Businessperson making presentation to colleagues in board room

CPAs have a key role to play in the adoption of ISO 20022

With Canada-wide implementation around the corner, experts share the opportunities and challenges organizations could face in the transition

Businessperson making presentation to colleagues in board roomCPAs can guide and advise clients about the impact of IS0 20022 on organizations’ financial processes (Getty Images/JohnnyGreig)

There has been much talk in recent months around the adoption of the ISO 20022 financial messaging standard in Canada. Payments Canada is working to introduce the standard to Lynx, Canada’s high-value payment system, in March 2023. This move will set the foundation for payments innovation to take place in Canada over the coming years.

“There are plenty of reasons why CPAs should care about ISO 20022,” says Todd Roberts, national payments practice leader at Deloitte Canada. “If you are a CPA, it can help your clients have better control, gain a deeper understanding of business processes, and find greater efficiencies in terms of managing payroll and account reconciliation and auditing functions.”


ISO 20022 is a financial messaging standard that uses a common language across international and domestic payment networks, explains Judy Li, director, information, data analytics and ISO at Payments Canada.

“ISO 20022 provides a structure and data-rich language standard that aims to replace all those languages and enable interoperability. ISO dictates that all the individual data elements in a message are structured in the same way so when people get the message, they know exactly what it means.”

An independent international standard is key to delivering a seamless and frictionless experience, says Li. “Rather than having to go in and fix translation errors, ISO makes it all more efficient and cost effective, and delivers a better experience for everyone.”

And this is especially pertinent for CPAs. “Accounts receivable, accounts payable, supply chain management and cash flow forecasting are all prime topic areas for accountants, as they all require data,” adds Roberts. “Sending electronic payments also means you don’t need to hold money waiting for cheques to clear.”

It can do this because the ISO 20022 schema is machine readable allowing for software to do a job that is typically done manually.

Li likens the standard to addressing an envelope. “There is a certain format that you must use for the name, street, and country. Imagine the chaos if, for example, Cuba Street in Ottawa was written out of sequence.”


ISO 20022 will become a de facto standard for payment interchange, with 70-plus countries in various stages of adoption.

SWIFT for CBPR+ (Cross-Border Payments and Reporting Plus) originally scheduled their mandate for November 2022, but has shifted that to March 2023,” says Raveesh Khosa, director, Deloitte, who has been working with Canadian banks on modernizing payment infrastructure. “Interac e-Transfer for Business is also enabled for ISO.”

“The major banks already have a high degree of readiness,” says Roberts. The gap is really with corporations setting up to change processes at work, such as sending and receiving invoices electronically using the standard. Some early movers, particularly global companies, are already using ISO. Others will be prioritizing it over the next one to two years.”

The transition will take time for many, says Li. “Some banks have already migrated. There will be a period of co-existence for a few years that will happen industry wide.”


CPAs have an important role to play as catalysts for the ISO adoption, says Roberts.

“Clients don’t get up at the beginning of every day thinking about ISO,” he says. “They are thinking about managing their supply chain or cash flow. CPAs, however, need to understand that standards like ISO are a critical foundation for things they regularly advise their clients on when modernizing their processes. They need to make sure their organization is aware of how it can be useful for them, starting with a critical look at payables, receivables, and treasury management, taking into account the functions that matter most to their clients.”

“Promoting knowledge of what ISO 20022 can do for a corporation would be a good start,” says Li. “Look to other jurisdictions to see what ISO has done and talk to vendors and banks that you work with to help you support your strategy.”

CPAs managing the ISO 20022 migration will be tasked with reviewing funding allocations, system upgrade and data transformation requirements, staffing needs, and underlying value, in addition to monitoring and reporting.


When considering the transition, Khosa says the underlying value can only be determined on a specific use case basis. “The company would need to figure out the benefits of electronic payment in terms of the customer experience, the processing costs and operational optimization when building out a business case for investing in the required infrastructure.”

He offers the example of a large insurer where more than 50 per cent of claim payments are by cheque. “Not only do they take up to two weeks to deliver; they must lock in liquidity to cover uncleared cheques. Processing can cost $10 or more per cheque. A company can have upwards of 100 resources dedicated to reconciling claim payments to finance and ERP systems, a process that can easily be automated using ISO 20022 leveraging existing schemes (e.g., Interac e-Transfer for Business in Canada).

Khosa notes the companies that are slow to make the transition could run the risk of losing contracts with customers they supply. “Larger companies will expect to be able to get ISO 20022 data. If a supplier can’t connect electronically and share information, it will become a barrier to their ability to work with them.”


Learn how new forms of digital payments will change the way we do business. Plus, check out our small and medium businesses resources for tips to help you better manage your organization’s finances.