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The Next Stage: Beyond Accounting Software

In recent years, we have witnessed the transformation of the finance function as we know it. These changes have affected everyone, whether you are working in house as a finance professional, as a partner in a large accounting firm, even if you are running your own practice.

Chief amongst these changes has been the emergence of SaaS (Software as a Service) or cloud based accounting software e.g. Xero, Quickbooks Online, Freshbooks and FreeAgent, where increasingly sophisticated low cost cloud based applications have transformed the landscape. These applications are changing the dynamic of accountancy for ever. Many of these applications are designed to improve efficiency, and to free up the accountant’s time, to enable them to add value rather than to have them spending time working primarily on administrative tasks.

Similarly, from a user perspective, the value of SaaS applications is all too apparent; low cost solutions, that help to increase productivity and provide real time data access from wherever you are. The service element of SaaS is vital, and these applications primarily operate on a subscription basis. With a free trial available, the purchase decision is made based on prior testing of the platform, facilitating an easy way to evaluate. In the absence of lock in, cancellation is a mere click away and thus the incentive to continue offering value on an ongoing basis is extremely high.

Another major development has been the emergence of a growing ecosystem surrounding these core accounting applications. This ecosystem can take many different forms; ranging from links to financial service institutions, through to API’s (Application Programming Interfaces) into third parties like Expense Management applications e.g. Rydoo Expense. Finally, many of these SaaS applications have a foot in the mobile world also, utilizing of the power and ubiquity of mobile devices to capture data as well as to report on it. Data no longer resides exclusively on someone’s computer, but is readily accessible from anywhere. Foreword _ “Our clients are really enthusiastic about Rydoo expense and the tool works really well for both the accountant and the client”.

While some in finance circles may have been be slow to embrace these new applications, startups have not been. Nowadays most tech entrepreneurs can function with just a smartphone, a laptop and an internet connection. They have embraced the emergence of SaaS applications with vigour, which is not surprising given that many of these solutions offer real value at compelling price points.

In conclusion, this short paper explores the above themes in more detail, helping those finance professionals still persisting with manual processes (for non core accounting activities) to understand how complementary applications from the wider SaaS based ecosystem can support their goals. We hope you find it of interest.


For people working in finance, recent years have been characterized by profound changes. Of course, change is never easy, particularly for a finance profession that had largely remained the same in the preceding decades.

“There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things. Because the innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new.” Niccolò Machiavelli, The Prince (1513)

Nonetheless SaaS based accounting software applications have become ubiquitous, with many accountants and finance professionals embracing them wholeheartedly. A decision to adopt these cloud based solutions is not straightforward however. For some, they may have had initial concerns about perceived learning curves (and the time commitment needed). For others, the concern may have been rooted in the fear that these applications would replace core elements of the finance function. Thankfully these suspicions have proved unfounded.

For those who did switch to these new cloud based offerings, they quickly realised that the learning curves were not particularly steep, and that many of these applications are remarkably intuitive compared to legacy systems of the past that they may have encountered previously. Again these improvements reflect a new world order when it comes to software. Where once support contracts were the norm, now ‘zero touch’ support is the way to go. Where once bad design was a mere (paid) support call away, good design has now taken its place at the top table.

With entry level pricing as low as £5/ month, these applications need to be well designed, as 1:1 support interactions of any sort quickly become commercially unsustainable. Unlike older solutions, modern SaaS ones are inherently flexible, with negligible switching costs. Hence the solution better work well, and deliver real value, as competitive offerings are a mere click away. In simple terms, the software has to do what is claimed, and it simply has to be intuitive. Today’s modern user has little time for inferior applications.

As for these applications replacing core functions and putting finance professionals out of a job? If anything, what has been replaced, has been the more mundane elements of finance freeing up finance professionals time such that it can be better spent elsewhere.

“We recognised the need to transform our accounting practise by embracing SaaS early on. The initial time investment was much less than we initially expected, and our clients love the improved service that has resulted. Our business is thriving” Niall O’Driscoll, FCMA, CGMA, Principal OD Accountants, Bethnal Green, London.

