Informed by research from BILL’s 2023 Accounting Firm Automation Opportunity report
In the dynamic landscape of the accounting profession, some may not fully understand the expanse of benefits that comes with accounting automation. Automation is often associated with growth because it promotes greater efficiency and enables employees to maximize their time. However, the advantages of automation extend well beyond efficiency gains.
Accounting firm automation breathes life into innovation, strategic thinking, and the ability to scale. These benefits become even more clear when you look at the research.
As part of BILL’s 2023 Accounting Firm Automation Opportunity report, more than 1,000 accounting professionals weighed in on the advantages of automation in accounting.
Key takeaways include:
- 89% of accounting professionals said that automation in financial operations makes their firm more profitable and efficient.
- 85% of survey participants offering client advisory services (CAS) said that automation improves the quality of data.
- 57% agreed that financial operations automation helps them attract talent.
Now, let's dive deeper into what automation is, its most significant advantages for accounting firms, and data from the report that highlight automation opportunities.
What is automation in accounting?
Automation in accounting refers to using technology and software to streamline and optimize various financial and accounting tasks, processes, and workflows within an organization. This can involve automating tasks such as manual data entry, invoice processing, expense tracking, payroll calculations, financial reporting, and more.
Ultimately, accounting automation supports a firm’s capacity to scale. By simplifying operations, accounting firms are better prepared to handle more complexity and a greater volume of work—and often without adding headcount.
89% of accounting professionals said that automation in financial operations makes their firm more profitable and efficient.*
Challenges of manual accounting
In the rapidly evolving landscape of financial management, the persistence of manual accounting methods presents several daunting challenges and inefficiencies. Here are some of the biggest:
Human error
Manual data entry is susceptible to human error, whether it's a simple keystroke mistake or a misinterpretation of financial data. These errors can have significant consequences––from inaccurate financial reporting to compliance issues.
Inefficiency
The sheer volume of paperwork involved in manual accounting can be overwhelming. From recording transactions to reconciling accounts, these tasks are time-consuming and labor-intensive, diverting valuable resources away from more strategic activities.
Limited accessibility
Traditional accounting methods restrict accessibility to financial data. Tracking down specific records or transactions can be time-consuming and frustrating, especially when multiple people need access to the same information.
Lack of real-time insights
Manual processes often result in delayed financial reporting. Firms need up-to-the-minute insights to support their clients and manual accounting struggles to provide this level of visibility.
Security risks
Physical documents are vulnerable to loss, theft, or damage. This poses a significant security risk, especially when handling sensitive financial information.
Scalability issues
Manual accounting processes become increasingly cumbersome as businesses grow. Expanding operations mean more transactions, more paperwork, and more room for error.
The top 5 benefits of accounting automation
Beyond scaling, reducing human error, and enhancing data accuracy, automation keeps firms more competitive and can help attract talent. By automating repetitive tasks, your accounting firm can save time and resources while helping clients make informed, data-driven decisions via real-time visibility into their financial data.
With that in mind, here's a closer look at 5 benefits of accounting automation that extend beyond just growth.
1. Enhance operations firm-wide
One of the most immediate benefits of automation is streamlined accounting operations. Here's what you can expect.
Elevated efficiency in accounting workflows
Automation helps you standardize workflows for your firm and with clients. This allows you to develop uniform practices, instead of creating new processes for each client.
For instance, it allows you to deliver AP and spend management services on an integrated platform consistently and more efficiently. This yields time savings for employees while also ensuring the quality of service delivery.
In the 2023 report,
77% of participants believe that consolidating AP, expense management, and AR into one automated platform will benefit their firms.
According to survey participants, the top three benefits of this consolidation include saving time, closing the books faster, and putting client data in one place. All three of these answers provide benefits for firms and clients.
Reduce manual errors and bottlenecks
The risk of error is always present when work is manually driven. Correcting errors takes time, creates bottlenecks, and obscures cash flow insights.
Automation helps reduce these challenges. In fact, 85% of survey participants offering CAS said that automation improves the quality of data.
