Accounting has a reputation for being boring, but the market is fierce. With the needs of accounting changing as fast as the industries it services, accounting software is bigger than ever. The right tools can enable a department to provide forecasting insight, analytics, and more while staying up to date on tracking and tax compliance.
With the essential nature of this industry, staying current is vital. Because of this, we have compiled a list of the most essential statistics for you to be aware of. We have also covered some of the hottest trends in accounting software and the market as a whole.
Top 15 Accounting Software Statistics
- The accounting software market was valued at $12.01 billion in 2020. (Mordor Intelligence 2020)
- The accounting software market is expected to reach $19.59 billion by 2026. (Mordor Intelligence 2020)
- Only 6% of accountants said they don’t believe automation can help with any business tasks at their firm. (Sage 2020)
- 40% of accountants say they intend to automate invoicing and accounts payable processes and workflows. (Sage 2020)
- 45% of accountants say they intend to automate repetitive, time-consuming accounting tasks, such as data entry and number-crunching. (Sage 2020)
- 58% of accountants said technology has improved efficiency and productivity. (Sage 2020)
- 66% of accounting practices say that increased automation was the first or second most positive outcome of implementing the Making Tax Digital process. (Sage 2020)
- 65% of accountants stated that the automation of processes, workflows and payments were among the first or second most important considerations for accountants in the next five years. (Sage 2020)
- 58% of businesses used accounting software to meet the needs of their clients. (Sage 2020)
- 78% of small companies were using cloud accounting in 2020. (Accountancy Age 2020)
- 30% of small business owners choose to use an accountant. (OnPay 2019)
- 70% of payroll software users are confident about paying employees on time. This is compared to just 43% who are not using such software. (OnPay 2019)
- 50% of payroll software users are confident they do a good job deducting and submitting payroll taxes. Just 25% of those not using the software feel the same. (OnPay 2019)
- 82% of small business owners think their accountant knows their business either well or very well. Another 13% think their accountant’s knowledge of their business is adequate. (OnPay 2019)
- 53% of small business owners strongly agreed that their accountant is a trusted advisor, and another 33% agreed with the description. (OnPay 2019)
Trends for Accounting Software in 2022 and Beyond
SaaS and Cloud-Based Solutions Continue to Rise
It is not long ago that one of the most popular types of accounting software involved buying a physical disk and installing a desktop version onto your PC. This is changing.
The software-as-a-service type of accounting software, especially those that are cloud-hosted, are seeing a bigger and bigger chunk of the market share. A perfect encapsulation of this change is the evolving products of Quickbooks. Several years ago, many were buying physical disks and installing desktop versions of the software. Then, online purchase of the software became more common. This is still popular, but there is a surge in products like Quickbooks Online and similar products that offer cloud-based accounting software.
There are many reasons for this. Convenience is key, and being able to access your accounts from any device anywhere is becoming essential for many businesses. Mobile Apps for iOS and Android are becoming expected rather than a niche. The prevalence of cloud based services are also becoming more common, driving customer expectations. Other benefits include the protection against physical damage. A dropped computer or fire at the workplace won’t destroy all your accounting records if they are on the cloud.
As the accounting market continues to explode, we expect much of the newcomers to this space to be cloud-based software offerings. This trend will likely see the continued depression of the prevalence of physical CD sales.
Accounting Automation Benefits Everyone
70% of businesses have reported a strong ROI when adding automation to their accounting process. Automation as a trend is hardly ground-breaking news. There are few industries and sectors that are not seeing more automation. The accounting software industry is seeing it in unusual ways, however, and in a manner that helps most involved.
In some areas, automation can be seen as a job killer. For accountants, this is likely not the case. Automation instead reduces their time spent on horrifically boring tasks like data entry. Accountants can do the more specialized, less repetitive tasks, and leave the doldrums to the machines. Accounting software is a massive part of what makes this possible.
For those not using it, the dreaded accounting spreadsheet can perform many fantastic functions. Anyone who has seen an Excel wizard at work can attest to this. Accounting software takes this to the next level. Data entry, approval processes, invoicing, form recognition and codification, and much more can be handled by a good accounting software. The info is stored in a more secure, more accessible, and more legible manner. The accountants work is less dull, faster, and more insightful. Everyone wins.
Accounting is Becoming More Than Just Record-Keeping and Math
Your accounting software will do more for you than an accounting department 20 years ago could ever have.
Accounting software are more than simple spreadsheets for recording purchase orders and invoices. The best can provide real-time insights on spending trends, profits, and taxes. The latter is becoming especially relevant, as interwoven industries and complex tax law require faster actionable accounting.
Accounting software will become less about record keeping and reactive reporting. There is a growing emphasis on proactive information, informed, predictive analytics, and tools that can actually suggest areas for improvement
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