Published On: Wed, Jan 2nd, 2019

3 Small and Medium-Sized Business Accounting Trends for 2019

 

As businesses begin their journey into the 2019 business year, attitudes are already starting to shift towards technology and automation more so than the year previously.

 

Bookkeepers and accountants are leading the march towards embracing such technology more than ever before.

 

Leaders in the bookkeeping and accounting sectors are using technology to unlock time-saving methods of doing their job so that they can do more both in their business and personal life.

 

The global statistics reflect where things are headed. According to technology experts, the global accounting software market is expected to reach close to $12 billion by 2026.

 

Additionally, the number of subscribers continues to grow, with the amount of Xero users having increased 24 per cent over the past year.

 

Companies such as QuickBooks Online have also seen subscribers grow by 41 per cent, and MYOB is expecting to have over a million subscribed users by 2020.

 

Sage Group, the British multinational enterprise software company, is doubling down on its product Sage Business Cloud.

1. The EU’s “Open Banking” Unleashes the Power of Bank Data

Last year, the Australian Competition and Consumer Commission (ACCC) proposed that Australia’s big four banks – Westpac, NAB, ANZ, and the Commonwealth Bank of Australia (CBA) – will be the first Australian banks initially subject to the EU’s new Open Banking regulation.

 

Open Banking is a subset of the Consumer Data Right (CDR), which has yet to finish being legislated.

 

The Open Banking rule gives consumers living in the UK, Australia, and the rest of Europe the right to request that their banks disclose data of their use of the banks’ services to a third party via application programming interfaces (APIs).

 

Naturally, software companies like Sage, MYOB, Xero, and QuickBooks Online have since expanded their services to include banking features.

 

Those who are in the business of bookkeeping or accounting should learn about these new changes and how the Open Banking rule will affect their work. Furthermore, additional MYOB training may be required.

2. More Focus on Cash-Flow Consulting

“Australia is a nation of small business,” according to the Australian Small Business and Family Enterprise Ombudsman. Further, over 90 per cent of Australian businesses are small businesses with less than 20 employees.

 

Small businesses comprise 33 per cent of Australia’s GDP and pay over 12 percent of the government’s overall tax revenue.

 

The deciding factor of whether a small business lives or dies is the amount of cash flow it has.

 

Not being able to create and maintain an accurate forecast of its future cash flow means businesses cannot draw up long-term goals.

 

Some of these long-term goals include making critical investments, employing additional staff to support expansion, among other things.

 

With Australia leading in the number of SME late payments globally, with the average invoice fulfilled 26 days late.

 

In addition to that, according to Prushka Fast Debt Recovery, almost 60 per cent of Australia SMEs had roughly $10,000 in outstanding debt per month – and that’s when things are going well for the economy.  

 

However, teams of cash-flow Fintech companies have appeared on the scene offering cash-flow management solutions — their mission: helping SMEs succeed.

 

Small to medium-sized businesses will find it much easier to manage their cash flow in 2019 and beyond.

3. The Importance of Compliance Will Be Ever Crucial

SMEs saw a revival in the importance of compliance in 2018.

 

Advisory services have been popping up all over the Internet in the last few years, with automation handling more and more tasks that involve keeping businesses compliant.

 

Ironically, all of these technological changes are what is bringing compliance back to fore, since an increasing number of SMEs expect their advisors to help them remain on top of things in the digital age.

 

All over the world, compliance is not so much of a black-and-white must have as it is a powerful commercial tool.

Today, a little over half of Australian SMEs are using some dashboard or another for monitoring compliance-related matters.

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