Working with – or against - the robots: The choice for accountants

Are the robots finally here? Are they about to replace accounting practitioners?

It’s been an ongoing topic of discussion for a couple of years now – though evidence of precisely how accountants’ demise would occur has been diffuse … and difficult to pin down.

But it could be the future of accounting platforms such as Xero and QuickBooks, including the direction of travel of the plethora of apps that are accessible through them, that dictates the likelihood of accountants being replaced.

They are certainly creating a buzz around their sophisticated level of functionality and how that may develop.

My good friend Nick Levine, an experienced tech-focused accountant alongside others, has pointed to online platforms making acquisitions that boost their inbuilt tool set.

Alongside that development, we’ve seen app providers gaining access to millions of pounds of funding as they look to broaden and improve their offering. With the lending market opening up, plus closer links being made between bookkeeping, banking and subsequently lending/finance, there is a possibility that clever algorithms could help even small businesses receive a more detailed level of support than expected.

Will the robots win?

A simple example would be a cashflow app that develops close links to the lending marketplace. From ‘looking’ at a client’s books it may be able to alert them that they will need extra working capital – and then offer them the optimal option, all through a mobile phone.

Many accountants are still getting to grips with using technology to keep up with MTD and other compliance requirements – let alone leveraging it to improve their advisory offering. It’s scary to think that an area such as finance may be accessed directly by clients, prompted by an algorithm.

So…will the robots win, and beat accountants to advisory? Yes, and no.

It all depends on whether you decide to act or not. For practices that stand still, fail to understand their market, their offering, their processes and people, they simply won’t pick up the new wave of clients who are used to electronic-focused services. Clients who trust their mobile phone to control their banking, expenses and invoices.

Supported by technology, rather than replaced

Of course, existing client bases won’t retreat en masse. But these practices will grow more slowly, will erode their margins as it becomes more difficult to keep up with tech-focused regulatory requirements (eg. MTD) and potentially fail to recruit the right people.

And with the example of accessing finance, surely it would be better for a client to work closely with an adviser to make a considered decision about their options – supported by technology, rather than replaced by it?

I see it as polarisation. Those firms that embrace change and take advantage of the momentum behind back-office SME accounting tech will thrive. Those that don’t will wither on the vine.

Exciting or terrifying? The choice is yours.

Kevin Reed is engagement and communications consultant at Foulger Underwood