Traditional and alternative markets alike have been struggling in the face of red-hot inflation and ensuing rate hikes, with businesses and consumers alike feeling the squeeze. The S&P 500 is in a bear market, cryptocurrencies have wiped out trillions in value, and analysts warn that we're still in a "super bubble" that's ready to pop.
In the midst of all this economic turmoil, businesses are looking for ways to cut costs and protect their bottom lines. One way they're doing this is by turning to blockchain accounting. Traditional accounting can be slow, costly, and vulnerable to errors. In addition to the sunk cost of ongoing maintenance, businesses must also contend with potential fines for inaccurate reporting, the consequences of fraudulent activity, and the opportunity cost of time spent on compliance.
With blockchain accounting, businesses can avoid these costly mistakes. Blockchain is an immutable ledger, meaning that once data is entered it cannot be changed or deleted. This provides a permanent record of transactions that can be easily audited.
Protection from invoice fraud
Invoice fraud is a serious problem for businesses. In 2018 alone, businesses lost $12 billion to invoice fraud, and the problem is only getting worse. With blockchain accounting, businesses can verify the identity of vendors and the authenticity of invoices before payment. This not only protects businesses from fraud, but also helps them avoid late payments and penalties.
With NFTs, or "non-fungible tokens", businesses can also track the ownership and provenance of assets. This is important not only for compliance purposes, but also for preventing fraud and theft. For example, if a business receives an invoice for an asset that it doesn't own, it can quickly check the blockchain to see if the invoice is legitimate.
In addition to protecting businesses from fraud, blockchain accounting can also help them improve compliance. The transparency of the blockchain means that businesses can easily track and audit their transactions. This can help businesses avoid potential fines for inaccurate reporting, and also makes it easier to meet regulatory requirements.
Recently, KMPG was fined over £14 million for providing false information about audits. Another "big 4" firm, PwC, received a nearly £2 million fine for failing to identify fraud. That was in August, and two months earlier, PwC received penalties totaling £5 million for other auditing failures.
Clearly, there are serious consequences for businesses that fail to comply with regulations. With blockchain accounting, businesses can more easily meet their compliance obligations, and avoid the costly fines associated with non-compliance.
In addition to the cost savings from avoiding fraud and compliance mistakes, blockchain accounting can also help businesses save money on operational costs.
The automation of blockchain accounting can reduce the need for manual entry, which can save businesses time and money. In addition, blockchain accounting can help businesses streamline their operations by eliminating the need for multiple ledgers and reconciling between different systems.
Traditional accounting systems are vulnerable to hacks, malware, and data breaches. In 2017, the Equifax breach exposed the personal information of over 145 million people. And in 2018, a malicious software called "NotPetya" cost Maersk $300 million.
With blockchain accounting, businesses can avoid these costly mistakes. Blockchain is a secure and decentralized platform that is resistant to hacks and data breaches. In addition, with blockchain accounting, businesses can easily track and audit their transactions. This provides enhanced security and peace of mind for businesses.
Improved cash flow management
Another advantage of blockchain accounting is that it can help businesses improve their cash flow management. With blockchain, businesses can track their invoices and payments in real-time. This information can be used to optimize payment schedules, and avoid late payments and penalties.
In addition, blockchain accounting can help businesses manage their inventory more efficiently. By tracking the ownership and provenance of assets on the blockchain, businesses can better manage their stock levels and avoid overstocking or understocking.
Get Started With Bulla Network
If you're looking for a blockchain accounting solution that can help your business save money and improve efficiency, Bulla Network is a great option. Our platform is designed to help businesses streamline their operations and reduce costs.
Join our Discord to chat with our team and learn more about how we can help your business.