The best automation software dramatically reduces human error for accounting firms by auto-populating data from relevant documents. For example, BILL's Intelligent Virtual Assistant (IVA) uses machine learning to extract invoice and vendor information from documents for up to 50 pages in your Inbox or those attached to a bill.
Save time on accounting tasks and cut costs
When asked, 90% of survey participants new to automation agreed that it saves them a significant amount of time.* This seems to indicate that it doesn’t take long to realize automation results.
Consider the time you're currently investing in repetitive tasks, such as manually coding expenses. Modern spend and expense solutions leverage automation to code expenses and collect documentation before they cross your desk–all while ensuring your clients spend within budget. With advantages like this, financial operations automation allows you to spend more time on higher-value, year-round advisory work that builds positive, long-lasting client relationships.
Additionally, 61% of firms offering AP and expense management services agreed that automation enables them to provide services they could not offer otherwise.
2. Enhance accuracy
How confident are you in the accuracy of your current accounting processes at your firm? The fact is that automation improves accuracy and efficiency—and this all leads to a more effective and rich client experience (not to mention happier staff).
Internal controls support accuracy
Using accounting automation software further protects your firm by supporting internal controls. This enables you to assign specific roles and permissions for accounting team members and clients—supporting separation of duties and proper checks and balances.
Take client bill pay services as an example: one person enters transactions, another approves, and a third initiates payment. Separation of duties minimizes the risk of unauthorized actions, enhancing the integrity of operations. If needed, firms can also use the view-only role to enable auditors and other authorized users to view client information without the ability to change it.
Accounting automation software also provides a clear audit trail of activity for full visibility into workflows. Every action is documented, including who performed it, when it occurred, what changes were made, and payment information. This enhances transparency and accountability across the board within firms.
For example, BILL Divvy Corporate Cards can be deactivated quickly if suspicious activity is detected, and you can easily issue and monitor virtual cards for each different software subscription or advertising spend to add layers of security for clients. Because cards only work if they've been sent approved funds, your clients can prevent unauthorized purchases and access to funds in other budgets.
3. Increase client satisfaction
Automation isn't just good for your firm; it also enhances the client experience overall. Standardizing your processes and service offerings can ensure consistency and enhance your reputation as a tech-savvy provider.
Provide faster response times
Automated technology can make your clients' lives easier by keeping them informed in real time. You can use automated tools to provide transparency into data and 24/7 access through a mobile app. As a result, your clients stay informed regarding how much they're spending or where a bill is in the payment process.
This level of speed and detail helps your firm solidify relationships with existing clientele. It can also help you quickly build trust with new clients who value visibility into processes and data.
Improve service quality
Client advisory services are built on trust and expertise. Automation allows you to nurture CAS relationships by leveraging the right tools and satisfying the on-demand needs of small to midsize businesses.
In another recent survey conducted by CPA.com—From Expense Tracking to Spend Management: The Next CAS Opportunity for Accounting Firms—nearly 72% of small to mid-size businesses say they’re looking for a proactive approach to expense management. You can expand your services to meet this rising demand by adopting automation.
Automated tools allow you to expand services, whereas relying solely on manual processes for services like accounts payable or spend and expense management ties up resources. Pivoting to an automated solution creates new opportunities—like CAS—to meet your clients' business challenges and fortify your revenue streams.
4. Empower your employees
Automation can help you develop strategies to retain top talent and keep them engaged.
Focus on higher-value work
Automation saves valuable time that you can reallocate to higher-value assignments, and this can have a positive trickle-up effect across your team. Higher-value work like client advisory services allows staff to build deeper relationships with clients and feel more engaged in their work.
This is an important advantage, especially when 51% of firms reported that they plan to grow their client base by adding new services.* The bottom line: firms that lag on automation adoption may face disadvantages when looking to add services like CAS. This disadvantage becomes more clear when you also consider the double-digit trend in growth for CAS practices since 2018.
Foster skill development and job satisfaction
By adopting automation, your accounting firm can explore diversifying service offerings. For example, some firms may shift their focus to things like advisory work, technology implementation, or other specialized fields.
Building in-house expertise in automation will further benefit your firm. Many technology providers offer certification programs and educational opportunities to further develop skills.
