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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.

Have you decided to outsource your accounting work yet? 

Is your self-assessment tax due soon, or are you facing difficulties with your annual return? These uphills are a few of the most common challenges faced by companies in the UK. Self-assessment tax and annual return are the top challenges, and many companies in the UK, small and large, start worrying about these once the tax season comes around the corner. Some companies, especially SMEs, do not have a budget set aside for hiring Accountant outsourcing with the required skills, and the inadequate resource pool doesn’t help any further. If you are one of these companies, have you considered outsourcing your accounting and bookkeeping function to stay clear of these complications? Self-assessment tax and annual return outsourcing, tax returns outsourcing is not a new concept in the UK market. It helps businesses focus more on their core processes, staying away from tedious manual tasks. 

 

 

Why outsource? 

Outsourcing is on a rise in the UK accounting space, with the primary driving reason being cost savings. Not all companies can afford to have a dedicated team for managing internal finances and accounts. Moreover, nothing is better than having a team of experts at your disposal to handle the tax function, resulting in continuous growth for your business. Therefore, outsourcing a long-term business investment. The reasons to outsource accounting and bookkeeping can be many; we have compiled some of the top ones in the below list. 

 

  1. You can focus more on your core competencies 

When you run a business, you need to take care of several processes; accounting is only one of the main aspects. However, if you are an IT guy, you will take time or even face difficulties with self-assessment tax and annual tax returns. This will also be time consuming. So, it’s better to outsource bookkeeping to a specialist provider who can do the taxes on your behalf. Self-assessment tax and annual return outsourcing will free up more time for you to focus on your core competencies and the other core processes of your business apart from outsourcing. 

 

  1. You can reduce employee costs 

With outsourcing, you can completely eliminate employee costs, including money spent on training, wages and benefits. When you decide to outsource accounting and bookkeeping, you save 30-40% of the costs spent on hiring new employees. With reduced employee costs, you will have more capital on hand to fulfil other business requirements. 

 

  1. You will face fewer frauds and risks 

Employees are your assets, but they could also be your biggest liabilities. Many companies across the UK have reportedly faced employee frauds. According to Action Fraud, UK businesses faced employee frauds amounting to £88 million in losses in 2017-18. Therefore, it is a smart move to outsource accounting and bookkeeping to a specialist provider so avoid losses due to frauds.    

   

  1. You will shoulder less tax burden 

If you don’t know when or how to file your self assessment tax or prepare your annual return, your business can face severe risks. There are tight deadlines to follow and several other timely formalities to fulfil. All of this can be really time consuming as well as confusing. Therefore, it is a safer bet to resort to self-assessment tax and annual return outsourcing rather than struggling to make things right. Using the services of an expert will also help you easily get over tax hiccups (avoid penalties) and even deal with the constant changes made to state and national tax laws. 

   

  1. You will have access to the latest software and technologies 

The business landscape is continuously changing, with new technologies and software tools being introduced every day, but these come at a cost that is not always possible for every company to manage on its own. When you outsource accounting and bookkeeping to a specialist provider, you get seamless access to these technologies and financial tools, on a usage basis, without having to invest in installation and maintenance. All you pay is a subscription fee to the service provider.  

 

Conclusion 

The idea of outsourcing the accounting function is often associated and marred by several negative connotations, but the benefits of outsourcing far outnumber the grey undertones. Therefore, the decision to outsource your accounting work will not only help grow your business but also result to more profits.   

 

Website: outbooks.co.uk