Blockchain is a technology trend that is gaining more and more momentum in the accounting sphere, meaning accountants who wish to remain relevant in the accounting field can’t afford to overlook or ignore it any longer.
Blockchain is a digital ledger of economic transactions; it is completely transparent and it is also impossible to hack. Blockchain technology is defined as an open, distributed ledger. Blockchain technology works by establishing a continuous record of “blocks” containing a timestamp, resistant to modification or retroactive alteration, to record and verify transactions without any trusted central authority.
Blockchain and accounting
While we tend to associate blockchain with Bitcoin, the impact blockchain technology can have is much more far-reaching. Rather than companies keeping and reconciling records of a transaction in their own private databases, both sides of the transaction can be recorded simultaneously in a shared ledger—making it easy to see how traditional methods of invoicing, contracting, payment processing, and other documentation could undergo a sea change.
For the first time in history, business transactions can occur between entities that don’t know or trust each other, resulting in a significant cost savings in both office and staffing costs.
Like with any emerging technology, some are threatened by blockchain technology. Some accounting professionals are concerned that auditing professionals could be put out of business as a result of blockchain technology, making education about the technology exceedingly important for accounting professionals. LIkewise, some argue that blockchain will completely transform accounting. Others aren’t convinced either way.
It is important to remember that past technology developments, such as ERP systems and cloud computing, simply changed the role of the accountant, rather than making the profession obsolete.
According to the Journal of Accountancy, the following truths, among others, are important to keep in mind regarding emerging blockchain technology:
1. Blockchain is secure and cannot be hacked
2. Blockchain data can create new business opportunities
3. Educating yourself on blockchain will pay off
How FYIsoft can help you
FYIsoft has 8,500 users and counting, and the team is ready to help upgrade your software, process, and workflow.
FYIsoft’s easy-to-use cloud solutions simplify even the most complex financial reporting demands by automating manual processes and enabling users to get the right information to the right people.
FYIsoft solutions help users with financial reporting, management reporting, financial consolidation, close management and reconciliation, report distribution, and more.
To start reaping the positive benefits of cloud software, including improved data accuracy, security, 24/7 access, automation, and improved communication, contact FYIsoft for a demo today.