Blockchain in Accounting: Opportunity or Threat
With the augment of digital accounting solutions, blockchain plays an important role in the form of a distributed ledger technology. It has emerged to provide an upgraded accounting system in the world of digital currency (Bitcoin) and an online payment system.
Blockchain emerged as a concept that got shaped depending on the roles it was dedicated to performing such as:
- a transaction database,
- a decentralized public ledger,
- a technology layer protocol like TCP/IP,
- an information technology
- an asset administration and exchange tools,
- a registry, inventory, listing, and
- And a lot more useful for application in the stock market, banking, and the list goes on….
Blockchain poses as a sequential ledger of bitcoin transactions in a decentralized model. It’s, therefore, like a giant interactive spreadsheet wherein access to and up-gradation can be made by all to create an authentic, unique digital credit. It also focuses on merging the most valuable resources viz. Information, people and things with the help of digitization and convergence.
Hence, with the focus on ‘An internet of Value’, Blockchain innovators exercise to save billions for individuals and companies. They mainly focus on increasing the speed and anonymity of economic transactions, therefore, posing as an opportunity.
However, it might prove to be a huge setback for IRS (Internal Revenue Service), credit card companies, payments processors, legions of accounting and law firms because of the use of protocols in payment options will pave way for removing the limits posted on transaction volume.
With a proposed potential for Blockchain to penetrate digital accounting actions, right from audit to bookkeeping, you, therefore, need to consider certain advantages:
- Easy tracking of assets globally
- Instant, time-saving transactions
- Also, provide automated reconciliation and reporting of transactions
- Enables a compliant, cost-saving verification without a need for a trusted party like courts, banks, tax authorities, and auditors
To know more about Blockchain in Accounting: Opportunity or Threat, Contact Meru Accounting today!