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CLOUD NINE: HOW CLOUD ACCOUNTANCY CAN LEVEL UP YOUR BUSINESS

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CLOUD NINE: HOW CLOUD ACCOUNTANCY CAN LEVEL UP YOUR BUSINESS

The pandemic helped to accelerate digital transformation, and that has included companies’ accounting systems. Haines Watts’ cloud accountancy expert Riaz Kala explains how cloud accounting can help businesses to ‘level up’ their processes and get better value from their accountants at the same time.

The days of hand-written ledgers and shoeboxes stuffed full of receipts are long gone for most companies – but you’d be surprised how many still prefer to deal with their accounts in an analogue way. Perhaps because it is closer to the way they were trained, or perhaps it feels more tangible to them.

But the digital age is upon us. Haines Watts has been advocating the switch to digital-first accountancy for many years, and one of the impacts of the pandemic has been to accelerate that digital transformation. Companies from every sector have been clamouring to find ways to reach and sell to new audiences, and technology has been at the forefront of that.

The same goes for accounting. With a reduction in face-to-face contact, it becomes harder to hand over paperwork and files in person, so more businesses have embraced digital solutions to help streamline and speed up the process.

It’s music to our ears: we still cherish our direct client contact but switching to digital platforms means we can do so much more with the time we do have available for clients.

 

Migrating to the cloud

My role at Haines Watts is overseeing our cloud strategy and integrating our use of tech at every level of the business. Even prior to the pandemic, we had worked with most of our businesses to migrate them to platforms such as Xero, which meant we were well placed to deal with the challenges of remote working that the lockdowns presented.

However, we constantly review our use of tech and the way our clients use the cloud, and we are in the process now of migrating our remaining non-cloud clients onto the cloud from Excel or paper-based systems.

Even once we’ve got clients onto the cloud, that reviewing process never stops: part of our change management strategy is monitoring developments and making sure that knowledge is passed on around the business. We have training plans in place to make sure that we are always on top of the latest updates, such as Xero HQ and the new generation of features that brings.

 

Levelling up your accounting

At the heart of everything, though, lies our strategy for improving the flow of information to Haines Watts: when we talk about our use of the cloud, we are typically looking at three key things: Firstly, bank Feeds, ie are they using a platform such as Xero/Sage? Then comes invoice automation, and finally monthly reconciliation: how often we do speak to clients, and how often are they reconciling their information and learning from it.

Based on those stages, we have three ‘levels’ that we apply to businesses to describe their progress along the digital transformation route.

Level 1

Migration onto a cloud platform such as Xero, Sage or Quickbooks.

Level 2

Using AI, machine learning and robotic process automation to automate processes with bank feeds and rules, invoice collection and processing and payment facilitation. As processing time decreases more regular maintenance of bookkeeping software is essential for accurate and real time information.

Level 3

Integrating apps to improve processes and cashflow and management forecasting, and industry-specific apps to help improve business operations.

A company operating at Level 3 will have fantastic integration, smooth processes and will be in a position to benefit from the insights that the available data can provide.

In addition, we are now offering clients digital health-checks and finance function reviews, and doing app research that can include more bespoke apps that could be implemented outside our standard app stack, such as electronic point-of-sale (EPOS) and stock systems.

 

Benefits: beyond time saving

Without complications, a ‘standard’ migration onto a digital platform can take around a day, plus the time taken to tidy up the information, but that can vary greatly from client to client depending on the complexity of their business. Once the set-up is completed, the time taken to doing so is quickly recovered.

The time-saving alone is a compelling reason to embrace cloud accountancy, but the benefits go way beyond getting rid of the physical paper trail and saving time.

That extensive stack of digital apps can offer huge strategic and analytical benefits if they are integrated in the right way.

One of Haines Watts’ core values is that we offer true insight to our clients, working with them to do far more than simply crunch the numbers. Moving to digital buys us the time to nurture that relationship and to offer far more added-value to clients.

We work with our clients as trusted advisors, peers, sounding boards and even friends, and the intel we now have access to on a ‘level 3’ client allows us to offer incredible insights to those clients.

 

Choosing apps? Stay focused!

Xero alone has an ecosystem that supports over 1,000 apps, so it can be pretty overwhelming and difficult to know where to start. We recommend being focused and very selective, so we work loosely with our clients to make sure they are only integrating the apps that really complement their business.

