The COVID-19 pandemic hasn’t done many people favors, and in addition to the health risks and accompanying stress, almost every industry has had to flip itself on its head in order to continue doing business. Stay-at-home orders forced many companies to adapt to remote work, and other pandemic regulations caused businesses to completely change their models just to continue making money.
The accounting world was no different, and with so much newly legislated government money being dished out for business help and individual stimulus, the changes have been quite taxing for many individuals in the bookkeeping industry. Most people have seen the surface changes that came with quarantine, such as Zoom meetings, at-home-yoga breaks, and even changes in financial planning, but with so many moving parts pertaining to income, accountants have had to adapt both in how they work, and what tools they use to complete their work.
Here is a closer look at how accounting has changed in the wake of the COVID-19 pandemic.
As the pandemic sent people and businesses into quarantine, the feelings of being stuck were very strong for a lot of the folks being forced to stay and work from their homes. With that, many made their “homes” mobile and retreated to a cabin, or a loved one’s house, often across state, or even international borders. The headaches that this relocation caused were aplenty, but companies were pretty much forced to deal with it, as ensuring employees are working in a comfortable space is also ensuring those employees can do quality work and want to stay around.
Some states have waived their laws regarding nexuses for employees and employers who work in a state, or employ remote workers in a state, respectively, so some headaches have been avoided thanks to legislation, but not all states were so friendly to the accounting teams. For those teams who need to be constantly aware of where their employees are working, HR technology can ensure the accounting team knows where and when individuals are logging in from, and can prepare taxation accordingly.
Even before COVID, cloud technology was being utilized as an accounting resource, and now with many accounting teams forced to work remotely, it is becoming a necessity, rather than a tool used by a few forward-thinking teams. Cloud technology allows for project management to be seen in real time, by everyone and anyone involved with a given project. When it comes to accounting, these technologies also display who worked on what and for how long.
For accounts receivable, this cloud tech can also help show clients the “why” much more clearly, as far as any questions they have on expenses and prices. Given, the fact that cloud tech allows for access from anywhere and everywhere has many, many pros, but it also means more people from different locales that will have to be weighed at tax time.
Most COVID-related issues that business faced regarding remote work were kept fairly local, but even as some employees tested the waters and moved across state and international borders to continue working, smart accounting firms have viewed this ease-of-movement as an opportunity to do business with companies who may not have previously been in their minds due to physical distance. One thing that the accounting industry must be aware of is the potential for increased fraud due to COVID-19.
Dr. Jennifer Stevens, assistant professor of accountancy in the Ohio University School of Accountancy, stated that she “would expect to see an increase in fraud in organizations. The fraud triangle describes a perfect storm of circumstances which may lead an individual to conduct fraud.
The financial burdens felt by many due to the pandemic could increase the incidence of fraud. Therefore, organizations should review their internal controls to minimize the opportunity to commit fraud, as well as enhance detection monitoring as part of a normal fraud risk management program”.
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