Big Data is Making a BIG Change in Accounting

Data analytics, machine learning, artificial intelligence, blockchain, robotic process automation–these are just some of the tech trends that will continue to perforate the accounting sphere in 2020, according to a recent report by the Institute of Management Accountants (IMA).

The report highlights that finance and accounting professionals are increasingly implementing big data, and will continue to do so in the future. Respondents of the report included IMA members, including 170 responses from CFOs and other management accountants. Many of the surveyed CFOs and management accountants are predicting big changes for their businesses in 2020.

According to the report, four key elements must be present for an organization to be data-driven: quality data, data-savvy people, state-of-the-art tools, and a supportive organizational culture.

Management accountants are leveraging data science and analytics to improve their data governance and analysis capabilities. These are necessary skills that are increasingly expected from accountants; staying ahead of the tech curve is a necessity to remain competitive in the job market.

The report predicts that the number of companies deploying big data is expected to double in the near future. It identifies some considerations to help companies and accountants implement big data initiatives, such as:

  • Starting simple while first implementing big data
  • Getting buy-in at the executive and departmental levels for implementation of more robust data and analytics
  • Building quality infrastructure to ensure data integrity

The IMA is developing a Data Analytics and Visualization Foundational Certificate for continuing tech education to help accountants stay competitive. Seeking out tools such as these is paramount for accounting job security. As data visualization becomes a necessary part of many accountants’ jobs, the management accountant is expected to serve as a bridge between data scientists and management. A full grasp of tech and analytics is increasingly necessary. 

Flexi can help you adapt quickly to market or business changes

With quick implementation that can be deployed on-premises, in the cloud or in a hybrid environment, Flexi will not only simplify your accounting processes today, but also will have you ready to adapt quickly to market or business changes in your future. Flexi’s comprehensive financial management software simplifies and automates the entire accounting workflow process without compromising security. Flexi’s open architecture meets even the most stringent security requirements yet allows data to flow seamlessly with any system, whenever and wherever business needs dictate. Learn more about Flexi today.

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period accounting

What Exactly Is Period Accounting?

To understand, analyze, and strategize your business, you need first to ensure that your period accounting is correct. Period accounting is the time covered by your financial statements in the reporting period. 

Your period accounting is correct only if you ensure you are correctly deferring revenue and recognizing associated costs. Failing to correctly claim costs will cause a spike in your profit and loss accounts, rendering your analysis null and void. Analyzing numbers without considering their relationship does not provide you with the multidimensional analysis you need to succeed as a business.

It is common for businesses to split their accounting systems between two platforms, one for invoices and one for accounting. Neither platform on its own can provide you with enough information to fully analyze your business. For example: your invoice engine isn’t concerned with period accounting, and your accounting system only indexes costs by supplier, not split between contracts and projects or against sales.

Adopting a PSA (professional services automation) tool can act as a key differentiator for period accounting. A PSA tool will offer indexing capabilities that a traditional accounting system does not. Adopting a system to connect prices and asset values for all financial transactions is a necessary step. Being able to cross-index against the project or customer on which you’ve incurred costs gives visibility to the true customer margins. 

A PSA tool allows you to capture and control business processes to provide a full picture of your company’s profitability. These accounting events need to also wind up in your accounting system.

By using a model like the ‘null’ model, the invoice line trigger model, the invoice post model, or the journal post model, you can use your PSA tool to drive accounting processes to help you fully analyze your business. 

Flexi aims to simply accounting processes

Simplifying accounting processes to make analysis and strategy easy is Flexi’s goal. Trusted by enterprises for 25+ years, Flexi is among the most experienced accounting software providers in both the cloud and on-premise markets.

Submit your information and get a demo of the Flexi suite today. 


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