The accounting profession is currently going through a transformative phase that will continue for the next three decades and result in a lot of significant changes in the field of accounting and finance. It will become imperative for the global professional accounting bodies like ACCA, ICAEW, etc to respond accordingly to these changes because the changing environment will result in a change in the accounting and auditing standards and the reporting rules and regulations. Those who are aware know that there is already a movement to introduce integrated reporting that will change the way we look at reporting.
In order to simplify the situation, we can limit down the change drivers to three. The changes brought about by smart and digital technology, globalization and harmonization of accounting/reporting/disclosure standards and new regulations.
It is expected that as we enter into the next decade, technology is going to progress leaps and bounds and it will become further integrated with business and thus accountants are going to increasingly be in contact with new and cutting edge technologies. This means that accountants will now have to be innovative and adaptable more than ever. They will need to remember their training and skills and use them in situations that they may not have been trained for.
The increasing usage of technology is also going to change the traditional role of accounts. If we look at the increasing usage of artificial technology then we can foresee that in the not so distant future, artificial intelligence is going to replace most of the roles of traditional accountants like bookkeeping, invoicing, reconciliation, etc. This does not mean that the accountants in the future will go out of jobs, no. Instead, this means that their role will change and they will take on a more interpretative and decision making role. Accountants in the future will need to work with the output of artificial intelligence. All the data collected by AI systems will need to be analyzed and this is where the expertise of future accountants will be. But this evidently means that accountants in the future will need to have IT skills as well.
What we can see is that in future the role of accountants will merge with the role of data specialists, or loosely speaking IT engineers. Even today we can see that IT specialists are employed for data mining and cloud computing applications. As time passes and these technologies become more sophisticated, companies are going to value those professional accounts more who also have IT skills because an accountant in the future will be surrounded with technology and data and he will need to have the relevant skills to make sense of all the data for the decision making process.
Another change that we can see is that as technologies become sophisticated, especially with the rollout of 5G, the way we look at workspace will change. Already outsourcing has become a major thing. Shenzen in China Is the hub of outsourcing for fresh entrepreneurs because it provides startups with economies of scale and scope. The cost of setting up production in Shenzen is many times less than that of doing the same in any other place. This trend will continue and outsourcing will become a major mode of running the business.
The onset of freelancing platforms is an indicator of the future. Websites like Upwork and Fiverr allow professional accountants to render their services online to clients worldwide. Imagine that a professional accountant living in South Asia today is providing financial services to businesses in Europe, America, Australia, etc. Why? Firstly this is very cost-effective and secondly, this reduces the burden from the businesses to maintain a separate accounting department, thus leaving more time for the owners of the business to focus on core activities. With 5G, real-time communication will become much easier and thus it is expected to further spurt the growth of outsourcing.
In addition to this, those professional accountants who are in a managerial role will see changes in the way they deal with stakeholders. The widespread usage of social media has allowed stakeholders to be continuously in touch with the companies and vice versa and managing stakeholder relations is today more important than ever because you never know when someone may post their negative experience about your business or organization. While this has kept many managers on tiptoe, it has also presented an opportunity for many organizations to work more closely with their stakeholders.
Furthermore, data mining as mentioned before is becoming an important part. Every day a huge quantity of data is generated by social media sites regarding the behavior and preference of millions of users. Organizations are interested in this data because this data gives them understanding and insight into the thinking and behavior patterns of their consumers. At the same time, this has created some negative headlines as well, as Facebook recently came under fire from the US Congress for breaching user privacy and using targeted ads to change behavior or engineer consent.
This relates to the ethical and fair usage of data available, this currently is a grey area and a lot of discourse is taking place in the world to determine the ethical value of such data if it is gained without the consent of the user or consumer. This debate has not been finalized yet, but as you can imagine this will have an impact on compliance, regulations and ethical standards of global accounting bodies in the time to come.
This paints a picture of a future that is evolving and ever-changing and accountants today, whether they are professionally qualified or students, have to bear in mind that their profession is going to be significantly affected by the technological changes that are occurring in this world and so they will have to be innovative and will need to diversify their skill set in order to adapt to the changing circumstance.