Accounting is widely considered to be stale and slow moving profession, that is rich in history but poor in adaptation.
Whenever I’m invited on TV or to conferences to talk about financial topics I always make the point that the industry is terribly outdated, and needs to change.
The problems
Accounting needs to change for a myriad of reasons including:
- The negative effects the 2008 financial crisis had on the world economy.
- The introduction of electronic invoicing and accounting software.
To put it simply, the jobs of all accountants are under threat, technology is now adept at doing a large portion of their job and will soon completely replace them, so accountants will have to pivot to remain relevant.
They need to start providing added value to their clients in the form of tax consultancy which can help clients:
- Reduce their tax bill
- Advise clients on how to maximise their earnings
- Advise clients on how to avoid financial problems in the future
In this way they can act more like a business consultant, becoming a far more valuable member of an entrepreneur’s team than just a typical accountant. Accountants who either already operate in this fashion or make the change to do so in the near future will be able to differentiate themselves from their competition and future proof themselves from technological developments.
Bureaucracy is a waste of time
Time is the one currency we have a truly finite amount of, once it’s gone, it’s gone.
So of course, we want all of our tasks completed as soon as possible.
Artificial intelligence can make this happen, much faster than humans can.
AI can do the following:
- Generate Invoices
- Search through hundreds of transactions in seconds
- Detect fraud
- Rectify human error
Saving businesses worldwide billions of pounds in administrative costs each year as a result.
Entrepreneurs should be able to focus on building life changing society altering businesses, not bogged down in menial admin tasks. They need a team around them to help them achieve their goals. Part of that team must be a brilliant accountant, who works closely as a consultant.
To be able to do this they too have to be freed from the prison of admin which could be done faster, better and cheaper by a machine.
The data is clear: in the management of company accounting, most of the time is wasted in manual and repetitive activities. The University of Oxford classifies the keeping of accounting among the most easily automated jobs (with a probability of computerization of 96%) and McKinsey expects that 86% of the activities related to accounting in the future will be automated.
Companies spend on average 204.2 hours per year dealing with slow moving financial processes and bureaucracy. This is essentially time wasted as it could be better spent on activities that actually help grow the business.
The solutions
As an entrepreneur, I’ve developed a wealth of knowledge of the Italian finance sector, which is one of the most complex in the world. This know-how allowed me to understand how the support of a good consultant is fundamental to business success.
I had the best accounting team available, but I always ended up talking to them about deadlines and payments. We never had a chance to discuss solutions that, would reduce my tax bill and allow me to invest more money into growing my company.
In 2013 I risked losing everything. One of my companies ran into financial difficulty, and was at risk of going bankrupt, because of an accounting error.
A small detail that was going to cost me everything I had worked so hard for.
This sparked an idea; How many entrepreneurs think they need an accountant, when really what they’re looking for is a business consultant?
So I created “Soluzione Tasse”, one of the biggest accountancy firms in Italy, with a network of 30 accountants specialized in tax savings for entrepreneurs and businesses.
We’ve acquired 10,000 customers in just two years thanks to the implementation of new technologies.
Due to my experience on the other side of the fence, I immediately understood that in order to help companies solve this problem, I had to look at it from a different perspective.
Through the most advanced OCR and optical scanning technologies, we have immediately enabled our customers to transmit all documentation (invoices, expense notes, etc.) to the reference accountant in a matter of seconds. All without the possibility of error.
This experience has built the foundations so that the model and the technologies adopted by our group could be exported and evolved in what then became a world protocol.
The revolution within a revolution
The invention of the blockchain was revolutionary, it allows us have a public, electronic, virtually incorruptible ledger. It’s also decentralized and independent of states and / or banks.
I have always been convinced that transparency is of fundamental importance in all sectors of the economy. When I discovered the blockchain, I immediately believed that this technology could immediately be a game changer for companies throughout the world.
Soon after I started XRIBA, the first protocol that brings business accounting into the public blockchain, with the aim of adding transparency to company finances.
Through the use of artificial intelligence and OCR, it allows accountants and entrepreneurs to save up to 72% of the time spent doing accounting tasks.
Xriba can automatically record every single transaction, and has the potential to alter the way we do business forever.
With Xriba, an invoice will be sent, categorized, archived and automatically prepared to be paid for thanks to the OCR and Artificial Intelligence.
A series of business intelligence reports will be available to the user to keep on top of all the company’s financial KPIs in real time.
Xriba provides a business management model that can lead to a more consultative and value-added working methods for accountants. This translates into less time doing quantitative analysis and more time spent on qualitative.
In addition to AI being able to automate accounting, which greatly reduces the workload of accountants, the blockchain, the revision process can be made more efficient.
The auditors can adopt the certification and the inviolability of the blockchain to avoid obsolete confirmation requests to customers and suppliers, basing their reports on the intrinsic certainty of the blockchain.
Xriba can be instrumental in revolutionising the accounting and auditing processes around the world. Finally allowing accountants to become valuable business consultants for companies and entrepreneurs.