5. Improve scalability and adaptability
Finally, automated systems allow you to make the most of what you have—helping you develop a manageable, successful strategy for growth. This is key when you consider the staffing shortage challenges in the accounting profession.
To combat issues like a shrinking candidate pool, automation is an important part of the formula to attract new, qualified employees. The 2023 Accounting Firm Automation Opportunity Report indicated that 57% said that automation helps them attract talent—with that percentage rising to almost 70% for firms with 51+ employees.
Gain flexibility and enhance your ability to handle an increased workload without adding resources
Think of the time you can save with an integrated accounting automation platform. Time that you can then reinvest in expanding services. You can also use this time to take on new clients without overloading and burning out your current workforce.
Either way, you're more equipped to complete more work without significantly increasing headcount and other resources. An investment in automated tools can pay big dividends in expanding bandwidth across your firm.
Accounting automation example
Chaney & Associates exemplifies the automation success story, relying on BILL to help power continuous closes and shift staff to more high-value contributions.
Before spend and expense automation, each of their client’s employees had a preferred card and expense management system. As Steve Chaney, Managing Partner of Chaney & Associates, describes it, “There were too many cards and expense management systems. Everyone had a card and wanted to be reimbursed. It was impossible to grow.” It would also take the Chaney team up to 10 hours a month to manage expenses for one small client.
Chaney & Associates adopted BILL Spend & Expense in 2019. Now, after a new client signs up for it, by request of the firm they also implement BILL for finance automation and Xero as their accounting software. All three platforms seamlessly sync to streamline spend from payments to expenses and beyond.
Summarizes Chaney, “All of our systems are connected now. And it’s all automated. We love that.”
As a result of BILL and automation:
- Chaney & Associates closes the books with their clients every week, avoiding the stress that arises from the more common practice of closing the books at the end of the month.
- They've increased capacity. According to Chaney: “With Spend & Expense, our staff of 17 can easily serve 2,500 people. We can serve more clients in less time—focusing on other high-value client services beyond expense management. Serving more clients has enabled us to experience a spike in income.”
Read the entire customer story here
What to look for in an accounting automation software for firms?
When selecting accounting automation software for your firm, making a well-informed decision that aligns with your business needs and goals is essential. Here are key things to look for:
1. Tools to support client management
Look for ways to simplify workflows and discover new opportunities to serve your clients better. For example, the BILL Accountant Console helps you save time and better prioritize your day by quickly viewing tasks across clients. You can also eliminate manual reporting and increase data accuracy through AI-powered reports like Processed Bills or Bill Reminders.
2. Integrated, automated, and customizable workflows
Make sure your software enables your accounting firm to manage multiple workflows––like accounts payable, accounts receivable, spend, and expense––all in one place. Look for features like automated data entry, transaction categorization, and fast reconciliation capabilities to streamline your firm's financial processes.
3. Cloud access
Opt for a cloud-based accounting solution for more flexibility and accessibility. The cloud allows your firm to work from anywhere, collaborate in real-time, and securely store financial data in the cloud, reducing the risk of data loss.
4. Custom user roles
Make sure your software supports users with customizable access permissions. This feature is crucial for a firm’s team members collaborating internally and with clients allowing them to work on financial data simultaneously while maintaining data security.
5. Robust resources to accelerate your growth
Consider the scalability of the accounting software to accommodate your firm's growth. Having a dedicated account manager, perks for you and your clients, and access to accredited CPE content can all help you achieve your goals faster.
What can accounting automation do for your firm?
So, what can automation do for your accounting firm? Short answer: A lot. The right automated accounting system can improve the accuracy and efficiency of your core processes and give you the flexibility to adapt to changing client and staff needs.
Now is the time to start exploring accounting process automation. Every day not spent operating at peak efficiency is a day you're losing to competitors who are already leveraging the full power of automation. Take advantage of the opportunities that automation offers—including improving efficiency, visibility, and scalability while gaining more control over broad firm operations.
Learn more about financial operations automation and the opportunities it presents to accounting firms by reading the report. See how you and your can manage AP, AR, spend, and expense in one place and easily sync this data with your accounting software for a faster month-end close.