It’s no doubt that Blockchain is spreading its influence into every sector of the economy, such as insurance, education, investing, government real estate, banking, etc.
Almost every company all over the board are incorporating Blockchain into every of their company’s processes. Blockchain is also widely known for controlling crypto, and the technology has a wide range of applications.
Blockchain provides a new and incorruptible method to share, store, and record any data.
Benefits of Blockchain on the Accounting Industry
1. Reduced Fraud
Blockchain can be influenced to enhance traditional accountancy and contend accounting fraud. It’s complicated to commit fraud using Blockchain due to its unchangeable nature.
Altering a record on a blockchain is not feasible as the actor would have to simultaneously make the same modification on all the copies of the dispensed ledger.
2. Reduced Auditing
Lots of accountants are enthusiastic about Blockchain because it leads to lesser audits in the future. Auditors can automate almost all the auditing functions through the power of the keen contracts.
Auditing is now faster and more comfortable. All thanks to the inbuilt traceability of everything that is recorded on the Blockchain.
For the fact that everything is automatic, Blockchain can decrease the time the auditor needs to spend on going through “the books.”
3. Improved Regulatory Compliance
Every agency must pass through lots to things to the demands of satisfying regulations. Blockchain can assist in taking the responsibility off. All thanks to the enhanced security it provides. Blockchain may even become compulsory in some financial sectors since lots of regulatory authorities are already accepting the technology.
4. Easier Reconciliation
The end-of-month tasks will become less of a burden. Only if accountants can start making use of smart contracts to automate every of their reconciliation tasks.
5. Reduced Errors
When it comes to entry of data, that is perhaps the area where Blockchain can assist accountants the most. It’s where the possibility of human error is highest. Blockchain can significantly decrease human error by making every of the accounting functions automatic.
6. Improved Efficiency
Blockchain can be developed or designed to be much more useful than the legacy accounting software. It’s more challenging to get data in and out of the accounting software. Blockchain has a much faster and more extensive database.
7. Reduced Cost
Regardless of the type of system, a decrease in errors and an increment in efficiency will result in reduced costs. When changing from the conventional accounting systems to the Blockchain, accounting firms can expect to see cost savings faster.
Two Factors Stopping the Mass Adoption of Blockchain in Accounting
The blockchain technology provides lots of promises, but integrating your business with Blockchain is not an easy task. It is as a result of two factors stopping the mass adoption of Blockchain in accounting, and they include:
1. When it comes to the non-technical aspect, the primary thing that stops Blockchain from reaching out freely to the accounting industry is the sluggish nature of the industry that will wait for a long while to accept the DLT technology.
Although, the accounting industry can’t be entirely blamed for this because the enterprise-ready blockchain solutions for the accounting sector are not yet readily obtainable. But within a short time, this excuse will soon be over as innovators and investors are keen on satisfying this emerging market.
2. When it to the technical aspect, you will display that most of the accounting software is not fully compatible with blockchain technology presently.
Even though you’ve decided to integrate your accounting firm on the Blockchain, your existing software may not be friendly. Adoption requires the purchase of cloud-based accounting services as they become available, and possibly hiring a professional blockchain developer to develop custom user interfaces for your firm.
But as more and more accounting firms that will still want to adopt the blockchain technology, many cost-effective solutions may start to occur soon.
Are the Accountants at the risk of losing their jobs?
Lots of people are concerned and scared about their jobs whenever they aware of a new, innovative piece of technology in their sector. Though in some industries, there has indeed been some cause for them to be worried.
For example, few investment brokers have been losing clients since individual customers can access the data they needed to invest on their own.
The accountancy firms and accountants will be able to offer their customers and their employers the maximum security and safety of all records in their care.
Before information is being entered into the Blockchain, companies will still need the services of professional accountants to interpret and categorize that information. Accountants will be the ones to bring about and control the new system. So, it’s certain that most accountants won’t lose their jobs.
Blockchain makes things easier, better, and faster, but it still needs some human effort. Someone must enter the payments, orders, and contracts into the Blockchain. Blockchain will offer transparency, effectiveness, and record permanency of all data.
How Should Accounting Industry Prepare Itself
The fact that the blockchain technology will soon make its grand entrance to the accounting sector doesn’t require any fear — accounting firms have plenty of time to prepare for adoption, just not much time to waste.
The accounting sector can prepare itself by firstly, creating an awareness of what Blockchain entails and being updated about how the technology is evolving.
The accounting industry must be prepared to work with providers on how they may use their accounting services. Early consultations with professional blockchain developers can grease the wheels for easy and early adoption, giving accounting firms a competitive edge in this emerging but promising market.
As blockchain development take over the accounting industry, regulators, technology providers, and accounting industry leaders must work in harmony and enquire for ways to make the transition beneficial for everyone.
Should Accountants and Auditors be Excited or Concerned?
The answer to this question eventually comes down to how well-prepared you are to accept the blockchain technology for your accounting industry.
Blockchain will transform the way accountants do their things. Accounting won’t become unimportant; it will become better and effective. Just like the same way computers and the internet have transformed workplaces across all sectors, Blockchain will offer great solutions to industry-wide problems.
Most businesses are presently reconsidering their business models and assessing the need to bring about a blockchain solution. Nevertheless, it’s essential to keep in mind that problems should not be created or developed to implement Blockchain.