Financial Advising: Accounting's New Look
Contributed by Brooke Faulkner
13 April, 2018
Number crunching and accounting is becoming an activity that individuals and business owners are increasingly able to perform themselves. It's becoming easier to report and file taxes, to track expenses, and to plan the use of income.
Why is that?
Technology is the main source of upset in the accounting space.
Programs like TurboTax and other forms of accounting software are making it very easy for the layman to perform work that would normally need to be done by professionals. Tax and even audit technology are forcing accountants to innovate in order to keep clients coming back and to better serve them. Small business owners are rapidly adopting cloud based accounting software, and so the regular responsibilities of accountants are being encroached upon quickly by technology.
What's The Good News For Accountants?
The news isn't all terrible, and there is good news to balance it out.
As all accountants are well aware, the tax code in the US is far too complicated for every person and business to be served well by automated software. Some tax situations are just too complex. On top of that, there are a number of people far more confident in going to a professional person than trusting software, however advanced, to handle taxes.
One way to adjust to a new climate in accounting is to focus on what additional benefits you give someone as an accountant. For example, you can focus on the idea that an automated system may not be able to prevent tax wastage the way that you can, highlighting your ability to protect clients from overpayment. Especially when people and businesses deal with international revenue and offshore bank accounts, the need for a personal revue of the books remains great.
Are There Other Ways to Make Up For Lost Business?
The biggest change an accountant can make is to create additional value propositions for customers. This might require training in new skills or getting new certifications, but it might be time to delve into the realm of financial advice.
Accounting and finance are different qualifications, but there is a great deal of overlap. Money sense is money sense, and you likely already have the knowhow to offer practical advice to people looking for peace of mind.
Recently, governments have been cracking down on tax avoidance and evasion, and the professionals who enable them. Navigating new legislation can be extremely complicated, especially for those who have enjoyed the benefits of loopholes in the past that are being closed. Many individuals or businesses are coming forward to declare their offshore untaxed assets to avoid being prosecuted for being involved with a tax scam, and will need representation for that process. So "tax advice" is still a lucrative area of business, especially when it comes to individuals and businesses who struggle with owing tax at the end of the year.
Career moves are one potential solution for the average freelance accountant. Big businesses still need in-house accounting teams. But for those who enjoy working for themselves too much to make that leap, financial advice could be the next step.
Selling investment products isn't going to work on its own, however, as that particular service is also being inundated with technological advancements, apps and websites that are user-friendly and automated.
Solid advice, however, is something machines can't quite do yet. Even when machine learning gets good enough to give customized financial advice, there's definitely a question as to whether people will trust it.
When an industry is being invaded by automation, it's important to look for the things that machines can't provide, or for services that people don't want them to provide. Minds are still set at ease by sitting down and talking with an advisor who is genuinely interested in the financial well-being of their clients. It's a feeling that isn't easy to beat. The financial industry can definitely survive automated cloud services, and a renewed commitment to ethics, customer service, and personal innovation is how to get there.
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