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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.

Taking the Pain Out of Small Business Payroll

Small businesses will have a smaller team and hence lower bandwidth. Following the strategy of managing with required employees, having someone with a niche skill of payroll may not be possible and assigning it to someone who isn’t an expert can lead to major errors in pay management. Above this managing payroll in-house is even more complex because of tedious taxation processes and compliance management. Any mismatch leading to taxation errors or compliance will lead to sorting it with the Government, which any small business wouldn’t want to get into. And if there is an error in the pay, you will be upsetting an employee and losing trust.

 It is a good practice to have experts work on tasks that you are not too sure about. You can choose to outsource the work to a payroll outsourcing services provider or simply choose an accountant who can take care of this more effectively as compared to your training or hiring an employee internally for this task.

 Payroll outsourcing could be expensive but small business should look at the bigger picture. You don’t have to train or monitor someone in-house, you are letting experts manage compliance obligations and ensure tax adherence. They can help you in setting up best practices based on their experience with handling payroll for companies like you. So overall other than getting your payroll managed, you let go of related nuances and at the same time learn from experts. Real-time reports and anytime access to data comes as part of the package so unavailability of data or no control is out of the question.

 Having said the above, outsourcing may not be a fit for all organizations depending upon their style of business. It is still a good idea to evaluate it. Speak to a few payroll management service providers. Know about the benefits in black and white and re-evaluate.

 To be sure you get rid of the pain of managing payroll it is important you choose the right outsourcing partner. Here are a few checks and considerations when you plan to outsource.

First thing first, know your exact requirement

Defining the exact services you need is essential. You need more than just payroll management for sure. Importing pay figures, incorporating bonus amounts or requiring the pay data to be accessed by senior management at any time are important services that you need. Ask these specifically and look for a payroll service provider who can adhere to your requirements. Also based on your company size, industry or payroll schedule your needs will be unique so don’t go by a generalized service package. Know about all types of services the payroll outsourcing company provides and asks for customization if the standard doesn’t fit you.

 Which right is your right?

There are a plethora of payroll outsourcing and accounting outsourcing companies and each claiming to become your ‘right’ outsourcing service provider. It is your job to choose the best out of all. The only checklist you should have is ‘does it fit your requirement?’. It may have the best of clients but are you comfortable with their services, their policies, costing and do their experts give you the comfort that they will be able to handle your payroll. This is the time when you need to scan them from all angles as you are choosing to outsource a critical portion of your business.

 

Update your data

The payroll service provider will take care of everything related to payroll but check if they will help in creating a proper data repository with past data for you that can capture end-to-end employee record and pay and bonuses and more. It will be a good idea to clear off the past data as well. You should also ask your current payroll manager to collect and have the data ready of the past 1 year so that the same without any hiccups can be shared with the payroll service provider during the transition.

 Is the outsourcing company technology-oriented?

The need and demand of the services world is changing. Now you have a few offices, tomorrow you may have many in different countries with your staff working from multiple locations and even working on the go. How would you ensure that the data from all these different locations is collected, is on time, is precise and calculates payroll based on rules as per the specific location? Even if there are people working specifically on this it is daunting to have an error-free data in place. This is very technology comes in handy. Put this requirement in front of the payroll outsourcing partner you are evaluating. See how well they decide to use technology to cater to this scenario. If they don’t plan to do use technology to cover this scenario then they aren’t your right pick.

Data confidentiality

With technology, there comes many benefits as well as a few challenges. Data leak is easier now with data available on the internet. Also as you may be managing the payroll for multiple offices, confidentiality needs to be stronger. One of the main concerns a small business is sharing the data with a 3rd party with the concern that it may get shared by someone unwanted. When evaluating a payroll outsourcing provider it is important you thoroughly understand their processes and plans to manage your data. Look at their security certifications and regulations that they follow and then decide.

It is important for a small business to know the pros and cons when outsourcing payroll. The benefits are more undoubtedly if the checks are kept on. Communications, data access, compliance adherence, confidentiality, transparency and expertise play an important role. If these are taken care of well then the small businesses will have an easy way to get the pain of payroll management off their head and focus on core items.

BY:  Amit Agarwal

London 

Suite 7, First Floor, Amba House, 
15 College Road, Harrow 
Middlesex - HA1 1BA 
Registration No: 10746177 

 

India 

Gurugram 
Unit No.110-111, Spaze IT Park,  

Tower b4, Sohna Road 

Gurugram, Haryana - 122001 

 

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