December 27, 2021 •ROARK
The accounting and finance profession is evolving at a rapid pace, and it's important to stay ahead of the trends that will shape the industry in 2022. In this blog post, we'll outline some of the most important trends to watch for over the next few years. Whether you're an accountant or a business owner, these trends are sure to have an impact on your career or business. So read on to learn more!
Government Stimulus and Changes to Tax Policy due to COVID-19 pandemic
First of all, I believe we can't enter 2022 without acknowledging that 2021 was a year in which we had significant government stimulus and outcomes due to COVID-19. I'm talking about PPP initiatives that didn't exist previously and the EIDL programs, as well as main street lending.
What's changed with tax credits that are intended to stimulate the consequences of those changes in 2021 are still scheduled to occur in 2022. I don't believe we can ignore the impact of these stimulus measures, so I don't think we should discount them.
Machine Learning and Robotic Process Automation (RPA)
We've now covered a lot of automation. We've gone from the spreadsheet all the way through to ERP systems. So we're going to look at what's next in terms of automation and how we're going to do it, which is machine learning and robotic process automation. So that'll take even more routine activities off accounting and finance staff in 2022 and beyond.
So we'll want to be ahead of those curves. And as a result, in 2022, we'll see that continue to grow. Let's go forward and look at the next generation after we've automated some of those more basic jobs; how can we utilize computers to start doing some of the thinking for us so that we may focus on the higher-level activities.
Artificial Intelligence
Artificial intelligence is becoming more popular in a variety of professions. Now, accounting and finance are adopting and utilizing artificial intelligence. We're now at the early stages of that, but we'll advance to using artificial intelligence in 2022.
With all of this data and information from all of these systems, it's more crucial than ever to convert this data into knowledge as quickly as possible, not just information but also things that are actionable, so we can understand the outcomes of our actions and take appropriate actions.
To be able to get even better, stronger, quicker, faster, and more profitable.
Business Intelligence
Business intelligence and software, known as BI, are gaining popularity. And we'll do so in the years to come. They will allow you to take your company or business and focus on what is most critical for the growth of the organization. Business intelligence, for example, would allow you to take all of that data and information and put it into a cohesive and logical format so that you can best understand what is going on with your business or organization.
Remote work and collaboration
We have to be adaptable and creative in this time of rapid change, as the global world is continually shrinking and COVID-19 has pushed us into remote working situations.
In 2022, we can't underestimate the significance of remote work and collaboration in teams. Remote work is not going to go away. Are we going to be completely remote or are we going to combine things?
Being able to work remotely and collaborate, on the other hand, is something that isn't going to go away, and we need to improve at.
Outsourced Accounting
As we face more and more challenges, there are more and more opportunities for businesses to grow and migrate to new accounting standards. Don't underestimate the steam that has been generated as a result of outsourcing accounting.
We now know that you don't have to be an accountant or a finance expert to be a successful member or group member of accounting. As a result, more and more corporations are outsourcing the accounting department, but just the expertise and resources they require in other situations. So, for example, seasonal fluctuations in resources and expertise
Hot Topics in Accounting and Finance
Every profession has its hot topics, and accounting and finance are no exception. Whether you're a seasoned pro or new to the field, it's important to stay up-to-date on the latest trends. Here are three of the most talked-about issues in accounting and finance right now.
LIBOR being replaced
In what seems like forever, prime and LIBOR were the basis that was used in lending agreements. Now LIBOR is going away and it's being replaced by the secured overnight financing rate. Say that 10 times quick. If you can't, then we'll just call it SOFR, for short. On June 30th, 2023, that will be in place.
We've already started phasing that out in 2021. So expect that phase out to continue. And you're going to want to look at your lending agreements to see how that impacts your business.
Automating ASC 606
Everyone should be using ASC 606 or the new revenue recognition rules by 2020. But now what we'll do is take all of our knowledge and learn to automate it so that we can apply it better and better.
ASC 842 - New leasing standards
ASC 842, which is the new leasing standard that replaces our FAS13 or FASBI 13, which denote capital versus operating leases. What we're now doing is we're looking at long-term non-cancelable leases as obligations on the financial statements. That's going to potentially change leasing requirements. It's going to change terms and we're going to have to make sure that we're assuring compliance. You may want to look at, depending on your industry, software to be able to help support those initiatives. Kind of like what we have with stock options and other new accounting systems that have come into place for accounting and finance.
Wrapping up the 2022 Trends in Accounting and Finance
So I'm aware that we've discussed trends such as technological advances, business modifications, and accounting and finance changes.
So that's the top trends in Accounting and Finance for 2022, in a nutshell.
Here's to an amazing 2022 in accounting and finance.