It might not seem like it at first, but there are some big differences between accounting and finance roles. Accounting and financial advisory are broad business functions that revolve around multiple job opportunities and roles within organisations. What’s more, accounting related roles are continuously evolving with the adoption of cloud accounting and business automation platforms – technology is rapidly transforming accounting and financial advisory, resulting in the creation of new roles in modern companies e.g. accounting technologists.
Even though some of these functions sound similar, there are clear differences in the application of accounting knowledge and expertise. Here’s how to tell the difference between accountants, bookkeepers, financial advisors and accounting technologists.
What do accountants and accounting technologists take care of exactly?
Typically, accountants are involved in interpreting financial records and providing tax advice. “Accountant” and “bookkeeper” might sometimes be used interchangeably, but there’s a big difference: bookkeepers focus on recording financial transactions, whilst accountants specialise in drawing conclusions from financial information rather than just collecting it.
The exact tasks and responsibilities will vary depending on the business, but some of the most common ones include ensuring the accuracy of financial documents (as well as their compliance with relevant laws and regulations), preparing reports and tax returns, evaluating financial operations to identify issues and recommend solutions, as well as offering guidance on cost reduction, revenue enhancement, and profit maximisation.
It should come as no surprise, though, that accountants have increasingly become more focused on advice-related activities. In fact, the role of professional accountants is moving away from manual and transactional tasks, towards more strategic and corporate advisory. The role of accountants doesn’t only come down to managing books – nowadays, accountants can assist in making more data-driven decisions and optimising finances in the long run.
Here’s when accountants’ responsibilities may start to resemble the role of financial advisors. In reality, however, these two professions are more different than you may think.
Financial advisors vs accountants
Even though accountants can offer valuable advice based on the current financial situation of their clients, they don’t really specialise in telling them how they should spend or invest their money for the long term. When it comes to any advice on potential investments, it’s better to turn to financial advisors.
A financial advisor is there to help their clients understand the best investment options for their business. They simply use their knowledge and expertise to prepare specific plans aimed at achieving set financial goals, and they check in with their clients on a regular basis to see how well the execution of these plans is going.
An important part of the financial advisor’s role is to assess the current “financial health”, along with what is it going to take to meet the future goals of one’s business. They are often hired when there’s a need to get finances back on track, or a desire to expand – but the truth is that their assistance can be used at any time, to better understand complex investment, insurance, and tax matters. Their role surely changes with time – but not as rapidly as when it comes to accounting professionals.
The changing role of accounting professionals
The role of modern accountants is now much more focused on providing relevant insights and advice. Even though the scope of their expertise is not quite the same when comparing it to financial advisors – the shift towards more advisory services offered by accountants is visible, and they are quite a few good reasons for that.
To start with, the increase in accounting automation affects the time and effort spent on manual and rather time-consuming tasks. This way, accountants gain more time to focus on other, more demanding activities. In fact,research shows that the accountancy profession will be more and more impacted by automation, cloud solutions, and accounting software. All of these factors change the way financial data is stored
The impact is not always negative. 89% of surveyed accounting professionals claim that advances in technology are a real positive for the profession, creating new opportunities and removing tedious manual work. 75% also admitted that the technology they have started using has already either made their job easier or freed up time for them to concentrate on adding value for clients (i.e. by analysing accounts more carefully and giving business advice accordingly).
That’s hardly surprising, given that accounting software has shifted to the cloud and offers plenty of relevant features and integrations to the main bookkeeping solution. Once the numbers are more easily tracked by more and more sophisticated tech solutions, clients expect much more from their accountants.
As a matter of fact, clients are now more willing to take on the bookkeeping themselves – especially since there are plenty of advanced, yet easy-to-use tools that can help them out. In exchange, they are looking for more strategic advice and the ability to answer more complex questions around these new accounting applications they’ve been using.
It’s technological advancement paired with rising client expectations that has actually resulted in the birth of the “Accounting Technologist”. The job title might not be used as frequently (yet), but many businesses have already recognised its importance.
Accounting technologist – a new role in a modern company
Basically, accounting technologists are the accountants and bookkeepers who embrace the rapid advances in technology, stay up-to-date with technological trends and are open to use them, while trying to adapt the current accounting software to meet the needs of their clients.
This is actually reflected in their ability to assuage doubt around the accounting apps in use, and provide basic training to their clients on how to best use and integrate these apps. In fact, accounting technologists know exactly what apps to connect to the client’s cloud accounting software to serve them properly.
In turn, having this kind of knowledge and being tech-savvy actually helps businesses to close the books faster, become more productive, and drive more value to the organisation in the long run. And that’s precisely why accounting technologists are well sought after.
What does the future hold for accounting professionals?
It’s an exciting time to be in the industry, as both accounting specialists and employers continue to adapt to a new tech-driven reality. To ensure they’re ahead of the competition, though, accountants might soon have to invest in their skills and become more tech-savvy to stay relevant.
Also, as more and more powerful software is used to serve the clients, the need for Accounting Technologists is likely to continue growing. It’s also likely that software and technology will be increasingly covered in accounting courses and professional certifications
At the same time, however, accounting professionals who specialise in software shouldn’t neglect the skills which have always been used in their profession in the first place. The ability to keep up with accounting technology is one thing, but having checks and balances in place is still important. This way, accountants can tell whether an automated system is working properly, and carry out the process manually if necessary.
If you’re working as an accounting specialist yourself, you might have already noticed that your job is evolving due to the rise of new technologies and innovations. Stay up-to-date with accounting technology – follow Amaka and join our advisor’s hub to be at the forefront of the revolution.