In the ever-changing world of accounting and finance, staying ahead of the curve isn’t just a strategy — it’s a necessity. Even as we hit the quarter mark in 2024, it’s never too late to delve into accounting trends that can help your business today and the rest of the year. Accounting automation, AI integration, outsourcing, and data security are among the key topics reshaping the way businesses manage their finance departments.
Adapting your strategy for 2024 may involve seeking new qualified finance and accounting staff to supplement your current workload, support in-house projects, or manage everyday tasks. HUGO by RGP can assist in finding skilled finance and accounting individuals effortlessly.
Explore the top 5 accounting trends and financial services to keep your eye on this year.
Increased Automation with AI
Developers have been harnessing machine learning (ML) and artificial intelligence (AI) for years, but the mainstream adoption of AI skyrocketed in 2023. Employees across various industries and departments have found valuable ways to integrate AI into their daily work, automating tasks and boosting efficiency.
The finance function is no exception. AI has enabled significant automation in accounting processes, leveraging large language models capable of swiftly analyzing vast datasets. This capability has expedited tasks traditionally requiring extensive time investment.
Utilizing this technology can also enhance various financial tasks such as budgeting, pattern identification, bookkeeping, and risk assessment.
As efficiencies are gained, finance professionals will be better positioned to focus on strategy and long-term projects that contribute to company growth.
Blockchain Technology
While AI garners attention, blockchain technology is emerging as a transformative force in accounting and finance in 2024.
Blockchain operates as a decentralized ledger recording transactions, offering heightened transparency and security in financial transactions. Its decentralized nature makes tampering exceptionally difficult, ensuring heightened levels of security.
Beyond being an accounting trend, blockchain presents a time-saving alternative for auditing processes, delivering heightened accuracy and efficiency while mitigating the risk of human error.
Cloud-Based Solutions are More Common
If you haven’t transitioned to a cloud-based solution yet, 2024 is the year to consider this crucial shift in accounting practices and financial management. Cloud-based accounting software has become a staple trend in the industry, offering accessibility and collaboration advantages that are here to stay. By enabling ready access to financial data from any location, cloud-based systems facilitate real-time collaboration among team members, aiding in efficient decision-making based on accurate data.
Moreover, solution scalability and cost-effectiveness provide a remarkable return on investment. Especially with the increased popularity of remote work, the ability to access cloud-based solutions from anywhere enhances employees’ work flexibility and facilitates partnerships with individuals and companies worldwide.
Cloud-based accounting solutions render traditional systems more accessible and flexible while easily integrating with other software programs.
Greater Concerns over Data Security
Data security remains a major concern in finance and accounting. IBM reported that global data breaches cost an average of $4.45 million in 2023, marking a 15% increase from 2020. As we enter the new year, the industry is expected to implement measures to tighten data security further to combat cyber threats and safeguard sensitive material. Data breaches pose not only privacy and confidentiality concerns but also significant financial risks.
The rising number of people working from home also poses potential threats to data security, but new technologies are increasingly employed to prevent security breaches. As cyber threats evolve, so do technologies to counter them. Staying ahead with innovative cybersecurity measures is essential for financial entities to mitigate risks and bolster defenses against evolving cyber threats, ensuring the safety of financial data.
Encryption, AI, and biometrics are among the newer technologies companies employ to enhance security and confidentiality. Using these technologies together can significantly enhance data safety.
Encryption encodes data for added protection, while AI can more effectively detect and counter cyberattacks due to its ability to swiftly analyze large quantities of data. Biometrics, akin to the technology in smartphones allowing fingerprint or facial recognition, offer enhanced authentication methods. Combining these strategies grants businesses greater control over data access, and this trend is expected to continue in 2024 and beyond.
Continued Use of Outsourcing and Staff Augmentation
Thanks to today’s technology, connecting with people globally has never been easier. Outsourcing isn’t a new trend but has steadily gained traction over the last decade. As we step into the new year, this trend is set to continue as more companies turn to outsourcing agencies to handle key processes or engage in staff augmentation partnerships to fill roles or work on projects.
Attracting the right talent solely from a company’s specific geographic area can be challenging, making partnering with the right agencies vital. These partnerships enable companies to discover highly talented individuals and fill crucial roles without expanding their in-house team size, thereby preventing potential burnout among internal employees.
Many companies may choose to outsource tasks easily automated, such as payroll, financial reporting, and audits, saving money and allowing team members more time to focus on essential tasks and long-term projects.
2024 is poised to bring forth more technologies and strategies. As finance teams are preparing for quarter ends and conclusions to fiscal years, it’s important not to feel overwhelmed by where other businesses may stand in adopting these trends but also not to lag in learning or discussing how to incorporate them if you haven’t already begun.
Finance and accounting leaders are increasingly relied upon for innovative solutions and strategies that enhance returns on every area of business investment."