Old wine in new bottles

X is coming!!!!! We're going to be out of a job. And then you can replace X yourself with robots, AI or machine leasing or blockchain or maybe something completely fifth.

I might just not entirely agree.

But why do I disagree? I kind of aren't, but for me there are a whole bunch of steps to come before all fluffy buzzwords. These are things that finance departments have been doing for decades. This includes having a properly aligned bank, or transferring payments from your financial system to your banking solution. Preserved, 20 years ago this was via modem to Unibank, and today it can then be from e-conomic via the Internet to, for example, Nordea. But the thoughts behind and the processes are the same. FIK, also called "common deposit cards" has been around for a lifetime. It's still a technology that's being used to this day. However, like many older accountants, it has been spiced up a bit with tech.

Failed bookkeeping

The reason I balk at all the clever phrases is primarily that I sometimes experience having to take over a failed bookkeeping. For me, an accounting is broken when there has not been a bookkeeping in e.g. 6 months, the auditor's post-entries from the last financial statements are not posted in place and there is no control over documents at all or who owes whom money. In fact, it takes quite a long time to rectify this shipwreck. It may be smart to implement all sorts of technological wonder solutions, but it makes no sense at all without understanding the company's processes and needs. At the same time, there is also a general spring cleaning in the bookkeeping to be done.

Bank connect

Many of the solutions we use are based on existing technology or add an extra layer to these. One of the first things we're trying to get started is something called bank connect. It's a technology that means you get a list of what you should post in your financial system, as this list shows what's actually happened at the bank. For me, the starting point for everything in the bookkeeping – is that you have control of your bank.

Depending on the size of the company, it may make sense to keep a good handle on the creditors (i.e. those we owe money). This is in itself a classic task and in most financial systems there is also a payment module so that you can generate a payment file for the bank without typing. What happens is the following:

  1. The invoice you want to pay will be posted as paid in your financial system
  2. Your financial system makes a payment file that you can upload to your online banking.
  3. Once you have uploaded to the bank it must be approved and invoice paid

So steps 1-3 are solved by just clicking a few times with your mouse – that's pretty smart.

What's really interesting is how to get to step 1. This is where the new digital solutions come up. There are a lot of software solutions that can read this data and automatically deliver it in your financial system so you are ready for steps 1-3.

Some can even make steps 1-3 for you without you having to do anything yourself. Of course, it requires that there is money in the account otherwise, unfortunately, not much happens.

GOT the card

One of the other areas I've mentioned is the FIK card. It's a way to pay bills and the advantage of it is that data is unique. When you make a regular bank transfer, you are free to type anything in the transfer message. This is not at all possible when, for example, you want to use the field to select the

But again here we see old technology being injected with extra horsepower from new players in the market.

And that's basically my whole point. The old virtues never go away. It never goes out of fashion. It doesn't become unnecessary to have control over your bank reconciliation, your customers or the people you owe money. It's the way things can be solved now that's going to be different.

It's about keeping things on track

And for me, the solution to things is a kind of "old wine in new bottles" because much of what we do now is repetitions of processes that are over 20 years old. It's just made easier and more automatic. There is still a need for someone to think about when accounting is running on rails, precisely to ensure that things stay on the rails. We as accountants have unique opportunities to automate many of the usual work processes such as payments, interpretations and matching of vouchers. This means better time for e.g. jerking customers, reviewing insurance, following up on budgets and calculations, and many other things.

In my world where we sell hours for a living, this typically means that the tasks are only solved faster and that there is room for many more customers. Our most important task will be to use the lego bricks that are exactly right for you so that both you and I and everyone involved in administration saves as much time as possible.

 

Written by:

Frederik Sandgrav

Frederik Sandgrav

Frederik, also known as "The Luddovne accountant", has over 10 years of experience in digitizing and automating bookkeeping

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