In short, the emergence of a much stronger design focus, as well as the increased power consumers have, has ensured that usability is a core driver for all modern software development teams. Given ‘ease of use’ is a basic requirement, and the fact that the cost to evaluate has collapsed with the ubiquity of free trials these solutions tend to deliver. Intense competition, competitively priced business models and negligible switching costs has also helped drive rapid adoption of these solutions. The next step is for finance professionals to embrace applications from the wider ecosystem so as to continue to keep apace with ongoing changes in the external environment.

The Bring Your Own Device (BYOD) Generation

While many of the main accounting software applications are increasingly pushing a host of Add Ons and integrations, the real pressure to consider these solutions is coming from clients and employees. Demand is essentially being driven by the Bring Your Own Device (BYOD) generation i.e. those bringing their own smartphones and tablets to the office. These users are early adopters, embracing new apps and SaaS solutions in greater numbers themselves, that are pulling the wider finance and accountancy profession along. They will determine what they need to run their businesses efficiently, and as finance professionals the onus is on everyone to keep up.

Similarly, for many of those working in the services industry, the modern workplace has been transformed in recent years. Work tools now consist solely of a laptop, smartphone and an internet / Wi-Fi connection. Even our computers have changed. Where once we accessed applications from the hard drive, the majority are now accessed via a browser. Where once our desktops were a sea of icons and folder shortcuts, a clean desktop dominated by a few well known logos e.g. Skype, Firefox, Spotify and Dropbox, has become the norm.

This BYOD generation is not defined by a narrow age demographic like Millennials, but rather spans the entire workforce. In short, it is your client, your employee, and your prospect.

Similarly, the boundaries have blurred in terms of how software is characterised. Many applications span personal and business lives. For most, the days of an IT department dictating hardware and software configurations are a thing of the past. Discovery of new solutions is increasingly peer led via recommendations, rather than controlled exclusively by professional service advisors as was once the case. Of course those working in more regulated industries will remain subject to some constraints for some time yet.

The emergence of a whole raft of great software applications that make people’s lives easier is the key thing here. The explosion of smartphone apps in recent years has shifted people’s perspectives. Downloading apps, and subscribing to ‘software’ services delivered via a browser is now the norm, be that a Netflix subscription, or a Spotify one or even ordering an Uber.

It is thus incumbent upon finance professionals to embrace these wider set of new solutions, beyond just core accounting software applications. Awareness of the benefits resulting from other productivity based applications will become increasingly important as the role of finance becomes more strategic.

Integrating cloud based applications into your current service mix is proving to be the most effective way of both firm and client reaping the benefits. Accounting firms looking to deploy the next generation of software should do so by looking at what best fits their client market, and what adds to their existing service expertise.” Richard Sergeant, Managing Director, Principle Point

“Our research shows 64 per cent of SMBs were using an average of three cloud applications, with 78 per cent indicating they were considering purchasing new solutions soon. This sees the average number of services used set to grow from three to seven over the next three years. With new applications continually coming to market it will be those that help with day-to-day tasks and activities like winning customers, improving productivity and managing finances that will be most popular.” John Davis, Managing Director, BCSG


Similarly, in an increasingly data driven world, entrepreneurs and managers want actionable insights beyond the traditional historic reporting of hard numbers accountants have traditionally reported on.

While various single use applications generate different datasets, viewed holistically they can really help support business decisions and this lies at the heart of the changes we are witnessing. Reporting as part of statutory obligations will no longer take precedent as managers will strive for real time data, and Key Performance Indicators (KPI’s) that help them make better decisions.

Finance professionals who can help provide insights, in addition to their services will be very much in demand. With the explosion in data being generated, the days of this data residing in silos is also coming to an end. Curating this data and leveraging the benefits of the data from the wider ecosystem will be of paramount importance. Change is afoot. It’s life Jim, but not as we know it.

So what are some of the applications you need to be aware of?

Complementary Solutions

The first question that may spring to mind however, is whether one provider offers everything? Historically, providers sought to vertically integrate as much as possible, building additional modules as a means to upsell to existing clients. This of course also suited the users, as this typically meant that they had one familiar interface to use regardless of the cost.

With SaaS or cloud based software however, the landscape is very different. Specialism is the norm, and instead the environment is characterised by companies largely sticking to more narrowly defined sectors. While some providers will offer their own solutions for different categories, they will invariably be poor substitutes to solutions from those focused exclusively on a category.

