What are APIs and why should accountants care

by | Feb 22, 2023 | Accounting

Technology connects the world. APIs facilitate that connection. But “what is an API,” you ask? API stands for Application Programming Interfaces and these platforms create connectivity between applications to increase efficiency, automate tasks, and improve the work environment for accounting practitioners. In this blog, we’re diving into APIs: what they are, why they matter for accounting departments, and why they’re necessary for businesses both large and small. 

APIs are often critical for businesses because they help you manage multiple applications from one area. With an API integration, your marketing applications can connect to your accounting applications. Strategic CFOs can view your sales data in line with your tax information. The list goes on. The point is, API is what binds the technologies of your business together.

At Fully Accountable, we understand the push for data-driven financial decisions. That’s why our fractional team of data analysts and accountants features the latest technology, offering businesses controller and corporate services tailored to your bottom line. We believe you deserve real-time data and real-time reporting that improves your bottom line and cash flow. 

Continue reading to learn more about how we can perform seamless API integration to streamline your business value. 

APIs and Finance and Banking 

Since 2018, intermediaries have been able to process payments directly instead of having to clear with the banks. This process is known as “open banking”. APIs’ ability to access customer details and link computer systems made this possible and changed how transactions process. It allows companies to connect all of their financial processes in one convenient place. 

APIs and Cloud Accounting 

More and more businesses continue to migrate to the cloud, which necessitates cloud computing. With a reputable accounting firm, you can ensure all your synchronized data stays protected. 

Why Are APIs Critical for Accounting?

The reason APIs are critical for accounting is that as a department, accounting uses enormous amounts of data. As well it should, because if you want a full view of the financial picture, you need the corresponding data. APIs pool that data so outsourced accountants or fractional CFOs can perform extensive analysis with the knowledge of real-time information. 

APIs can also automate a substantial portion of the mundanity that comes with accounting tasks, liberating your financial professionals to focus on more complex directives. The benefits afforded to companies can improve customer experience. But they aren’t limited to just that. Perhaps more importantly, APIs lead to improved employee satisfaction and engagement. 

Accounting firms have always struggled to keep their employees lively, and innovative people. After all, accounting isn’t a very glorious profession. However, with APIs, the role of the accountant within an organization shifts. They become the conductor instead of the passenger. They no longer have to arrange the instruments on the stage; instead, they control the entire performance. 

At their root, APIs free accountants to focus on higher-level initiatives. This increased responsibility and freedom corresponds with creative financial strategies that can ultimately improve your bottom line and sustain your cash flow. 

How Do Accounting Firms Leverage APIs?

The ways accounting firms can leverage APIs haven’t been fully discovered. They are seemingly endless. Whether you’re referring to automatic data transfers into tax returns, roll forwards and do batch extensions, there’s seemingly no limit to the possibilities and they will only grow in the future.

However, with this possibility, comes room for error. That’s why your accounting firm should carefully integrate APIs and its features. The first step in doing so, is to catalog all your applications. Once you have this knowledge, you can identify any redundancies, inaccuracies, or tedious administrative tasks that bog down your application infrastructure. 

Once the accounting firm has this information, they can seamlessly integrate your applications and begin analyzing data, reducing inefficiencies, and concocting long-term financial strategies. 

What Are the Benefits of Full Integration?

Time-Efficient

Connecting your applications saves time because accountants don’t have to manually compile data. A single data entry point synchronizes your data in real time and performs continuous monitoring. This leads to faster, more confident decision-making. 

Track Your Inventory

API simplifies inventory management and records your purchases in real-time, automatically updating your inventory and revenue. With APIs, you can easily track your stock and avoid discrepancies that arise from having to manually checking your inventory. 

Accurate Sales Reports

Full integration collects your sales reports with automated processes that display, contacts, summaries of turnover, and the frequency of customer purchases. 

More Visible Financial Metrics

Whether you want access to your profit margin, revenue, or asset management, APIs offer you the ability to study key business data. You can have a full window into your business’s financial health and work with your outsourced accountant to develop a solution or long-term strategy.

Manage Processes

API integration enables financial professionals to analyze your business’s process with unbiased accuracy. These platforms identify any inefficiencies within your operations and streamline the CRM.

Performance Management

Whether you want to input real-time monitoring of your sales team or accurately forecast your potential revenue for the upcoming year, APIs produce accurate, data-supported company objectives. 

Billing Options 

Platforms, such as Quickbooks, offer five invoice templates that are fully customizable. You can change the color, logo, or font as you see fit and set follow-ups with your customers once you see they opened the invoice. 

Tax Management

APIs improves tax management by configuring them so that most of the calculations are performed automatically. Tax declaration should be quick and easy when you have an API as part of  your infrastructure. 

More Sophisticated CRM

With certain APIs, you will be able to generate detailed customer files that simplify the customer interaction process. Enter their first and last name, billing address, shipping address, and other relevant information. You will also be able to identify the payment terms for each customer and customize sheets that relate to each profile. 

Bank Synchronization 

You should be able to connect your bank with most APIs. Most of them have portals that link directly to online banks so you can monitor your transactions via the accounting interface. 

Bottom Line- What Is API Integration?

API integration is one of the most effective ways to streamline your business and ensure all your financial elements operate as they should. Having your financial components run through one location frees you to focus on higher-tiered objectives so you can improve your bottom line and deliver on long-term financial goals. 

Whether you want to save time, simplify your inventory, or monitor performance more closely, API integrations give you the tools to focus on your core business principles and sustainable growth. With an integrated API, you won’t have to worry about the menial tasks or the potential for human error. 

All your data and business directives will be under one roof. It also doesn’t matter the size of your company or the industry you serve. Whether you have an eCommerce or small retail business, automation can eliminate a significant number of headaches. 

At Fully Accountable, our financial professionals are here to ensure you implement the correct software, data analytics, Business Intelligence accounting, and API integration techniques. With our team on your side, you can focus on long-term strategies and identify new opportunities for your business. 

Contact us today to learn more about how API integrations can improve your efficiency and productivity.

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