What Is Accounting Research? (With Tips)

By Indeed Editorial Team

Published September 29, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Accounting is an important profession that involves many duties and responsibilities. For example, accountants may perform accounting research that helps them learn more about how a company operates and where its money goes. Understanding this process may improve your accounting career by allowing you to have better insight into your client's financial records.

In this article, we define accounting research, discuss how you can perform it, highlight a few important areas you may research and provide a few tips that may improve your accounting research process.

What is accounting research?

Accounting research is any research and development that an accountant or accounting professional may perform before helping companies make financial decisions. This research examines things like cash flow, economic performances, sales success, marketing development, operating costs, payroll expenses and business taxes.

Accountants then use this information when helping clients make financial decisions for their firm. They do this by:

  • Creating reports: After performing accounting research, financial and accounting professionals create reports for their clients. These reports include all data related to their research, including cash flow improvements and payroll increases.

  • Producing charts: Accountants may pair their reports with various charts detailing financial elements like increasing profits, decreasing expenses and changes in a company's stock portfolio. These reports simplify their findings and make them easier to track.

  • Identifying improvement areas: Skilled accountants may provide expert opinions on their findings, including strong performance areas and recommendations on what businesses can do to improve their bottom line. This advice may include steps like expanding to a new market or introducing a new product.

Proper accounting research helps give companies a better understanding of their financial transactions. Accountants can discuss things like market changes that influence a business' operating capital and new taxes that affect their payroll. By explaining these factors, accountants help their clients make skilled accounting decisions to improve their operations.

Companies may hire research accountants when expanding their operating range or when updating their overall accounting procedures and need a one-time analysis. Others may ask their current accountants to conduct research as part of their day-to-day duties.

Related: Accounting: Definition and Specializations

How do you do accounting research?

Accountants doing accounting research use networking, communication, organization, time management, creative thinking and problem-solving skills to direct their research and identify financial and economic trends. Performing this research includes a few steps, including:

1. Identifying your research field

Decide which accounting field to start with before you begin to more easily direct your search. These fields may include things like current accounting methods, updated accounting options, a business' cash flow direction and a company's financial goals.

You can research one or multiple fields during your studies and use information from these sources to track your company's finances and figure out more information about their economic needs. Companies often have complex financial records that accountants may skillfully track to their sources to enhance their understanding of the business' financials.

2. Choosing your accounting research technology

Accountants may research manually using things like laptops, smartphones and physical records and files. Manual research provides accountants with a more hands-on research method that helps them track information to specific paper sources.

Other accountants may update their research methods to include various cloud-based storage systems, integrated accounting software options, tax-law databases and automated data processing tools to speed up their early research methods. Doing so lets them focus more on data analysis by minimizing data gathering time and maximizing their raw data numbers.

3. Using AI searches in accounting databases

Identify artificial intelligence (AI) programs that track financial information and that can improve your data collection process. These programs follow all legal rules and guidelines created by state and federal tax laws, including confidentiality. They let you create searches for specific information types.

For example, they can track salary information through the years to help your employer choose an appropriate yearly wage increase for employees. AI quickly gathers this information and sorts it for you, depending on the parameters you set for it. This raw data collection improves your research by giving you more numbers to work with.

4. Gathering and understanding financial data

As you gather financial information for your employer, you may notice that patterns emerge. These may include instances of specific surges in income followed by heavy spending.

You may also find accounting methods that worked well in the past and make improvements for them to enhance your company's economical skills even further. Track these trends as you research and identify any positives and negatives that may emerge. Doing so should help you draw several conclusions regarding your company's financial health.

5. Drawing conclusions based on data

After gathering as much information as you need and looking for patterns and trends, you can start drawing financial conclusions from the data. These conclusions may help your employer identify better investment opportunities to improve their financial strength.

For example, you may see that your employer always spends a specific percentage on SEO processes and that the business' income increases with each new investment. As a result, you may find that SEO marketing works particularly well for your company.

6. Presenting your findings to your client or company

Presenting your financial findings and conclusions to your employer lets you make a difference in the company's financial health. For example, you can create detailed, but easy-to-understand, reports that highlight the positives and negatives you discovered.

Draw up charts and various fine-tuned graphs that help your company's managers, owners and executives better understand the conclusions you reached. You can answer their questions using your data. In this way, you help your team better understand what you found in your research.

Related: Financial Accounting vs. Managerial Accounting: 6 Differences

Important research areas in accounting

Accountants may research many important fields, including:

Accounting Information Systems

Accounting research may help you examine a company's accounting information systems (AIS) and gauge their overall efficiency. Research accountants may check all systems related to collecting, storing and generating accounting information and determine how well they operate.

Accountants may then help companies decide when to upgrade these systems or what new software they may want to purchase. Some may even help train a company's accounting team to use this software based on their research. For example, they may identify the employees who best understand this software and ask them to focus on using it.

Auditing

Accountants may also research business audits or all topics related to audits. For example, they may examine auditor independence and their credibility by examining past audits and their success. They may also rate an auditor's decision-making and data collection skills, helping improve this overall process for future audits.

Accountants may also research what reporting methods auditors use when detailing their findings to tax officials. Companies can use this audit-related information when deciding which auditors to hire or when to do an audit.

Financial

Researching a company's financial approach helps provide insights into its overall operation. For example, accountants can figure out how companies make financial decisions and what information they favor when deciding.

Accountants may also track a company's cash flow and see where their money comes and goes. This information helps companies better understand their current economic health and helps them make better decisions.

Managerial

Researching a company's accounting management may provide many insights into how their team operates. For example, accountants may evaluate resource allocation in an accounting department, their budget quality, decision-making processes, performance incentive quality and advancement opportunities for entry-level employees.

Identifying these factors helps companies better understand how well they treat their accountants and showcase how better treatment may improve accounting accuracy. For example, accounting research may help companies create better compensation packages for their entry-level accountants.

Other Topical Areas

Accountants may also examine many other research fields, including taxes, financial education, current methodologies, accounting psychology and accounting history. Some may also examine accounting laws and how these affected the field, while others may research the common work environment for accountants.

This data may help accountants and their businesses make better financial decisions. For example, they may identify workplace improvements, like standing desks and cloud-based data storage, that help accountants better handle their duties.

Related: Learning About Basic Accounting Concepts

Tips for accounting research

Before starting any accounting research, consider these simple tips:

  • Understand important keywords for search engines: When using accounting research websites, make sure you understand which keywords you want to use. Narrow down your search as much as possible using keywords like "accountant compensation in" or "financial transactions in April 2016."

  • Know what information you want: Focus heavily on what kind of data you need and collect only information related to your research. Focused research makes data processing easier when focusing on long-term processes.

  • Trust peer-reviewed sources: When using the internet for research, use terms like ".gov" in your searches or click on "Research" tabs to identify peer-researched information. This outside information helps provide reliable data based on scientific research methods and information you can use when analyzing your company's accounting.

  • Store all information digitally: Storing your accounting information digitally, as well as on paper, helps make it easier to find later. For example, you can create digital storage databases and label each file and search the file name later to find it more quickly when analyzing your info before preparing reports.

These simple tips may improve accounting research by focusing your search on information related to your field. Don't forget to talk to your state and federal tax professionals to learn more about any tax-related accounting research data you may need.

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