Beyond Bookkeeping

What is the future of bookkeeping and how bookkeeping trends will shape your business future?

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Whether they are using bookkeeping services or in-house employees, owners look for more that just compliance bookkeeping today. At a recent Xero Bookkeeping conference, they suggested Code Free Bookkeeping is on the horizon. Transactions will flow seamlessly from Apps and Banks into feeds and be automatically posted correctly. Reconciliations will also be done automatically. The power of AI. To be clear we are not there yet, but this is not a distant future prediction. Its day will come sooner rather than later. 

So what does this mean for bookkeeping and bookkeeping services?

Bookkeeping will be, if not already, more than just keeping books. Current data management will move toward Code Free Bookkeeping. The role of the bookkeeping is moving away from compliance to Advisory. We will no longer be obsessed with historical results but look to the future. Where is the company going? How can the company grow? The achievement of company goals. There is a movement away from the discussion of historical data to a look at future projections with the caveat that these future projections are compared to actual results in future quarters. We can clearly know how the company has done but the win is knowing what to expect in the future. This is what is found beyond traditional bookkeeping and bookkeeping services. Educated insights into where the business is heading.

What do owners want to know from their bookkeepers or bookkeeping services?

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They need to know current actual results, but this is history. Really they need to know what to expect in the future. Sales projections, expense projections and a cash flow projection. What are the hurdles and potential troubles coming their way – along with the wins? Be prepared for what cash flow has in store. No surprises. Be proactive on securing funding. This will allow a business to thrive. These are the ingredients for future growth.

Apps used for projections in a financial management meeting are DryRun for Cashflow, Futurli for projections, Budgets in Quickbooks Online and Xero and Fathom for business intelligence.  These apps move bookkeeping beyond historical compliance to future projections of where the company is heading. What can we expect? What do we need to prepare for? This takes place with a discussion with the business owner that is often more about asking the right questions than telling someone what to do. The owner knows his or her business best. The accountants/bookkeeper’s value is not in historical compliance but uncovering where the business is headed in the future. What is needed to grow the business – and achieve the goals of the owners.

It is high value to predict the obstacles the company will run into. This requires education and experience on the part of the bookkeeper. A bookkeeper needs to rise to the challenge of Advisory. So be selective in the bookkeeper or bookkeeping service you work with. Advisory is a skillset beyond traditional compliance. The truth is found in the results of an Advisory engagement after 3 or 6 months. Results are measureable. Work with projections to guide you but the execution is measured in actual results at some point.

In summary AI will create Code Free Bookkeeping in the not so distant future. But even today bookkeepers are moving beyond compliance to Advisory work. Historical actuals are important but projections lead a company into the future and prepare for obstacles. The future is achievement of company goals. Advisory helps a company get there. But it is still about execution. Advisory ‘s projections are measured against actual results at some point in the future. Both bookkeepers and accountants need to rise to the challenge of Advisory to provide the highest value to their clients.

By |2019-09-23T20:27:04+00:00April 10th, 2019|Finance|