Digitization of accounting in Hungary: The future-proof solution for businesses

In recent years, the digitization of accounting in Hungary has become an important topic, mirroring global trends towards more efficient and technologically integrated financial management systems. This transformation is driven by a blend of governmental initiatives, market demands, and the intrinsic benefits that digital tools bring to the accounting sector. 

This article explores the rapid digitization of accounting in Hungary, highlighting government initiatives, the benefits of digital tools, challenges faced by businesses, and how solutions like cloud-based platforms and AI are transforming the financial landscape.

The pandemic’s impact on the digitization of accounting in Hungary

The COVID-19 pandemic has significantly accelerated the digitization process. Businesses had to adapt quickly to remote working environments, and digital tools became essential for maintaining operations.  

Governmental initiatives and mandatory digital reporting

The Hungarian government has been proactive in fostering a digital economy, which includes comprehensive reforms in the accounting sector. The implementation of mandatory online invoicing and electronic reporting systems has been pivotal in the digitization of accounting in Hungary.

For instance, since July 1, 2018, the NAV (National Tax and Customs Administration) requires real-time reporting of invoices issued between domestic taxpayers if the VAT amount exceeds 100,000 HUF. This regulation has pushed companies to adopt electronic invoicing systems, ensuring compliance while reducing the administrative burden and enhancing transparency. Today all invoices must be reported to NAV without any exceptions. This means that NAV sees all of the invoices and can provide automatic solutions such as VAT statement offer or other tax statement offer. 

Advantages of digital accounting tools

Businesses in Hungary are increasingly recognizing the advantages of digital accounting solutions. These tools not only streamline processes but also provide robust data analytics capabilities, enabling better decision-making.

Cloud-based accounting software, for example, offers real-time access to financial data, facilitates collaboration, and reduces the risk of data loss through secure backups. Moreover, the integration of artificial intelligence (AI) and machine learning (ML) in these systems can automate routine tasks such as data entry and reconciliation, allowing accountants to focus on more strategic activities. The implementation of systems like Microsoft Dynamics 365 Business Central has allowed companies to leverage the most advanced technology available. This platform supports end-to-end business management and offers real-time insights, facilitating seamless remote work. 

Benefits of the digitization of accounting in Hungary

The shift to digital accounting brings numerous benefits, including improved accuracy and efficiency. Automated systems minimize the risk of human error in data entry and calculations. Additionally, digital records are easier to organize, search, and retrieve compared to traditional paper-based systems. This is particularly beneficial for auditing purposes, where quick access to historical financial data is essential.

With the goal of operating a paperless office, invoices are processed digitally, and the fundamental objective is automation, for which all necessary tools are available. If we can look out to the local or international market of accounting software solutions we can find a lot of platforms and solutions with which we can cover all of the needs, speaking about communication with authorities or processing of accounting data.  

Challenges in the transition to digital accounting

Despite the clear advantages, the transition to digital accounting is not without challenges. Small and medium-sized enterprises (SMEs) in Hungary may face obstacles such as limited financial resources and resistance to change. However, various solutions are available to mitigate these challenges. Government grants and subsidies can alleviate some financial pressures, while comprehensive training programs can ease the transition for employees. Moreover, the long-term cost savings and efficiency gains from adopting digital tools often outweigh the initial investment costs. 

The future of accounting in Hungary

The future of accounting in Hungary is undeniably digital. As technologies continue to evolve, we can expect further advancements in areas such as blockchain, which can provide even greater transparency and security in financial transactions. Additionally, the ongoing development of AI and ML will likely lead to more sophisticated automation and predictive analytics capabilities. 

In conclusion, the digitization of accounting in Hungary represents a significant evolution in the financial sector. While the journey involves overcoming certain challenges, the benefits of enhanced efficiency, accuracy, and compliance are compelling. As businesses and regulatory bodies continue to embrace digital solutions, Hungary’s accounting landscape is poised for continued innovation and growth. 

Streamline your accounting in Hungary with a flexible cloud solution

For businesses looking to fully embrace the benefits of digitized accounting, Accace offers a state-of-the-art online accounting portal as part of our comprehensive services in Hungary. This powerful platform enables businesses to manage their financial operations more efficiently and securely, offering a seamless connection between your company and our accounting experts.

The key features of our online accounting portal are:

• Real-time access: Stay up-to-date with your financial data anytime, anywhere, with 24/7 access to your accounting records.
• Seamless collaboration: Communicate directly with our team of professionals through the portal, ensuring smooth and efficient handling of your accounting needs.
• Data security: Enjoy peace of mind knowing your financial data is protected by the highest levels of encryption and security protocols.
• Automated reporting: Generate tailored financial reports and statements with ease, reducing the time spent on administrative tasks.

With our online accounting portal, you can streamline your accounting processes, reduce administrative burdens, and focus on your core business activities. Combined with our expert advisory and accounting services in Hungary, this innovative tool is designed to help your business thrive in the Hungarian digital accounting landscape. Get in touch today to see how we can get you started.

Péter Licska

Accounting Supervisor | Accace Hungary

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