Oct 29, 2020Top Accounting Trends to Embrace in 2021
Some things never change. Debits will be debits and credits will be credits. Expense accounts will remain expense accounts, and tax day will always be on April 15th—okay, unless you’re in a pandemic. Though some argue that accounting hasn’t changed since the Roman Empire, accounting trends actually come and go out of style to match modern day business needs. Although you’ll never go wrong by putting the colored beads in the right place, you also won’t get ahead. Like it or not, 2021 is right around the corner (ahem, two months), and we’re here to give you a leg up on the best accounting practices of 2021 to adopt ahead of the curve.
#1 Rise of Data Analytics
Okay, not surprising. Data analytics has been on the rise for the last 15 years. Why is 2021 any different? Three words: cloud-based accounting. We’ll let you decide if that’s two words or three. The availability and ease of data processing can only lead to more accurate and frequent data analysis. With on-demand financial insights, your firm can identify operational inefficiencies, track clients’ progress, and develop accurate forecasting models. Good decisions are based on good information.
The upcoming year will also be a year of improved regulation and increased accountability for the accounting industry. Growing concerns over the collection, storage, and application of sensitive data require accounting organizations to be transparent about their data security practices. We may see more statements and contracts from financial services companies on how they handle sensitive data, giving potential clients greater insight during their search process.
#2 Cloud Accounting Continues to Gain Momentum
Accounting services and the cloud have become inseparable amigos. The growing popularity of remote workers across every sector triggers a need for enhanced fluency across time zones and Zoom rooms. While most accountancy firms depend on on-site services to manage sales and track inventory, the cloud provides a flexible and secure solution that supports modern work habits. On-demand data is becoming the rule, not the exception. According to Sys Group, over 85% of businesses worldwide are turning to cloud-based data storage methods. Although these companies don’t use 100% cloud-based infrastructure, it plays a significant role in business processes. As brick and mortar stores continue to rely on stagnant spreadsheets, overall efficiency is likely to decrease. 2021 is a great time to begin adopting cloud-based services as the “new normal.”
#3. Increasing Popularity of Outsourcing
The fire of outsourcing is raging, and more fuel will be added in 2021. In 2019, about 37% of small businesses outsourced accounting. A decent size. Since small businesses generally outsource for cost reasons, the companies usually opt for a freelancer. However, over two-thirds of businesses with 50 or more employees outsource accounting. If that’s not a trend, nothing is.
Why are more companies turning to outsourcing? Small business owners crave efficiency. The new business mantra of the day is, “Do what you do best and outsource the rest.” Efficiency often equates to outsourcing, especially when the outsourced service isn’t the favorite tool in the toolkit. If we’re being honest, unless you’re an accountant by trade, it’s probably not in your toolkit.
The opportunities for accounting outsourcing are about as wide as they are deep. One quick Google search will quickly reawaken your covid migraine by reminding you that there are at least ten thousand (maybe an exaggeration) third-party accounting services out there. We might be biased, but we think there’s something special about Nimbl. Instead of quickly passing companies to an online platform and leaving the scene, Nimbl takes time to develop long-term relationships, giving our clients premium access to reliable, certified accountants.
How to Stay Current
Our resource-rich world is loaded with exceptional digital content like podcasts and blog articles to give you quick and dirty tips on how to maintain credibility in the accounting industry. Stay tuned for more Nimbl content about some of our favorite accounting resources. In the meantime, we wish you the best as you tackle the trends of 2021 and prepare for the best business year yet.