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We are officially in the era of digital transformation where technology has greatly impacted audit processes. This has ushered changes that were hard to imagine as possible about a decade back. While the accounting profession has by and large embraced technology in various processes, it was restricted to the documentation, calculation, stor age and retrieval process. However, this is all set to change as cutting-edge technology dons a greater role in auditing. The clamour for different reporting and financial statements has been growing, and technology has all the right answersv. Taking a leaf out of fintech companies for development of intelligent software Bookkeeping outsourcing company in uk. Processes that will be touched by technology will include those areas where it may be necessary for a machine to understand and use that knowledge to identify complex information. Fintech companies have been able to deploy automated solutions by leveraging the power of AI and machine learning. Auditing will similarly find a greater role for technology, beyond the present functions. For instance, technology has developed to a level where it is possible for AI powered systems to look at all the data of a company that is being audited and identify anything that is amiss. This will help auditors to turn their focus to flagged areas that need more of their attention. Evolving reporting requirements Bookkeeping outsourcing company Present audit reporting helps investors and shareholders understand the financial health of businesses. However, in the context of a data driven world with more and more information available, there is an increasing chorus for auditors to share additional information. Stakeholders are of the opinion that auditors possess more information, than what is actually reflected in the reports. And the demand is for more contextual information from auditors about how a specific conclusion was made or arrive at. Readers want to know how the auditors arrived at a conclusion. This open the floodgates of confusion. Auditors crunch numbers and make conclusions, expecting a reader to do the same is an invitation to chaos. However, technology has the ability to present relevant information in the right form for dissemination, that is in alignment with the overall findings/conclusion. Impact of revisions and penalties corporate secretarial services in ukThe Financial Reporting Council released revisions to International Standards on Auditing (UK)[1], which had more to do with the Code of Ethics. This has great significance for auditors and by extension the companies that are being audited. The changed standards, despite being limited in scope can have implications for stakeholders. This needs to be read in the context of the fines levied by the FRC, on some of the top global auditing firms for misconduct. Even as the dust began to settle over the fines and the circumstances surrounding it, most of the iconic and respected auditing firms commenced an overhaul of their systems and processes, bringing in more technology driven processes to strengthen existing processes. This will be the order of the future, as auditors look towards technology for greater compliance. Moving from sample testing to testing of all transactions In the future, auditors will harness technology to carry out checks of all transactions, and not just rely on a sampling or random check of transactions. While the certainly humungous volumes of transactions may have come in the way of checking out all the transactions in the past or the present, this is all set to change. With the use of the right technology, not only will all transactions be checked, they will be completed at high speed, which means that the process of checking will not add to the time element. And this aspect of checking all the transactions will help auditors to gain more insights about the financial health and other inputs about the organization and the domain it operates. This will be invaluable to investors and shareholders who will now be able to understand reports on the basis of checking all transactions and not just a sample. Sampling has a probability of error, which will be corrected in the future. The need for speed The new techno-social order has turned time on its head. Processes that once took a specific period of time has now been shortened drastically. As a consequence, all other allied processes and procedures are also expected to commence/conclude at proportionate speed. Effectively, this has led to a cascading effect. Audit, resultantly, requires to be concluded faster than ever before. Manual processes do not stand a chance of delivering results at speed or with the accuracy and precision required. While it is impossible for technology, as it stands now, to replace the power of human intuition in tasks as complicated as auditing, many of the tasks that are repetitive or rote in nature need to be entrusted to technology and automated processes to be able to meet the deadlines. Leveraging the power of blockchain for cost effective audit processes Blockchain is the buzzword that will continue to hold sway over businesses well into the near future. And by virtue of being a distributed ledger, blockchain is the natural bedfellow for auditing processes. Auditors need not seek information or wait for clients or third parties to furnish statements, or any documents for verification and cross-verification. Auditors can simply carry out the verifications from blockchain ledgers. With the power of offering verifiable and immutable transactional information, these ledgers will save a lot of time and money, in addition to the assurance of offering information that is accurate and free from errors. This is basically, because the transactions themselves would have been carried out only after fulfilling the criteria or conditions of all –parties involved in the transaction. Analytics only as good as the data that is fed Analytics can be only as good as the data that is fed, which means that standards also need to improve so as to offer data that is of the right standard. While systems will be powered to detect anomalies over entire transaction history, the advantage of perception that is available to the human mind and the logic of perspective will be unavailable to technology driven systems. This will make it mandatory for records to conform to certain standards. The quality of the data and the processes or technology that is available to bring in the data from many sources needs to be advanced so as to prevent gaps in data capture and its use. The need for more regulations and standards Past processes had stakeholders trying to catch up with the regulations and standards. For instance, auditors and organisations had to fulfill or meet the standards and regulations as laid down and the need of the hour used to be a scramble to meet the standards. However, with changes in the way business is conducted, there are multiple issues which cannot be met or fulfilled by existing standards. This turns the whole equation of regulations and standards on its head. Regulations and standards are now expected to keep pace with the developments and evolving changes in the world of business. Till the regulations and changes are in place, auditors and businesses will have to work within the contours of existing regulations which may not be very easy considering the inherent differences among domains. Conclusion: Auditing is a proven facilitator for growth, in addition to meeting the requirements of accounting and financial reporting. While nations have their own set of policies about the size of businesses that need to be audited or not audited, it is a proven fact that auditing is one of the pillars of growth of a business. Technological innovations will assist the acumen of humans to bring about greater accuracy, improved reporting and faster conclusion. Auditing will not be limited to random checks but will encompass the whole history of transactions for specific periods. Contrary to popular belief, technology will not take the place of humans, but will help humans in their deliverables.

