Published by Jessica Weisman-Pitts
Posted on November 2, 2021
As we enter the final quarter in 2021, it seems an opportune time to look back on the last 18 months and take stock of how senior finance professionals have adapted to COVID — and the role accounting software has played over that time. Looking at GrowCFO’s most recent survey, it’s reassuring to know that 93% of respondents said they seamlessly adapted to remote working when the UK Government announced the first lockdowns — albeit in some instances with a couple of minor workarounds (7%). Only 1% said that they could not.
This is reflected in the fact that 70% of respondents now use cloud-based accounting and finance software, while 26% have on-premises solutions that allow remote access. Just 3% of finance departments said they still used on-premises software that did not allow remote access. This marks a significant shift in attitude for a sector that has often been accused of conservatism when adopting new technology.
However, one of the most profound results of the lockdowns was the unprecedented long-term, post-pandemic shift by finance leaders to home working — and the realisation that they could do their job effectively without needing to be in the office Monday through Friday. Indeed, 90% of respondents told us that they plan to adopt a hybrid way of working.
The planned increase in hybrid working requires even tighter integration between accounting and finance software and other core business systems. Yet, according to our findings, there’s still a long way to go.
The most regularly adopted integrations are currently Expenses (21%), CRM (9%) and Reporting/BI (9%). However, financial teams are also starting to show early signs of integrating Robotic Process Automation, Banking, HR, Payroll Software, Optical Character Recognition (OCR), and Making Tax Digital. Looking ahead, accounting teams are planning to integrate their systems with other software across their organisations. Some examples include Advanced BI (41%), Workflows (39%), Mobile Expenses (33%), Cloud (33%), OCR (30%) and AI (29%).
It’s interesting to note that most current and planned integrations occur with applications outside of the traditional accounting function — but with those that still impact and influence the department. This speaks of a need for specialist best-in-class software for each part of a business, rather than an inter-departmental, one-size-fits-all approach that would undoubtedly lead to compromised functionality within each team. It’s also symptomatic of the evolving analytical role and strategic reach of financial departments.
Although the intention is there to take advantage of more advanced accounting software functionality, there’s still a lot of misunderstanding amongst some finance leaders about what their current software can actually do. Anecdotally we can tell you that, when quizzed about Sage50 in our survey, some professionals thought it was cloud-native, others thought it was an on-premises solution that was available remotely, and a third set said that it was an on-premises solution that did not have any remote access capabilities. The same disparity was present when we asked respondents whether their software could offer group consolidations.
This kind of confusion could have arisen because accounting software is not always updated as often as it should be. Most cloud software provides regular free automated updates, but updates for some legacy solutions must still be done manually and be paid for. It’s worth noting that 50% of respondents said they receive automatic updates as part of their contract. But when a fee is payable, 20% of finance leaders will only apply the update if there’s a relevant functional improvement. The problem here is that it’s not always apparent at the time whether newly available functionality will be needed just a few months further down the line. Our advice, however, is that upgrades should always be implemented even if the purpose behind them isn’t immediately obvious. Remember that regular updates also include software and bug fixes that keep cyber defences current — and may offer enhanced protection from viruses and malware.
While some positive changes to finance departments have come about due to COVID, some perennial problems still need to be resolved, such as the time it takes to close month-end and create management report packs. Some respondents say that it takes more than 15 days to close out end-of-month, while others can do it in a day. Similarly, respondents told us that creating a management report pack can take more than a week.
From our experience in the field, finance leaders want to close month-end much more quickly, but they don’t believe there’s a solution to help achieve that. These results show that it is possible — but that it may require a change in accounting software or a refresher on the capabilities of the current solution. Either way, it’s becoming even more important to close the month promptly. This is because the world of finance is changing. It’s moving from a transactional-based role to a more analytical role. Boards are demanding more analysis and insight from their accounting and financial teams, and if it’s taking three weeks (as some respondents admit it does) to close each month-end, then financial leaders will struggle to find the time to deliver meaningful insights at board meetings.
Modern, highly automated accounting software is one way to achieve faster closeouts and develop more detailed analytical reporting — and the technology is there to help. But some financial leaders still harbour concerns about replacing their existing software. Respondents told us, for example, they’re concerned about potential disruption and the time it would take to install new software. Our survey revealed that the time varied considerably for those companies that did undertake an upgrade. Most respondents (36%) said it took less than a month, with just 5% saying it was more than a year. Although it depends on the size and complexity of the installation, our data indicate that in more than three-quarters of cases, accounting and financial software can be replaced in under six months.
It’s clear from our investigations that there’s a significant disparity between finance leaders when it comes to getting the most from their current accounting software and knowing what to look for when they’re considering a change. They might not be quite ready for seemingly futuristic functionality like robotic automation and optical character recognition — and might not know the value and ROI of having those features available to them right now. But the reality is that all too often, accounting heads will look for a new solution that fixes old problems — and, as a result — can end up almost overnight with a new product that isn’t up to dealing with the latest accounting requirements. That’s why it’s crucial to find a software provider, reseller, or consultant with the knowledge, understanding, and stability to help on that journey and help get the best from whichever technology they choose.
