Digital evolution, new innovations and the advent of new technologies globally and by implication Nigeria have changed the course and direction of accounting and accounting information systems. Change, therefore, becomes the new constant. As change becomes a necessity for growth and innovations, organizations that continue to reshape their business processes and business model need to also be aware of the emerging issues in accounting for 2022 and beyond.
Over the years it has been the practice of developing economies to use old and primitive practices and strategies to manage the affairs of the economy. This method has been characterized with longer hours of man work, low productivity and output. It was taking longer hours to accomplish a task that should be done in minutes if executed electronically. Unfortunately, the private sector which is most populated by small and medium scale businesses of which this study focuses on, and that should have been the pillars pushing towards digitalization of financial records have been smeared with bad government policy formation, poor and inadequate funding, inability to access funds to expands business capacity and worst of all inadequate working professionals to meet the demand for digitalization.
Technology has many stories to tell. The word itself is synonymous with development and, in much of today’s business landscape, it continues to reshape industries and businesses, even in the trying times brought about by the COVID-19 health crisis. It transforms systems and processes, converting manual tasks into automated functions. With technology, businesses operate more efficiently and effectively. And this is where the latest accounting trends mainly revolve around.
Accounting is an important element of the business process since a well-run accounting information system can provide timely, accurate and relevant information for management decision making.
Here is a List of 10 Top Emerging Issues In Accounting for 2022
Please find below some of the emerging issues in accounting for 2022.
- Automation and Digitization of Accounting Function
- Rise of Accounting Software Solutions and Implementation
- Cloud-based Accounting Solutions
- Outsourcing Accounting Functions
- Integration of Accounting with Operations
- Transparency and Objectivity
- Data Analysis
- Social Media Integration
- Emerging Remote and Mobile Accountants
- Changes in Accounting Standards
- Big Data in Accounting
- Proactivity is the New Normal in Accounting
1. Emerging Issues In Accounting for 2022: Automation and Digitization of Accounting Function
Automation and digitization of accounting function is a major, if not the most important emerging issue in accounting for 2022 and this is fueled by the development of effective and efficient accounting software advancement.
Accounting can now be highly automated without the need for significant physical intervention. Latest accounting software has enabled organizations to minimize data entry and the need for physical hardware documentation. Most documentation and data are now hosted in an integrated accounting server, leading to efficient utilization of capital and better management of resources.
2. Emerging Issues In Accounting for 2022: Rise of Accounting Software Solutions and Implementation
The adoption of technologically-driven accounting software as given above will intensify in 2022. As the demand for automated accounting grows particularly during the pandemic, accounting software companies will address this need with robust solutions. These software platforms possess a range of software functionalities accountants value the most, such as optimizing processes and minimizing manual tasks.
The accounting software market will experience a higher level of growth in 2022, according to a report by Fortune Business Insights. All over the world, there is a strong demand for software platforms to manage daily finnacial data and have a better understanding of tax management.
List of Most Popular Accounting Software in Nigeria As Emerging Issues In Accounting for 2022
Sage 50 Accounting Software
FreshBooks Accounting Software
QuickBooks Accounting Software
SAP Accounting Software
Xero Accounting Software
Zoho Books Accounting Software
AccountEdge Pro Accounting Software
Wave Accounting Software
ZipBooks Accounting Software
Sage Business Cloud Accounting Software
Tally Accounting Software
Busy Accounting Software
Godaddy Accounting Software
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3. Cloud-based Accounting Solutions
Cloud-based technology is one of the leading emerging issues in accounting for 2022 and will gain even stronger momentum around the business world in 2022. The concept of using shared resources, including accounting software that runs on the providers’ servers and being able to access financial information in the cloud, has made accounting information more accessible and the process more efficient.
4. Outsourcing Accounting Functions
For businesses, outsourcing accounting functions can allow them to focus on their core business and better utilize their resources. This is an emerging issue in the profession and such a drift is not limited to small and medium-sized entities, SMEs; even as big companies are outsourcing their accounting and processing functions to competent accounting consultants for efficiency and effectiveness.