Common Pitfalls Among Accounts Outsourcing Companies




Accounting may not be a key skill for you, or you don’t want to focus on anything else other than your core business or simply want to cut down cost – the reason for outsourcing your accounting services could be many and is a good move. You just need to be sure you have thought through the checklist well, before finalizing the vendor. Very basic, though there are points that get missed by many companies while outsourcing their accounting, resulting in a failure. Here are some common ones. 

GDPR – is your accounting OSP following this? 

Accountants have access to a lot of data on a daily basis. The accountancy outsourcing provider needs to be sure that their processes and systems are robust to comply with the GDPR. The required audit and checks should be in place to ensure there are no loopholes in the compliance. So, before you move ahead on further discussions with your vendor, the first thing should be to check their GDPR audit reports. 

Missing on your homework 

Your final goal, objective for outsourcing accounting and key criteria to choose the Accountant outsourcing provider should be clear, documented and well researched. Researched – to be sure that the goal you are setting will be achieved by your objective of outsourcing your accounting or bookkeeping company in uk and the vendor criteria you are defining is being met by your shortlisted vendors. At each level, you should be evaluating multiple options, even when you are doing your final negotiations with the vendor. Keep doing your homework to be able to present your case better and be sure the accounting OSP (outsourcing service provider) you are choosing is the right one. 

Defining ‘Cost’ the decision point 

It is fine to keep ‘cost of the services’ as one of the evaluations criteria but making it the decision point isn’t a smart choice at all. While most of the companies wouldn’t keep it on the list, but they end up choosing the vendor on ‘a comparative lower cost’. It is important to have the exact services you will be getting for the amount in black and white. A lower cost will always mean a few excluded services or a compromise on quality or the OSP’s experience. For example – you may not get some add on services or may be dealing with a junior resource which will eat up more of your time. So, while you are saving a little amount, you may be spending more of your quality time in return. Hence be sure to know what your will for a lower price and decide based on the services and experience rather than the cost. 

Choosing a ‘Lift & Shift’ model 

You want to outsource accounting either as you don’t have skills, or you want to cut down cost on this non-core skill. To be sure you get the right skilled people working for you at the right price it is important to know your accounting outsourcing service provider’s expertise. What type of associates and what skilled will be managing your accounting should be your question. 

You don’t want to become part of a lift and shift model which shifts all your accounting services to an offshore location to help you cut cost however not necessarily these outsourced locations will have people trained to be able to manage accounting for you without errors. So, your team ends up managing them indirectly making them spend their quality time on it anyway. 

Trust the documentation, Not words 

When outsourcing, the access to data is no longer restricted to only company employees and the vendor’s employees will be able to view the same. Storing and processing of sensitive data, and protection of proprietary information becomes challenging. Every OSP will tell you they will ensure data security, but breaches happen. Don’t they? 

As a client you need to dig deeper to understand the exact processes they follow to ensure data security and confidentially. Have the process documented, involve your IT security guy and ask the OSP to make tweaks to incorporate the suggestions. Know the implemented security controls and protocols for data security and put them as part of the legal and contractual agreements. 

Mis-alignment of Requirements 

Outsourcing Accounting or self-assessment tax return is a serious decision and all checks need to be in place before deciding the vendor. It is essential that you align your requirements with the partner vendor’s capabilities. Issues arising because of legal and contractual agreements not being comprehensive can cost your company more time and money. It is also important to agree on the tracking and evaluation mechanism beforehand so that the performance and errors can be checked at the right time. 



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