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When we usually think about the application of augmented reality (AR), gaming and entertainment industry instantly and prominently comes to our mind. While AR’s overwhelming presence in the gaming and entertainment industries cannot be disputed, it is fallacious to think that this technology cannot be used in other fields and industries.
After all, AR is multifaceted and can be productively used in diverse fields including analytically driven fields like accounting and auditing. Yes, using augmented reality in accounting can not only be feasible but immensely fruitful and value-driven decision.
In fact, you’ll be quite surprised to know that a few companies are already leveraging the augmented reality in accounting for simplifying their accounting work. Although its usage is currently minuscule and far from becoming a mainstream practice, its impact is promising and a potential game changer for the accounting field.
Below we have highlighted how this futuristic technology can redefine the accounting and auditing field.
Improved data visualization:
As many of you may already, AR technology thrives by imposing digital information on the real world, which essentially paves way for enhanced data visualization. This can dispel the mundanity that is generally associated with the accounting work. You and your clients can see complex and boring financial figures in a rich 3D visual, making financial metrics easier to understand and facilitating informed decision making.
Proficient data management:
AR can fix the repetitive task of searching important documents and folders, which can rather be painful and tasking. Through its rich visualization, it can visually guide you through documents and folders. This will eventually streamline the document retrieval process, which can be a great time saver.
Improving auditing and compliance:
One of the reasons accounting is immensely taxing is because it involves analyzing vast amount of data, which is not only cumbersome but also time consuming. Above all, the activity is very much prone to costly human error and mistakes. However, as and when AR becomes a mainstream technology, it can prove to be a great boon on this front.
Auditors and accountants can use AR-enabled smart glasses to scan financial statements and accounts to receive valuable insights in real time. This can help in detecting discrepancies and inconsistencies in accounts, facilitating not only quicker but also accurate decision making. Additionally, it can also help in greatly reducing the manual effort.
Efficiency in accounting process:
Augmented reality in accounting can help in removing great degree of inefficiency. This can especially happen when AR and artificial intelligence (AI) technologies are leveraged simultaneously. Both these futuristic technologies can combine to automate several important and repetitive accounting tasks like bookkeeping, invoicing, reconciliation and tax preparation. Automating these repetitive tasks can help in removing bottlenecks in your productivity and efficiency.
Bringing clarity to non-financial professionals:
Analyzing spreadsheet and numbers can be bit scary and overwhelming especially for layman people like amateurs and non-professionals. This could include your clients or you yourself as a business owner. However, AR with its interactive and visually engaging data (like 3D charts and graphs) as well as storytelling can greatly simplify accounts and numbers for such people.
This can not only help in bringing inclusivity and democratizing accounting and auditing but also improving the communication gap between you and your client.
Detecting fraud:
Today accounting fraud has become too common and pervasive, demanding a judicious and discerning attitude from accountants and auditors. In distant future, AR enabled glasses can be of great help on this front.
As mentioned above, AR enabled smart glasses can become ubiquitous in the ensuing decades. If tech experts are to be believed, these hi-tech smart glasses can audit financial statements and balance sheets in real time and spot any possibility of scam or inconsistencies.
Although this is hypothetical, AR’s potential in superseding our expectation as a fraud detection tool cannot be denied.
Potential game changer for customer service:
AR can help financial companies like banks and other consumer oriented financial services in bringing vast improvement in their customer service. For instance, they can integrate AR’s enhanced data visualization into their apps to help customers in locating their ATMs. Or else, financial companies can capitalize the AR technology’s immersive experience to help customers in registering their complaints and grievances in an interactive and engaging way.
Challenges in Using Augmented Reality in Accounting and Auditing
While it is all justified to feel excited about the positive impact and changes that AR technology can bring forth in the accounting field, this possibility comes with its share of challenges and downsides.
These challenges have been duly discussed in the below points.
Costly Investment:
Futuristic technologies like AR and VR are essentially costly technologies. Investing in them invariably incurs upfront cost, with significant investment going to hardware and software purposes. While big companies can easily bear this cost, smaller companies may find it unfeasible to bear this cost.
Technical constrain:
Although the future of AR no doubt looks promising, today it is still in a nascent stag. AS a result, companies can face lot of technical limitation while trying to leverage this technology. Many experts also believe that AR could have a long gestation before it matures as a technology, which puts companies that are trying to exploit this technology in a great disadvantage.
Data privacy concerns:
AR software or applications having unconstrained access to financial data can raise alarming concerns about data privacy or data breach by hackers. Therefore, some clients and customers can have reservations about using this technology. To address this concern, companies may have beef up the cybersecurity and data privacy protocol, which could incur additional cost for the companies.
It is also important to note here that AR technology is more reliant on data than social media platforms, which only reaffirms that
Regulatory compliance:
Finance and accounting are highly regulatory field. Auditors and accounting companies, therefore, will have to be mindful that AR tools adhere to all the rules and regulations imposed by the accounting industry or the concerned regulatory body.
AR software and tools for accounting
As mentioned earlier that AR technology is still in nascent stage and, therefore, there is still no standalone AR app or software that is solely dedicated for accounting and auditing. However, there are several accounting apps and software that have integrated AR features to offer data visualization and collaboration among other features.
Conclusion:
The sheer excitement of imagining a world where financial data pops up from your screen and morphs into engaging and interactive dashboard is bit overwhelming. This single fact offers a peek into the potential of augmented reality technology. While skeptics may argue that these are hypothetical assumptions, the underlying potential of technologies like AR and VR cannot be undermined.
As these futuristic technologies rapidly evolve in the ensuing years, we can be more than hopeful that it will transform accounting from spreadsheet and paper based into truly immersive and visually interactive field.
