Big data can provide accounting insights
September 17, 2014

Mid-market accounting firms have a growing base of clients that each require specific insights and attention. If accounting associations wish to deliver the best solutions tailored to each and every one of the businesses they advise, firms need to harness technology currently being adopted in a variety of industries.

Many mid-size companies are already implementing innovations that collect a host of information on their constituents and customers to learn their desires and complaints. Accounting groups can analyze all of this big data to create customized options that best represent current markets, as well as improve a number of daily operations.

Big ideas from big data
When accounting groups combine the information they've collected on their clients with information provided by the businesses and other outside sources, firms can develop a more comprehensive view of organizations and can provide more enlightened insights, reported Beyond.

Traditional duties such as audits and risk management assessments become more accurate, making a larger impact on mid-size corporations' performances too. Accounting firms need as much data as possible to uncover any hidden threats to an industry and even predict trends in the market. Associations that use predictive analytics with their accounting programs can recommend the least dangerous investment opportunities to their clients by eliminating risky choices based on existing factors, giving businesses the best chance for growth.

When firms analyze the information floating around on competitors for mid-market organizations, audits can offer more precise comparisons to rivals that show groups where they stand in their sector.

Many accounting groups already use electronic documents to make communications instantaneous and assessments more encompassing, added the source, but firms need to be careful when employing these advantages.

Is there such a thing as too much data?
While big data can provide unlimited benefits to accounting firms and their clients, companies still need to be careful when sifting through this influx of information, asserted Accounting Today. It can be easy for businesses to miss some instances of fraud. With too many employees to keep track of at all time, these mid-size organizations should turn to forensic accountants or accounting software to discover any mistakes.

"Big data presents a real opportunity for businesses to glean actionable insights from information. However, the downside is that it also presents a risk because the more data available, the harder it is to spot fraudulent activity, such as the creation of a fictitious employee or an improper payment to a vendor. To combat this risk, businesses rely on forensic accountants for their expertise digging deep into the data, unraveling the work of criminals and detecting that fraud," Jolene Fraser, chair of the American Institute of CPA's survey committee, told the source.

Nexus: G-WEBCD1