Why Digitizing Business Accounting is Becoming the Order of the Day
Accountants, today, want to move beyond the mind-numbing work of debits and credits and be advisors, partners or coaches to the businesses
For long in India, small and medium enterprises (SME) have always been business driven. Increasing revenue is what drives a startup and small business owner to work every day, slug it out and survive another day of managing clients and operations.
While technology is a boon for their businesses to grow, it’s a bane for business owners. Entrepreneurs who have been out in the field in the daytime have to sit back on the computer and digitize their business accounting overnight in the wake of Goods and Services Tax (GST) and its bookkeeping complexity. Intuit Technologies with their product QuickBooks is changing the way small business owners manage their taxes and also finances by transferring them online, while saving time on shuffling files. Ritu Marya, Editor-in-Chief of Entrepreneur India, caught up with the top leaders of Intuit, as they spoke about how QuickBooks is constantly evolving to suit SMEs’ changing needs and why technology won’t disrupt their businesses but will only make way for more.
Catering to India’s Big Fat SME Family
Catering to roughly 100 million people who have their own businesses, Lucas Watson, Executive Vice-president, Chief Marketing and Sales Officer, Intuit, believes that there are about 12 million people whose businesses are connected to the Internet and have access to the digital tools needed for their products and services. “There are about two million people right now, who are tech-forward and are more likely to be in a service business. They are the early adopters of our product in India,” he says. The global company boasts of branches across the world, catering to SMEs globally. But it’s also important for them to bow down to the needs of the geographical locations of the SMEs they are serving. However, what has helped them map out a success story is that SMEs world over have one core need – to save time, believes Alex Chriss, Senior VP and Chief Product Officer. “No business owner wants to spend their time doing back-office accounting.”. So, they have simplified their platform for these business owners, where 80 per cent of their core platform looks at solving the basic needs of businesses, while the rest varies according to the geographical location, local government regulations, actual needs of the business, relationship with their accountants, etc.
Policy Changes – A Big Push for Technology
Until late last year, Indian SMEs were growing at their own pace, undeterred by the fast technological wave that seemed to be hitting every other sector. However, high tides of demonetization and GST tested their waters. For a bill that took over 10 years to move beyond the walls of the Parliament, the preparation on-ground was one that couldn’t boast of as it took a lot of time. SMEs were hurrying to understand the complex processes that seemed to shroud GST. But, over 1,000 engineers, product developers and designers in Intuit’s Bengaluru office, started researching on GST a year before its implementation. But nothing comes easy. Nikhil Rungta, MD and Country Manager, Intuit India, recalls how they struggled with the constant changes that were rolled out for GST even after its launch. “We had to ensure that we were on top of what’s happening. The less of the technology the customer can see, the better it is.”
Automation and Accountants – Who will Survive?
Manually adhering to the changes in taxation is a difficult task. And here comes in automation to make things faster and better. “We are building a machine learning platform that will help in sales tax calculations and can adapt to the changes that the government is implementing,” adds Chriss. He cites how with over 11,000 different sales tax calculations in the US, the structure there is most challenging in the world. However, the onset of automation doesn’t mean the eradication of accountants. “Accountants, today, want to move beyond the mind-numbing work of debits and credits. They want to be advisors, partners or coaches to the businesses. QuickBooks was built to work with accountants, for accountants and also with business owners to facilitate that relationship,” he says.
Going Beyond the Books and Ease Of Use
Beyond making businesses compliant, Intuit through QuickBooks aims to be the one stop solution for every compliance query of SMEs. This gets further critical as government is trying to ensure tax compliant SMEs Chriss believes there are two ways for them to go ahead with solving the tax crisis. “The first is that we remove the work from them (automate their business). The second essential part is to educate them.” With QuickBooks Capital, they aim to create a data chart that will allow them to recognize creditworthy businesses that are turned down by the banks. “We don’t want to replace banks. This is a global offering albeit we are still getting the approvals for the US,” says Watson. Intuit QuickBooks also goes easy on the small business owners pocket with the accountant cost cut-down significantly. But according to Lucas, the system works only if you want to be an adherent business and want to keep your books clean and be compliant to the system.