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5 major finance trends businesses can expect this year

Jessica Yun
What does the year ahead have in store? Cyber-attacks, super industry reforms, more robots and artificial intelligence, smarter regulation, and small businesses going digital. <em>(Photo: Getty)</em>
What does the year ahead have in store? Cyber-attacks, super industry reforms, more robots and artificial intelligence, smarter regulation, and small businesses going digital. (Photo: Getty)

Last year was defined by bombshell insights into the banking, finance, insurance and superannuation industry, courtesy of the banking Royal Commission.

And with the final report of the major inquiry due to be handed down at the end of next week, the consequences for the financial services sector is still very much up in the air – and businesses will just have to roll with the punches.

“The reality is that the accounting and finance industry is evolving at a rapid pace,” said Chartered Accountants Australia and New Zealand (CA ANZ) thought leadership and research leader Geraldine Margarey.

“And it’s important that we are agile enough, as both individuals and businesses, to adapt to what’s next.”

Royal Commission aside, these are the five trends in finance identified by CA ANZ that will shape our year:

1. Cyber-attacks aren’t going anywhere

The economic impact of cybercrime is no joke: a 2018 report by cybersecurity firm McAfee puts the price of global cybercrime at US$600 million. Financial institutions are under siege by cyber-attacks all the time, as are entire cities and countries — and small businesses aren’t exempt.

“Experts advise to start preparing as if they will be subject to a cyber-attack, which includes having a plan for recovery to ensure your business is cyber resilient,” Margarey said.

2. The superannuation industry gets a makeover

Superannuation is already dominating headlines in 2019 thanks to the Productivity Commission’s controversial recommendation that the government adopt a ‘best in show’ approach to super funds.

The Royal Commission report and the federal election will also have a hand in shaking up the super sector this year. Underperforming super funds will have to be on the alert, as do corporate watchdogs APRA and ASIC.

3. When, not if: robots and AI

Robotics have already become a part of a number of industries and will continue to impact the aerospace and defence, automotive, banks, luxury/retail, media, support services, technology, telecoms and transport sector.

Indeed these 53 companies have already been identified as stand-out performers that have made the most of the robot and AI revolution.

The accounting industry will also be reaping the rewards this year, with processes to become automated and stacks of paper to disappear.

“These are exciting times for a field that is historically known for its reliance on paperwork,” said Margarey. “But also ensure you reflect on the ethical considerations when integrating AI into their businesses.”

4. Regulation becomes smarter

Digitalising processes and systems will continue to be an important priority for the government, Margarey observed.

“It is likely the government will increase its focus on modernising business registers, facilitating
better exchanging of business information between government entities especially to tackle phoenix operators and improved data analytics to allow the Australian Tax Office to focus on taxpayer segments that were previously considered to be too small, such as small business and individuals.”

5. Small businesses go digital

Attracting new customers is the third-most pressing concern for small business owners, so it’s no wonder that small-medium enterprises (SMEs) will look to establish a digital presence.

“This year, it is likely that more and more SMEs will look to their financial services experts … to help them usher their business into the digital age.”

Experts believe that 2019 will see single-touch payroll be extended to small businesses, while e-invoicing standards will develop in a coordinated way across Australia and our Kiwi neighbours.

Further initiatives are slated to be announced later in the year to encourage small businesses to go online.

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