As we enter the final quarter in 2021, it seems an opportune time to look back on the last 18 months and take stock of how senior finance professionals have adapted to COVID — and the role accounting software has played over that time. Looking at GrowCFO’s most recent survey, it’s reassuring to know that 93% of respondents said they seamlessly adapted to remote working when the UK Government announced the first lockdowns — albeit in some instances with a couple of minor workarounds (7%). Only 1% said that they could not.
This is reflected in the fact that 70% of respondents now use cloud-based accounting and finance software, while 26% have on-premises solutions that allow remote access. Just 3% of finance departments said they still used on-premises software that did not allow remote access. This marks a significant shift in attitude for a sector that has often been accused of conservatism when adopting new technology.
However, one of the most profound results of the lockdowns was the unprecedented long-term, post-pandemic shift by finance leaders to home working — and the realisation that they could do their job effectively without needing to be in the office Monday through Friday. Indeed, 90% of respondents told us that they plan to adopt a hybrid way of working.
The planned increase in hybrid working requires even tighter integration between accounting and finance software and other core business systems. Yet, according to our findings, there’s still a long way to go.
The most regularly adopted integrations are currently Expenses (21%), CRM (9%) and Reporting/BI (9%). However, financial teams are also starting to show early signs of integrating Robotic Process Automation, Banking, HR, Payroll Software, Optical Character Recognition (OCR), and Making Tax Digital. Looking ahead, accounting teams are planning to integrate their systems with other software across their organisations. Some examples include Advanced BI (41%), Workflows (39%), Mobile Expenses (33%), Cloud (33%), OCR (30%) and AI (29%).
It’s interesting to note that most current and planned integrations occur with applications outside of the traditional accounting function — but with those that still impact and influence the department. This speaks of a need for specialist best-in-class software for each part of a business, rather than an inter-departmental, one-size-fits-all approach that would undoubtedly lead to compromised functionality within each team. It’s also symptomatic of the evolving analytical role and strategic reach of financial departments.
Although the intention is there to take advantage of more advanced accounting software functionality, there’s still a lot of misunderstanding amongst some finance leaders about what their current software can actually do. Anecdotally we can tell you that, when quizzed about Sage50 in our survey, some professionals thought it was cloud-native, others thought it was an on-premises solution that was available remotely, and a third set said that it was an on-premises solution that did not have any remote access capabilities. The same disparity was present when we asked respondents whether their software could offer group consolidations.
This kind of confusion could have arisen because accounting software is not always updated as often as it should be. Most cloud software provides regular free automated updates, but updates for some legacy solutions must still be done manually and be paid for. It’s worth noting that 50% of respondents said they receive automatic updates as part of their contract. But when a fee is payable, 20% of finance leaders will only apply the update if there’s a relevant functional improvement. The problem here is that it’s not always apparent at the time whether newly available functionality will be needed just a few months further down the line. Our advice, however, is that upgrades should always be implemented even if the purpose behind them isn’t immediately obvious. Remember that regular updates also include software and bug fixes that keep cyber defences current — and may offer enhanced protection from viruses and malware.
While some positive changes to finance departments have come about due to COVID, some perennial problems still need to be resolved, such as the time it takes to close month-end and create management report packs. Some respondents say that it takes more than 15 days to close out end-of-month, while others can do it in a day. Similarly, respondents told us that creating a management report pack can take more than a week.
From our experience in the field, finance leaders want to close month-end much more quickly, but they don’t believe there’s a solution to help achieve that. These results show that it is possible — but that it may require a change in accounting software or a refresher on the capabilities of the current solution. Either way, it’s becoming even more important to close the month promptly. This is because the world of finance is changing. It’s moving from a transactional-based role to a more analytical role. Boards are demanding more analysis and insight from their accounting and financial teams, and if it’s taking three weeks (as some respondents admit it does) to close each month-end, then financial leaders will struggle to find the time to deliver meaningful insights at board meetings.
Modern, highly automated accounting software is one way to achieve faster closeouts and develop more detailed analytical reporting — and the technology is there to help. But some financial leaders still harbour concerns about replacing their existing software. Respondents told us, for example, they’re concerned about potential disruption and the time it would take to install new software. Our survey revealed that the time varied considerably for those companies that did undertake an upgrade. Most respondents (36%) said it took less than a month, with just 5% saying it was more than a year. Although it depends on the size and complexity of the installation, our data indicate that in more than three-quarters of cases, accounting and financial software can be replaced in under six months.
It’s clear from our investigations that there’s a significant disparity between finance leaders when it comes to getting the most from their current accounting software and knowing what to look for when they’re considering a change. They might not be quite ready for seemingly futuristic functionality like robotic automation and optical character recognition — and might not know the value and ROI of having those features available to them right now. But the reality is that all too often, accounting heads will look for a new solution that fixes old problems — and, as a result — can end up almost overnight with a new product that isn’t up to dealing with the latest accounting requirements. That’s why it’s crucial to find a software provider, reseller, or consultant with the knowledge, understanding, and stability to help on that journey and help get the best from whichever technology they choose.
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