Progress of Technology in Accounting

Every accountant knows that accounting and bookkeeping are the pillars of any business. Accounting gives a business direction in identifying essential requirements to keep a business running. Therefore, it has always been an important domain, where continuous up-gradation takes place.

Accounting has gone through many changes in the past few decades. But even with all the alterations taking place the primary aim of accounting technology has always been: making the accountant’s job just a little easier.

Let us look at how Accounting has always embraced technological changes:

● The Abacus: We can trace back the history of technology in accounting with the development of the math device called Abacus, which was used to monitor estimations in business. Even though it cannot be counted as technology, we can see that a lot of innovation took place in the endeavor to construct tools to assist a bookkeeper with mathematical arrangements.

● Calculators: Thereafter, calculators were introduced for data precision and as technology advanced so did the speed and capability of a bookkeeper’s job. In any case, even with calculators and other tools the bookkeeper still needed to monitor the organizations’ financial capacities with paper entries. Financial information was in the form of paper records, number columns and handwritten statements. An accountant must be an exceptionally precise, conscientious individual.

● Computers and Accounting Software: By the end of the twentieth century the accounting profession took a whole new shape. Computers and accounting software programs had changed the scenario completely. The introduction of programs like Microsoft Excel brought a revolution to the accounting domain. Ledger books, calculators and paper-pens were diminishing. An accountant’s job became more interesting with a lesser margin for errors. With the use of the computer, an accountant could now perform statistical accounting or forecasting analysis with greater efficiency.

● Internet: Another important technology that has played a vital role in making an accountant’s job easier is the Internet. Unsurprisingly, the internet allows an accounting business to conduct E-business. Coordinating and sharing information with several stakeholders has become a cakewalk with the use of digital networks and email. Electronic communication not only increases efficiency but also cuts down on travel costs ultimately reducing operational costs.

● Cloud Accounting Software: This was followed by the now popular service called Cloud Computing. This service is provided over the internet, which allows an organization to permanently store data and use enterprise applications over a remote server.

Huge amounts of data are stored in perpetuity at centers shared by many other users. The advantage of this is that it frees up space on the firm’s hard drive and the firm easily rents space from giant computer centers.

The only thing that an accountant should keep in mind when deciding to use this technology is the security issues involved. But there is a solution to this as well. Just as accountants are obliged to understand the risks of this technology, Cloud service providers are obliged to provide a safe environment to store the organizations’ sensitive information.

The other benefits of using Cloud accounting software is that an organization can synchronize files across different platforms, back-up all data, analyze data in real-time and generate reports conveniently.

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