The accounting profession is undergoing a major digital transformation. As firms integrate AI in accounting and automation into their workflows, repetitive tasks like manual data entry and compliance reporting are being streamlined. But this doesn’t mean accountants are being replaced by technology. Instead, their roles are shifting toward interpreting data, offering business insights and providing informed decisions.
Today, digital literacy in accounting is just as important as traditional number crunching. The ability to work with accounting software, analyse data, and leverage digital tools is becoming a core skill for accountants who want to stay competitive.
One of the biggest drivers of this change is Making Tax Digital (MTD). This UK initiative requires small businesses to keep digital records and submit tax returns online. While it will bring efficiency in the long run, the transition can feel overwhelming, especially in the first year when quarterly MTD submissions overlap with the annual self-assessment period.
However, adoption rates show there is still progress to be made. According to Xero’s Accounting and Bookkeeping Industry Report:
Only 49% of small businesses currently use accounting software.
Just 59% of bookkeeping services are cloud-based.
Only 40% of clients benefit from connected bank feeds.
These figures highlight the need for cloud bookkeeping and wider digital adoption. By embracing technology, accountants can automate manual tasks, save time, ensure MTD compliance and deliver higher-value advisory services.