates, reminders, deadlines, lists, and board views to bolster transparency across teams.
- Draft proposals
Create branded proposals that resonate with your clients. Create approval workflows and integrate e-sign.
- Client portal
Clients can chat, make payments, upload files, submit forms, and sign contracts from here.
- Generate invoices
Automate billing and payments relating to all your clients in one place. You can automatically create invoices from proposals.
Kickstart your automation journey today.
Frequently Asked Questions
How is automation used in accounting?
Automation takes over manual tasks like data entry, invoice processing, and financial reporting. It reduces manual errors and optimizes workflows. Accounting professionals can use the freed-up time to enhance client experience and provide them with data-backed advice.
Are CPAs going to be automated?
Certified public accountants are using automation tools for routine tasks so they can focus on personalized client advice, informed decision-making, and interpretation of financial information. With automation software, their judgment and contextual awareness are pivotal. The software complements and empowers the accountants to provide better services.
What is the best technology for accounting firms?
The best technology for accounting firms varies with their size, industry segment, and markets. However, Cone offers unified automation software to cater to various kinds of accounting firms. The unified practice management and proposals software help you draft proposals, simplify workflows, manage projects, service client requests, host payments, send emails, and track time. Cone empowers your clients through a portal to place requests and track updates.