4 new-norms that SME-focused accountants should be ready post Covid-19
As a result of various forms of “Lockdowns” to fight against the spread of Covid-19, many Small-Medium Enterprises (“SME”) are forced to implement and adopt Work-From-Home (“WFH”) policies even as many SME companies have not previously planned for such policy to be in place.
This incident will be very likely accelerate the digitization process of these SMEs in the coming months as we can expect the following 4 scenarios to be the new norms:
1. The growth of Cloud-based accounting software usage
Traditionally, most Malaysia SME companies uses desktop-based accounting software from traditional software providers. While some of the desktop-based software providers have upgraded their software with cloud functionalities, their offering currently still have certain limitations.
In developed markets such as US, UK and Australia, their SMEs have been adopting Cloud-based accounting software even before the Covid-19 outbreak, with the more popular softwares being Xero and Quickbooks. These cloud based accounting software have syncing functionalities which will enable them to link directly to certain banks, which would mean all the bank transactions can be imported into the accounting system automatically once approval is given. This will save a lot of time on data entries and allow the accountants to focus on more critical business areas.
As of now, Xero have a strong presence in Singapore and Hong Kong and the growth rate for the rest of the emerging markets in South East Asia is very encouraging even before the Covid-19 outbreak. WeCorporate and our clients have begun migrating into Cloud-based accounting software and is a Xero certified partner.
2. Moving towards paperless record keeping
Gone are the days where business owners have to keep all the thermal-based receipts and hardcopy supplier invoices while worrying that these receipts will face and no longer be valid.
We predict that there will be more and more regional SMEs owners that will utilitise softwares such as Receipt Bank to store these digital receipts. Some may even opt to take photos or scan receipts and upload these into cloud storage, hence reducing the physical paper which takes out space and time to arrange and file. This in fact is good for accountants as we can now access those documents anytime, anywhere over the internet.
3. Increasing use of Outsourced service providers
One of the possible scenarios is the increasing use of outsourced service providers on finance and accounting related matters. Given that cloud based technologies allows the accountant to provide service remotely, from issuing invoice to recording expenses, this removes the barrier of an accountant having to physically be present in the client’s office.
Further, accounting and finance functions within a company will usually be deemed as cost centre rather than profit centre hence as part of cost control measure, the business owners would be more keen to outsourced this function if the accounting service providers can offer seamless support. Apart from cost-savings, this will also reduce the employment compliance requirement when using outsourced service providers rather than hire a permanent in-house staff.
4. Request for accounting services beyond routine data-entry
There will be more expectations from business owners that accounting service providers should be able to value-add beyond routine data-entry, ranging from accounting treatment, employer’s regulatory responsibilities to taxation advice. While the business owners do not expect an immediate answer, they would expect the service providers to have the resources to assist them on these queries.
Service providers should also develop business acumen to offer strategic advice based on the financial statements prepared. Further, strong analytical skills will be desirable as this will assist the business owners to understand the performance of the business and able to plan accordingly.
In summary, today’s accountants will need to develop agility in adopting to changes in accounting standards, tax laws as well as technology in order to excel and provide the desirable level of service to their clients.
WeCorporate offers a variety of corporate services to SME companies in Malaysia, servicing over 1,500 clients. Click below for the range of services WeCorporate offers:
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