Ever since the first alternative to the traditional currencies (or in other words – Bitcoin) has appeared on the global financial market, the revolution in many aspects, fields, geographic areas, and professions has started to happen.
The crypto revolution, however, didn’t begin the first minute after Bitcoin creators released this decentralized currency as a response to the global recession that was happening at that moment. Although the first crypto was invented 12 years ago, it took a couple of years for people to start realizing what’s happening, what cryptocurrencies are, how they can take advantage of them and what are the benefits of purchasing, trading and investing in crypto.
But other than the fact that there is something called decentralized money, which doesn’t depend on any third parties, and is much safer, convenient and easier to navigate, what’s even more impressive is the technology behind it, that makes it into what it is, and that’s – the blockchain technology. This record or a system is made to keep track of every transaction made within. The reason behind this is simple: everything that is happening in the
chain should be completely transparent since this is the only way for a self-regulating system like this, to function. Every block is a record for numerous transactions and no matter how many of them occur, each and every one will be visible and copied across the whole network.
According to oschain.io, this new system has proven that there doesn have to be a third party, whether it’s an institution, a regulatory body or a person, in order to control and approve financial transactions, which is what we’re used to through patterns we see in the banking industry, where everything needs to be authorized. When people realized that there is an alternative like blockchain, they were (and still are) amazed by the fact that they can have access to money, no matter where they are in the world, and that they don’t have to go through any special processes, and fill certain requirements to be enabled to have a bank account and transfer money. But this is not the only change nor the biggest thing that crypto brought. It also affects certain business areas, and there is one area in particular that’s been affected by blockchain technology and the modernization of economy and finance. That is – Accountancy.
When it comes to accountancy all data business transactions are being made and they need to be analysed, managed, stored or in other words bookkeeping of all this financial information crucial for a successful functioning of any business, no matter the field.
It’s what helps companies determine what kind of results they have, or what are the levels of profitability of the company, and how they can be improved. Whether it’s financial or management accounting, one thing is sure: there is millions of data and info that someone needs to handle and manage. This is most certainly a complex process, and that is why modern technologies such as blockchain offer better solutions for the same goals and tasks.
That being said, this is why blockchain is the future of Accountancy:
1. Lower Expenses
Financial technology innovations are always a good thing, and that is especially the case with expenses or the costs of accounting services that every company needs to pay. When it comes to maintaining ledgers, blockchain technology can offer better, cheaper solutions that would bring benefits to all the parties in the process. And every company no matter the size will be more than happy to get accurate analysis and more clarity with lower expenses while at the same time I’m creating more time and space for accountants to concentrate on other tasks that cannot be automated.
Finally, it’s important to mention that every mistake that’s been made, can potentially bring financial losses, which is also something that can be avoided by creating a system that wouldn’t have to rely on accountants and their entering of the info, but rather on blockchain automated solutions.
2. More Effectiveness in a Shorter Period of Time
We all know that accounting as a profession is a very time consuming field. Accountants spend hours and hours of their time just entering and inserting the data, making constant changes along with constantly analysing those changes and updates. After this, financial reporting and auditing is what makes the next step and this is at the same time the most important part of an auditor’s job.
However, everything that goes before this final stage such as the financial history of a company and all the changes within – is equally (if not more) important for accurate predictions, results and new ideas for improving the business and reaching certain goals.
Not only does blockchain technology provide businesses with automatic updates, but it also helps maintain accuracy when it comes to entering info into multiple sources. As a result, when accountants are relieved from the stress of data accuracy, then they can focus on all the crucial and vital parts of their job.
3. Records Cannot Be Manipulated
It doesn’t come as a surprise that accountants are worried about their jobs since blockchain brings a lot of benefits and advantages over the already existing system. The questions about the future of accounting are one of the most Googled questions, since people try to find out if they should be worried about the importance of their jobs, and the possibility of them being replaced.
However, this is not the case in reality. Blockchain technology only offers high levels of safety and accuracy, since all the data would be updated automatically, in all the registers at the same time, and could not be changed or updated manually. This would both mean more accuracy, but it would also mean that there are no possibilities of manipulation of data and certain fraudulent activities, or even hacking and cyber crimes of other kinds, which is extremely important for companies, and would help them maintain stability and control over their system.