Instead we have witnessed the emergence of an ecosystem based on

API’s. Examples of constituent categories include:

• CRM e.g. Zoho

• Expense management e.g. Rydoo Expense

• Payment processing e.g. Stripe

• Time Tracking e.g. Toggl

•Travel management e.g Rydoo Travel

“Through the adoption of the correct software, accountancy firms can not just see significant improvements to their own work process but they can also work more effectively with their clients -leading to greater client happiness and retention.” Kevin McCallum, Business Development Director, Freeagent

An Example: The Expense Management Ecosystem

Take expense management as an example. This category has been growing strongly in recent years, in part due to the increased power of smartphones, which have now become so ubiquitous, as well as due to the growing realisation of the ‘time suck’ that expense management is.

The older manual (or even Excel) based approaches are simply no longer fit for purpose. For those wishing to evaluate the hidden costs associated with expense management, mapping the process of receipt through to reimbursement is a painful journey. It is a high touch one, prone to error, and completely inefficient when compared with modern digital solutions.

Availing of smartphones to capture an image of the receipt, which then gets read automatically, transforms the expense management process as we have historically known it. By leveraging the power of the wider ecosystem described above, however, the gains are even more compelling.

Expense Management Integrations

The following represent a flavour of some of the integrations that support the growing ecosystem operating in the wider business productivity / finance space.

• Financial Institutions

Integrations with bank accounts ensure that the days of needing to print out statements, 1 month after the expense occurred and manually reconciling the receipt is consigned to history.

• Payroll

Integrations with payroll ensures that reimbursement is seamless, and that employees no longer need to chase up accounts wondering when they will get their money.

• VAT Reclaim

Integrations with VAT reclaim companies helps companies claim International VAT which most currently lack the incentive to.

• Cloud Based Document Storage

Integrations with document storage solutions like Dropbox help ensure you can safely store receipts in the cloud and upload directly to your expense management tool.

• Cloud Based Accounting Software

However, it is the accounting software integrations that offer most value. Capturing expenses and enabling the data to be pushed directly into your accounting software application removing the need for manual entry.

Alongside these above integrations, is the emergence of e-receipts which are set to become more ubiquitous in the years to come. And as the volumes of transactions mount, the net gains from these integrations can prove considerable, as duplication of effort is removed and time spent on more mundane data entry is freed up.

In short, the world beyond core accounting software is maturing quickly. The number of complementary solutions that integrate seamlessly with these same accounting software applications is exploding. And it is only by understanding some of these core applications, that finance professionals can truly ensure that their service offering is fit for 2016 and beyond.

“VAT recovery opportunities embedded in Expense Management data amounts to huge sums. VAT recovery businesses (such as VAT IT) are able to unlock this potential in a seamless, automated process using the latest API’s. The technology provides visibility into potential recoveries that have previously been missed, and has completely changed the face of the VAT recovery industry on T&E expenses.“ Brendon Silver, Managing Director, VAT IT


As this short paper has attempted to illustrate the adoption of SaaS / cloud based accounting solutions represents a mere starting point for modern finance professionals. The benefits of these accounting solutions are well understood, and as a category it has been growing rapidly. It is also clear that these applications have not replaced the role of those in finance, but they have clearly shifted the focus.

What is also evident, is that users are increasingly keen to embrace the wider ecosystem, particularly when it can save them time. Duplication of effort is no longer tolerated like it once was. Why should I re-input data because the two systems do not talk to each other?

Software producers have recognised the power of these ecosystems, and as a result have for the most part sought to integrate extensively with others via API’s. While accounting software vendors have been aware of the importance of these complementary solutions for some time, it is only recently that these marketplaces have matured enough to warrant further promotion. Accounting SaaS / cloud based providers are all too aware that the relationship is a symbiotic one.

Users of other applications, may limit their selection of accounting software to those who integrate with their own application. It is very much in their interests to ensure the ecosystem is vibrant, and thus explains the growing focus on it.

While entrepreneurs have been quick to embrace a wider set of productivity applications, many finance professionals have not moved beyond the adoption of accounting software. As this paper has attempted to argue, the time is ripe to explore additional complementary solutions, moving finance professionals beyond their immediate comfort zones. It has also sought to shine a light on some of the main categories that warrant further investigation.

The next step is yours!



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