Financial data is easily one of the prime target for hackers. Knowing the importance of cybersecurity is the first step to safeguarding you data and maintain client trust.

 

We know you deal with very sensitive financial data at all times. And it’s a nightmare for accountants and businesses alike because financial data is a prime target for hackers and data theft attempts. Can you imagine being woken up in the middle of the night that someone had stolen the most precious thing that you value? What would your clients think about you when their sensitive information is out in the open for hackers to abuse? Think about the damage a cyber attack brings to your business and the people relying on you. 

 

Why is Accounting Cybersecurity Vital?

 

While accounting is now simpler to access and handle thanks to the cloud, there are far more security risks now than there were with traditional paper-and-pen bookkeeping. To be clear, hackers and cybercriminals have the ability to target and breach even the most solid IT infrastructures. But what’s much more upsetting and risky is that threats to internal accounting data are even more expensive.

 

Some people believe that the accounting life cycle and data security are unrelated. That is untrue. For instance, in addition to hacking, financial data dangers can also involve mistakes and unintended data breaches, necessitating complex solutions to protect data. Accountants and accounting firms are aware that financial data breaches pose a threat to their livelihood, company expansion, client relationships, and other factors. The account information you use to track debits and credits is also open to malware and other nefarious behaviour.

 

Stolen Accounting Data Can Include:

  • Account numbers
  • Transaction details
  • Credit card numbers
  • Bank accounts
  • Usernames
  • Passwords
  • Personal and private information

 

The largest risk is, most crucially, assuming that your accounting firm or your company’s financial data are safe. Data breaches are becoming more frequent across all sectors of the financial services business.

 

Examples of Accounting Cybersecurity Breaches

 

Sequoia Capital (2021)

Criminals looking to hack financial data frequently target financial companies like Sequoia Capital. In fact, just one data breach can put consumer and company financial data at risk, resulting in huge financial loss. However, this scenario was not as serious as it could have been because just one employee’s email was successfully compromised through a “wire diversion scam.” Sequoia also had to cope with educating clients and prospective investors.

 

Data Breach at Capital One (2019)

This is a perfect illustration of how careless internal accounting procedures can seriously harm a business. 100 million credit card applications were stolen after one of Capital One’s own employees gained unauthorized access to one of the Amazon Web Servers hosting crucial data. As a result, 80,000 bank account numbers and about 140,000 social security information were exposed.

 

What about Small Business Data Breach?

 

You could believe that criminals only desire to breach the financial information of large or enterprise-sized firms. It’s untrue. Small and medium-sized enterprises are also prime targets, but the repercussions can be far worse. 60% of small businesses shut down within six months of a cyberattack, according to an Inc. article.

 

A data breach can have extremely high expenses, even if a corporation doesn’t go out of business. For instance, Gustafson & Co., an accounting firm with offices in Oregon, suffered a significant data breach and was compelled to pay $50K after 1,900 people were made vulnerable.

 

Cyber Security for Accounting Firms: Essential Practices 

 

Your financial information is at risk from both inside and outside of your firm. Therefore, taking charge and avoiding these hazards is not difficult. Putting the right safeguards in place is the first step in stopping or at least minimizing data breaches. There is already proof that businesses may effectively protect themselves with enhanced cybercrime awareness and security expenditure. 

 

You Should Know Your Threats 

As an accountant, you must guard against external dangers like phishing attacks, ransomware, and hacking, but internal dangers like mistakes are just as dangerous. With unskilled workers, accidental data sharing is simple to happen, and there are many ways to lose data that is pertinent to the financial lifecycle. For effective data management, it’s crucial to examine how your particular firm manages data and build accountability into your actual accounting methods.

 

Cybersecurity Training for Your Employees

Data security will become more important as the accounting industry integrates with IT and cloud computing. A crucial requirement is to give financial data a sense of ownership. As an illustration, do this by informing your staff about the risks and threats of financial data breaches, as well as how to avoid ransomware attacks. In a similar vein, maintaining the security of your accounting system is essential for your clients as well as your accounting firm’s and brand’s reputation. 

 

Know and Examine Your Regulations

You may be required to abide by business, state, and federal regulations that address some of your security threats. This is especially true if the federal government has a contract with your accounting firm. These laws safeguard your clients as well as proper accounting practices. Include these requirements in your reporting and accounting standards by documenting them.

 

Design an Approval and Validation System

Ownership must be assumed by your most dependable and knowledgeable supervisors and approvers. Decide which information and activities need to be reviewed and approved by senior managers. This helps safeguard your accounting business from potential errors in addition to ensuring the most knowledgeable and reliable employees have the ultimate say over the use of data. Recall that unintentional data sharing happens frequently, and that internal human error accounts for around 80% of data breaches. Building an approval and validation mechanism ensures that no errors are made that could put your data in danger.