Another related emerging issue in 2022 is to outsource the entire accounting function to a third-party financial consultant or retainer, and they provide end to end support of the accounting function, including a customized accounting software solution and corporate controller-level resources. Outsourcing gives companies access to experienced and qualified accountants and ensures the quality of service that is scalable and consistent.
5. Integration of Accounting with Operations
With the implementation of effective and efficient accounting software, one of the continuing emerging issues in accounting for 2022 is to integrate accounting function with all segments and departments of the entire business operation. This gives better management of transactions and timely recording of entries. For example, the accounting function can be regularly updated in real time by the sales department as sales occur.
Also the purchases and procurement department can be saddled with real time posting of purchase invoices and inventory items in the store to be immediately entered in the inventory ledger. The integration saves time by automating routine activities and reduces the operational activities of the accountant with a focus on more strategic finance role.
6. Transparency and Objectivity
Transparency and objectivity as a major emerging issue in accounting have never been more important. Accounting governing bodies, such as ICAN, CITN and ANAN, have placed significant emphasis on this area. In the wake of many recent accounting irregularities and scandals, restoring trust and credibility of the accounting profession is essential.
This is even made easier and veritable by the use of accounting software in organizations which in turn reduces frauds and erros and facilitates accuracy and reliability of date.
7. Emerging Issues In Accounting: Data Analysis
Information is the key to making not just sound financial decisions but also key management strategic operational decisions. Advancements in data centers, database techniques, and accounting software are emerging issues in accounting for 2022 that has made these functions easier and ushered in the age of big data and mining of data to aid management decisions.
Information generated by accounting has always been a crucial component of business decision-making. Focus on data analysis of the underlying accounting and financial information is becoming one of the key emerging issues in accounting for 2022.
8. Social Media Integration
Social media is becoming more popular these days and with this, accounting professionals can now use social media interaction to communicate with their peers and colleagues to updates on latest business, political, and accounting developments that may impact their work. This is an equally one of the top emerging issues in accounting for 2022.
9. Emerging Issues In Accounting: Emerging Remote and Mobile Accountants
With the emergence of cloud computing, and prevalence and acceptability of accounting software which enambles electronic documentation in place of traditional paper-based vouchers, invoices or receipts, accountants are now increasingly more mobile. Accountants can work remotely and there are currently many team sharing tools to enhance remote collaboration and work.
10. Changes in Accounting Standards
Accounting standards are continually being revised and updated to keep up with the times. Many of the standards that were developed before the advent of social media, ad-tech (digital advertising) “shared” economy (shared rides, lodging etc.). These new business models have a significant impact on accounting. Accounting professionals need to keep up with changes that are happening at a much faster pace than before. This trend will continue in 2022 and beyond.
11. Big Data in Accounting
Just as big data plays a crucial role across many sectors, it fills the same significant role in the accounting industry. Big data supports companies and firms through expanded assessment methods, with accountants and finance experts working behind the scenes. Professionals identify which of the collected data are the most valuable and then turn them into actionable insights. This makes it crucial to understand what big data is in making business decisions.
With the use of big data, accountants and experts transform key internal data sets into secure, vigorous, and important data analyses. Globally, 63% of organizations are also looking to adopt big data in the next few years (Dresner, 2020). Meanwhile, a growing number of firms are now prioritizing accountants who have extensive knowledge in analytics and data science. This shows that the accounting industry is shifting from its reactive nature to becoming more proactive. CPAs, backed by big data, can now focus more on planning, taking control, analyzing processes, and anticipating problems before they even happen.
12. Proactivity is the New Normal in Accounting
Accounting function generally used to be reactive in nature, e.g., it records and accounts for transactions that are past. This is changing now due to many factors, such as evolving business models, regulations, increasing role of accounting in making business decisions.
In 2022, the shift is for the accounting function to take a more proactive role in understanding the potential implications of any significant business initiative, including tax impact. This allows businesses to run efficiently, without having to spend significant resources to undo accounting errors or to understand and account for new business initiatives.
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