We are creating an app stack – outlined below – that forms the core of our cloud accountancy toolkit and we tend to recommend using these as a starting point. They cover what we feel are the key areas of a finance function with each app having a primary use but also other uses.

We decided to limit ourselves to one app per finance function area, choosing apps that can be used in different areas as to avoid ‘app overwhelm’ with clients. However, when scoping our clients’ app requirements it is important to understand how other apps, with similar purposes, assist with their chosen processes as they may be a better match than those within our app stack.

Again, though, the most important message here is that the apps are being used properly and that the data they give you is being interpreted correctly.

 

Finance

Is your business ready for finance automation?

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Mari-Frances Bentvelzen, Business Head and General Manager of Global SMB at SAP Concur

 

As managers continue to drive their businesses through these uncertain economic times, it is important for them to properly equip and guide their organisations. Small to medium-sized businesses (SMBs) are looking to save money during this inflation crisis. By looking carefully into different areas, there are many hidden costs that can be found to combat rising expenses and interest rates.

With 2023 approaching, it’s time for businesses to be more proactive towards improving their processes. Automating administratively heavy tasks can be hugely beneficial in saving time and resources, both of which can have a big impact on the bottom line.

Although travel logistics, expense tracking and invoice processing can sound like a lot of background noise, these processes can all be optimised through automation. This offers more visibility for finance leaders and helps free up valuable time and resources for employees within the organisation.

Identify which key areas need automation

The first step to adopting automation is highlighting which areas can be improved with specific technology. This includes auditing the business and identifying which areas are outdated. From this point, businesses need to determine which processes and procedures may benefit from digital transformation. High on the list are manual processes and data input — two areas that often are riddled with mistakes and delays. Automating these areas proves to be useful for both the organisation and its employees.

Another common issue that finance leaders face is lack of access into full spend visibility. To improve decision making, managers must be confident about the trusted insights, transparency and perspectives in their business. Reporting tools and automated processes can help verify expenses through integration with other vendors and systems.

Without automation, it is difficult for finance departments to ensure all data has been inputted and centralised. This can make it difficult to determine the most appropriate and potentially effective areas to target cost-saving measures. Spend management solutions can, however, provide finance leaders with full visibility into where their money is being spend, enabling any spend that does not correlate with policy to be flagged. This can help businesses to reduce non-compliant spend and increase policy and regulatory compliance.

Find the best solution for both business and employees

Once these areas are identified, the business must adjust for compliance requirements, infrastructure changes and spend changes. Finance leaders should select the best solution to streamline current processes, whilst also improving budgetary controls and employee safety and satisfaction.

It is important for companies to place employee experience and innovation at the forefront of decision making, with training and ongoing employee support. Expenses — the reimbursement process, specifically — often have an under-appreciated role in employee engagement.

In fact, the new SAP Concur Employee Experience study reveals that 70% of employees in the UK are concerned about the impact of cost-of-living increases on their personal finances. And it’s late reimbursements for expenses that are causing employees to worry, with 56% worried about delayed reimbursements impacting their personal finances. This is why it is crucial for organisations to adopt automation to help accelerate processes and relieve reimbursement worry.

We worked with Brother UK (Printing and technology solutions) to automate their processes within their internal finance department. Brother has many employees who have worked for the company for more than two decades, with many processes identical to the day they started. Unsurprisingly, these employees were reluctant to making big changes, as they were used to carrying out their work in very specific ways. And with the obvious talent crisis, Brother realised that it was more important than ever to focus on the employee experience.

Brother put their employees first, ensuring communication remained transparent during the entire project. The company also brought staff directly into the decision-making process, elevating buy-in and a sense of ownership over forthcoming changes.

Now that Bother has automated many financial tasks, employees within the finance department are able to spend more time on strategic and rewarding work, rather than menial and time-consuming tasks. This improvement has been a positive experience for all. It has also helped employees to progress further in their careers.

Plan for the unpredictable future

Do you work for an SMB considering such changes? Don’t hesitate — now is the time to take the proactive step to streamline and grow your business. Overall, SMBs are being faced with the unknown and are being forced to adapt or pivot their business models. Finance automation will help futureproof your business during these uncertain times, bringing a level of stability to your organisation. This will allow employees to focus on future growth ambitions and make more informed decisions without having to worry about laborious tasks.