 

Establish Security Requirements

Together with your team, come up with a thorough list of the needs for financial stability by identifying risk factors. Examine your unique process to discover where data slips may occur in addition to taking into consideration particular accounting practices and standards. Internal controls should be taken into account as well as you collaborate. These are crucial in determining what extra features you require from an accounting system.

 

 Choose the Right Accounting System

Choosing the appropriate accounting system is the most important step in accounting cybersecurity. Even the best planned and established financial security standards are useless if you can’t put them into action. Or, if you are required to manually incorporate these safeguards. In actuality, usernames and passwords and other fundamental accounting security features are no longer sufficient. You want a flexible solution with both strong encryption and automated internal security features if you want to protect your accounting system from current cyber threats and ransomware attacks.

 

Keep Your Financial Data Secure with Reliable Accounting Software

 

One of the main purposes of accounting software is to safeguard your financial data in addition to assisting your accounting business in managing and analyzing money more successfully and efficiently. Keep in mind that you are also safeguarding your clients’ personal information and identities in addition to your business. A crucial step in securing the survival of your business is investing in a secure accounting software. Not to mention the security and wellbeing of your clients. But what really makes an accounting system secure?

 

Three Core Areas Financial Data Security Features:

 

Natural Event Defense

Securing data through the cloud and with backups to ensure that data is not exposed or lost due to natural disasters, physical destruction, or malfunction. Make sure your financial data can be kept on the cloud and accessible electronically. The cloud has assisted in the elimination of many of these risks.

 

External Threat Protection

This is your first line of defense against hackers who attempt to access financial data. When connecting your financial data with other apps, it’s crucial to have a robust, secure Application Programming Interface (API). To prevent hackers, a strong IT infrastructure and encryption are also essential.

 

Internal Threat Protection

Your second, stronger layer of security, which guards against both internal and external assaults, is this one. Passwords, permissions, and user hierarchy become a problem if an external danger manages to get past firewalls or encryptions. Although passwords and usernames are fairly common security measures across a range of products, they are insufficient. To build a second line of defense against cyberthreats and safeguard your accounting data from any internal flaws or malicious activities, more comprehensive features are required.

 

Some Core Features to Look for:

 

Using Two-Factor Authentication

You can enable a second level of authentication for each login by using two-factor authentication. A two-factor authentication can also be used while a user is carrying out a particular task, such as reviewing billing reports or approving spending.

 

User Permissions

You can precisely define what actions users can take, approve, and access thanks to user permissions.

 

Approvals

You can automate particular actions or sequences of actions that need to be taken in order to formally certify the accuracy of a record. To make sure that the present process is running smoothly and that the data is accurate and safe, the signoff can be connected to the necessary authority.

 

User Role Hierarchy

You may control which specific users can read or modify particular accounts or data in the system, such as reports, by creating a user hierarchy. Access to opportunities, cases, and connections is controlled by roles.

 

Validation Rules

Standards for data management and recording are established by validation rules. These security measures also make sure that only specific users have access to a particular system function. Validation rules can be established based on business logic to stop processes from being finished out of order.

 

Real-Time Event Monitoring

You may track and monitor common events in almost real-time with the aid of real-time event monitoring.

 

Audit Trail Functionality

To keep correct, up-to-date information, you can track changes made during the financial reconciliation process using an audit trail. Additionally, it enables you to see exactly who is responsible for each task in the general ledger, project accounting, and every other area of accounting.

 

Object/Field Trail Functionality

Users can observe and record changes made to an object or a particular record inside it using the object/field trail capabilities.

 

Workflow Rules

You can design and automate internal processes and procedural stages in essential accounting functions using workflow rules. This establishes the logging, accessing, processing, and usage of data.

 

Secure Email Functions

Emails containing sensitive accounting data should be sent securely and encrypted. 

 

In the realm of finance, trust is the currency that matters most. Clients trust that their sensitive information will be kept safe, away from the clutches of malicious hackers. It’s not just about numbers; it’s about the promises we make to safeguard the dreams and aspirations tied to those numbers.

 

Here at Intelecis, we will make sure that you will keep the trust your clients have for you and your financial data away from cybercriminals. Our goal is to give you that peace of mind knowing your sensitive data is in good hands. We will assess your company to tailor solutions that fit your needs and we have fast and friendly cybersecurity experts who will be available to you 24/7. For world-class cybersecurity for your accounting firm, talk to us today!