Technology has infiltrated our lives under the guise that it will make life easier. No one really wants to write journal entries or do math by hand, so, it seems like an excellent idea to ditch our old processes and find an app for whatever it is we need to do.
The problem? We made it all ridiculously complicated. It’s been over a year since I addressed digital ecosystems and in that time, complexity has only increased — even for simple tasks.
And, of course, accountants often need to keep a company’s digital ecosystem spider web untangled, especially if the app deals with accounting jargon in any capacity. IT is clueless.
So, what do we do? (Besides get an aspirin to prevent an inevitable headache.)
APIs run the world
How about we start with application programming interfaces (“APIs”)? APIs are the “hidden backbone of our modern world which allow software programs to communicate with one another.” It can’t hurt to get acquainted.
Every company’s digital ecosystem has lots and lots of APIs. But, the accountant’s job is to keep their eyes open for outputs that don’t match the underlying data. For example, if an amount in your payroll system doesn’t match the journal entry in the ledger application, it doesn’t take a rocket scientist to deduce that you may have an interface error, even if the import was 100% automated. Don’t be the accountant that’s too lazy to notice or fix it. Auditors love to sniff this stuff out with their interface testing for Sarbanes-Oxley 404 compliance.
Digital ecosystems’ abysses
But, there’s more to it. What happens when you get all these neat tools, and they don’t talk (i.e., there’s no API yet)? It’s miserable.
A recent Wired article talked about this when it comes to creating a “smart house” that interacts seamlessly. Andy Rubin, Android inventor, sees opportunity in the fact that our current era of the internet of things (IoT) is disjointed. He’s quoted:
All the pieces were available, but “they were all by different companies,” Rubin says. “And there was no [user interface]. It’s not turnkey.”
This can be extrapolated to business. And, boy, is it super frustrating when your laptop stops connecting to the internet, let alone anything more complicated stops interfacing correctly.
Top of the line ERM systems like Oracle and SAP try to keep it all in one spot, but you’d be hard pressed to find a company without at least one outlying system that has to interface with the ERM system. For instance, imagine you use a property management system (e.g., Yardi) to keep track of multi-family residential billing and receipts. At some point each month, all of the data from the property management system gets dumped into the ERM. And it’s common to see a semi-manual export/import process with an Excel spreadsheet as an intermediate step between the two systems. What could go wrong?
Cortana and Alexa are new BFFs
It’s just going to keep getting messier unless companies can agree to work together more. And, maybe, that will happen more. We can only hope!
This week, Microsoft and Amazon struck a deal to let their digital assistants talk and it’s a step in the right direction. The Wall Street Journal reported this week:
Right now, Alexa is lacking in some aspects such as email and calendar options, which it gains through the partnership…
Yes, connecting Alexa to Outlook would be handy. In case accountants weren’t already workaholics, we could send emails while cleaning the house and cooking dinner.
But, it will be a while until information bounces around seamlessly. Even with better and more universal APIs, accountants better keep an eye out for this stuff. No records can be 100% accurate if the output doesn’t match the original input due to an interface error. Imagine if your payroll system doesn’t talk to your HR system, and there is no API. You resort to a manual import and the wrong number of personal allowances gets imported into the payroll (maybe it’s off by a row or two). Then you’re deducting the wrong amount from employees’ paychecks every month. Even if someone looked at the final report from the payroll system, they wouldn’t know there’s a discrepancy. Then the first employee complains about their pay being wrong and your world blows up.
So, moral of the story, interfaces are going to keep getting messier and there will be more opportunities to screw up. Until all IT people learn accounting.