It’s important to remember a key part of running any business is relationship management — both with customers and employees. It’s important to choose solutions that will help drive profit margins whilst also acknowledging employee needs. For small businesses, maintaining clear communication with employees will not only help to ensure solution implementation is successful, but will also help to soften any resistance to automation.

And there’s so much more beyond basic finance automation. By taking an even deeper dive into invoices and expenses, businesses can find key data to help underpin certain goals such as reducing carbon emissions for business travel or enabling employees to submit expenses from anywhere at any time.

In the long run, digitising tired manual processes makes it more affordable for all businesses, no matter the size, to offer a competitive advantage during this era of change.

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Business

What is the True Cost of SMS Phishing?

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Gemma Staite, Threat Analytics Lead

 

Cybercriminals will recycle attack strategies for as long as they are effective. In Fraud scammers will keep using a method for as long as victims continue to fall for it. SMS phishing is no exception, as shown by a recent wave of attacks globally, particularly in Asia that caused millions of dollars in financial damages.

SMS phishing, often known as smishing, is a type of social engineering assault that preys on victims through their mobile devices. Smishing attacks use texts that appear to be sent by reputable sources. The messages contain links that drive unsuspecting victims to a phishing site where they are asked to divulge personal information, download malware onto their mobile device, or provide a one-time passcode that will allow a criminal to bypass multi-factor authentication (MFA).

Smishing has increased significantly across the globe and complaints about SMS spam increased over 140% last year. Smishing remains a big concern as users spend so much time on their mobile devices – an average of five hours per day in 2021. In addition, users are much more likely to open a text message. According to MobileMarketer.com, SMS recipients open 98% of their text messages while email recipients only open about 20% of their messages.

The ability to launch attacks has also gotten easier for criminals. There are SMS bots that can be used to intercept the one-time passcode (OTP) most banks use for step-up authentication. There are bots that can reach thousands of potential victims at a time with messages that appear to come from a victim’s bank or other trusted brand. Netflix, the most popular streaming service in the world, was recently exploited to serve as the face of a massive smishing campaign that attempted to divert users to a phishing site.

 

Beyond SMS Fraud Losses: A Case From Singapore

A smishing attack’s fraud losses are scarcely insignificant. An alleged recent attack in Singapore cost a bank S$13.7 million over 790 victims. That works out to an average of S$17,300 ($12,800 USD) per person. The business is required to pay around $4 for every dollar the customer loses due to fraud. This high cost excludes reputational damages and any potential clients lost as a result of people associating the institutions with higher scam risk.

Direct fraud losses can be quantified, but other costs are not so easy to put a price tag on. First, there is the operational costs such as an increase in calls to the contact centre. This one attack reportedly caused calls to surge 40% in one week. Second, there is the reputational costs of negative headlines from such an attack being reported to the media and the potential customer attrition that may result. Finally, there are potential regulatory costs when such incidents catch the attention of regulators.

The Monetary Authority of Singapore (MAS) and the Association of Banks in Singapore (ABS) released a set of guidelines in response to the recent string of smishing attacks targeting banking customers. Some of the security measures make sense, such as removing clickable links in emails and SMS messages sent to customers. However, others seem to be counterintuitive and go against the very premise of convenience offered by digital banking. For example, requiring notifications and confirmation from customers for every transfer that exceeds S$100. This adds unnecessary friction for customers who have come to rely on the ease of digital transactions on the go.

Increasing friction doesn’t make fraud issues disappear. Additionally, it can cause customers to lose track of messages and become confused, leading them to miss important alerts when fraud may be present.
Increasing current fraud controls

Because fraud can be prevented via device, IP, and network-based restrictions, scammers have developed ways to get around these. Cybercriminals will always find new cunning ways to social engineer around authentication restrictions. Banks must examine users’ behaviour patterns, including how they type, move the mouse, and explore a website, in addition to the device they are using. With the addition of behavioural biometrics to their existing fraud controls, several sizeable financial institutions are already achieving better fraud detection outcomes for a variety of use cases, such as account takeover, account opening, social engineering fraud, and mule account identification.

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