Small Business Accounting Technology: Embracing Innovation with UK Accountants

Discover how UK accountants harness cutting-edge Small Business Accountant Technology to drive innovation and efficiency in their practices. Explore the latest trends and advancements, and learn how these technological solutions transform how small businesses manage their finances. Stay ahead with insights into the UK’s dynamic accounting technology landscape.

The field of accounting, like all other kinds of work, is undergoing a massive transformation. The era of technology has finally caught up with old-school professionals, and accountants are no exception. 

Like other fields, such as law, for instance, professionals are relying very heavily on newer kinds of technologies which are removing a lot of the redundant work that professionals have to do on a day-to-day basis as a part of their operations. 

Contrary to what most people think, artificial intelligence is not going to kill off jobs and everyone unemployed and starving. Yes, it is true that automation is going to lead to a wholesale transformation of the job market. However, jobs are going to change, and people will do more creative and core tasks. 

In fact, we are at a place in technology like we were more than two centuries ago at the start of the Industrial Revolution. People feared mass unemployment. They thought that the machine would kill off their jobs and the rich would force everyone else to just starve. Now, we can clearly see that those fears were unfounded, and today the world is richer than it has ever been. So if you are an accountant, do not fear the rise of technology. Embrace the growth of technology, as it will make your life easier and more smooth. Technology is the best friend of a professional these days. It is not in any way or form the enemy of the modern-day professional. 

Accounting in the Digital Age

Digitalization has been a slow process in accountancy. But in recent years, the government’s Making Tax Digital program and the pandemic have accelerated the adoption of accounting software and the cloud across UK accountants, encouraging more businesses to improve their confidence in technology and realize the benefits of speed and quality. How is this changing the landscape, and what does it mean for accountancy businesses?

While spreadsheets and paper-based methods still linger, cloud-based accounting software quickly becomes the norm. This enables greater process automation and unlocking access to valuable data that can be used to train artificial intelligence models.

These technologies come with risks to the professionals and their clients. Client security, privacy, and confidentiality need attention, ethics, and an understanding of what and how the technology delivers. But when harnessed responsibly, the benefits can be substantial.

Driving change at the business and market level

The advantages of process automation are clear: greater efficiency, quality, and reduced costs for clients, with an ever-growing range of practice management software providers offering support. It also frees Small Business accountants from spending time on manual, repetitive tasks they need to be more qualified to deliver.

But when adopted in isolation, it could risk accountants’ profitability. Automation could allow Small Business accountants to provide their services at a greater scale to more clients in their market, undercutting the prices of technophobic firms and increasing market share. A ruthless market consolidation would probably ensue, leaving a few survivors and gradually erasing service quality.

Benefits of automation

The good news is process automation is only a small part of the bigger picture. Yes, consolidation could still occur for good or bad. Still, the greatest opportunity for accountants lies in the new markets and value-adding services that can be opened up by service innovation.

The movement to the cloud makes more data available and accessible than ever, not just for the client but for other businesses, opportunities, and the economy.

Utilizing AI and real-time analysis can provide new and improved insights into business performances now and in the future. This enables accounting advisory services delivered on the right topic at the right time, helping clients avoid issues and capitalize on opportunities. The client-accountant relationship can become less transactional and more strategic, opening up more conversations and opportunities to provide value.

New tools for new opportunities

For a Small Business Accountant, developing and learning how to use technology to deliver new services can take time and effort. While a few large firms might have the scale to invest in in-house technology, the rest of the market needs more time, skills, or capital to compete.

This is why Innovate UK accountants have funded R&D projects led by accounting tech companies that can pool resources and data from across the accountancy landscape to develop cutting-edge AI applications specifically tailored to the needs of the Next Generation Accountant. Here are some examples.

Next Precision (formerly Xavier Analytics and now part of ReceiptBank) used Innovate UK accountants’ funding to create a comprehensive benchmarking dataset and insights for SMEs. Small Business Accountants can use these to provide meaningful information and targeted recommendations on their client’s business performance.

Digital tools also offer novel opportunities to help SME clients seeking finance. Access to finance can make or break for SMEs, whether to resolve short-term cashflow issues or invest for growth. However SMEs traditionally don’t shop around for the best offer, and many avoid borrowing altogether. The market is complex, and banks have traditionally been reluctant to lend without extensive information about the organization, requiring lengthy processes to obtain a quote.


 Is a multi-award-winning intelligent cashflow forecasting software company used by over 500 accountancy firms across the UK accountants? With grant funding from Innovate UK, they’ve expanded their capability to provide a fast and hassle-free business funding service. Developed and tested in partnership with accountants, their software automatically identifies a client’s need or opportunity for funding, whether to resolve a short-term cashflow issue or investment to growth. It then provides specialist recommendations for funding and links to providers specific to the client’s need while taking care of the hassle of providing credit information. Azets, the UK’s largest SME accounting firm, has already started using Fluidly’s services to provide specialist financial advice to clients.

Similarly, has expanded its capabilities in providing a funding recommendation service for Small Business accountants and their clients, coupled with advanced benchmarking reports to enhance the understanding of their Fclient’s positions. They’ve recently secured £10 million in investment to launch a new integrated risk management platform for accountants to identify and protect against unforeseen risks to their clients’ and suppliers’ credit position.

Helping Small Business Accountant Firms adopt Digital Tools

These are just some examples of tools that can form part of a Small Business Accountant’s ‘tech stack. This is to enable them to shift away from a compliance-focused business model into advisory-based services. But to succeed at this, accountants need to do several things:

  • Have an open mindset toward innovation.
  • Ensure they have the right skills in their firm to use technology and implement new business models.
  • Learn how to engage and collaborate with technology providers in R&D to develop solutions and services that meet clients’ needs.

We funded Oxford Brookes University’s NextGenPSF project to investigate the challenges of mid-sized professional services firms. In particular in adopting and implementing AI technologies.

They’ve developed a range of insights and business model innovation toolkits. Also, 2030 scenario analysis to help professionals prepare for the future.

To support greater collaboration, we funded the AI for Services Network.  This brings together AI businesses and academics with professionals in law accountancy, insurance, and finance.

Small Business Accountants have specialist knowledge and relationships with their clients, which technology will only replace. Still, if they do not properly use technology, they will be replaced by those who do.

The reward will span beyond the accountant’s success, as seen in the examples of SME support.  These things have the potential to help the economy become more resilient and unlock business growth.

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