A blockchain-esque accounting world! How can blockchain in accountancy be a game changer

With different sectors believed to be on the lookout for blockchain business opportunities, it seems that accounting firms have also picked up the trail. From an accountant’s perspective, blockchain-based smart contracts can process transactions and generate financial reports.

According to OriginStamp, a digital content timestamping service, over 50% of payment infrastructure services have inculcated blockchain to their business operations. Furthermore, predictions have indicated that blockchain will grow global gross domestic product (GDP) by around two billion dollars in 2030. “I believe blockchain can provide certainty when it comes to tracking and making secure transactions, ownership of assets, reducing costs, and maintaining accounts that can help businesses. Transactions can also be immutable so no one can alter what is established. Blockchain is still a developing technology and its adoption in the future in the accounting sector will be beneficial,” Prashant Kumar, founder and CEO, weTrade, a cryptocurrency-based platform, told FE Blockchain.

Industry analysis revealed blockchain-based accounting can help improve efficiency and transparency in global monetary landscape. As stated by Institute of Chartered Accountants in England and Wales (ICAEW), a global chartered accountants corporation, blockchain in accounting can help reduce costs of maintaining and reconciling ledgers, and ensure certainty over the ownership and history of assets. It is believed that blockchain-based data analytics can help benefit external auditing.

“Blockchain can help in money management and managing the transfers happening between parties. I believe blockchain’s creation of a record of transactions allows for the synchronisation of shared transaction information across all locations. By eliminating transaction-level reconciliations, such information supply makes it easier to develop continuous auditing,” Vipin Vindal, CEO, Quarks Technosoft, an information technology (IT) and services provider, stated.

Reportedly, companies such as Xero, Intuit, Wave, Ethereum, Chainalysis, among others, have started to make use of blockchain-based accounting practices. Moreover, future of blockchain-based accounting can help utilise decentralised finance (DeFi) platforms and artificial intelligence (AI) for decision-making and financial planning. Insights from FreshBooks, a software company, governments’ introduction of blockchain-oriented taxation laws indicate that blockchain is to be taken seriously and that blockchain-backed accounting can be impactful in businesses.

“I believe the future of blockchain in accounting looks bright, as the technology has the potential to impact accounting practices by providing a secure, transparent, and immutable record-keeping system. The adoption of blockchain technology in accounting practices can help increase the safety and security of digital assets by enhancing security, improving transparency, and increasing accountability,” Sathvik Vishwanath, co-founder and CEO, Unocoin, a cryptocurrency exchange, highlighted.

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