Features | From Pivot Magazine

The world moves fast. Here’s how CPAs can stay ahead

How can accountants prosper in an era of technological upheaval? The same way we always have: by staying nimble.

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Businesswoman using graphs on screen in business meetingAs the needs of businesses change, so should our profession. We need to adapt, innovate and even reimagine what it means to be an accountant. (Getty Images/Compassionate Eye Foundation/Robert Daly)

Like most accountants, I began my career at a time when accounting relied on hindsight. I was trained to analyze incomplete, backward-looking financial data and draw conclusions with the underlying assumption that the past was prologue. We took a dispassionate look at the past to make defensible inferences about the future, which helped clients and investors make informed decisions.

Today, however, strategic business choices are driven by foresight, not hindsight, and business leaders care about far more than dollars and cents. They want to ensure the long-term sustainability of their business—looking not only at what happened last fiscal year, but what’s going on now and what might occur in five years.   

As the needs of businesses change, so should our profession. We need to adapt, innovate and even reimagine what it means to be an accountant. CPAs need to see themselves not as keepers of finance but as proactive contributors to the real-time evaluation of value and performance. 

Technological change is forcing CPAs to find new ways to provide value

Fortunately, the profession is already moving in the right direction. A range of stakeholders—including consumers, institutional investors and policymakers—are pressing companies to become more attentive to the ecological impacts of their activities, and accountants have developed methods to measure and report on these factors, gleaning insights from new categories of data. These disclosures aren’t just a flavour-of-the-month focus for activist share­holders; they’re central to risk-management strategies. CPAs’ sustainability evaluations help boards and senior managers understand and prepare for future exposure to regulatory and ecological risk. By properly measuring the environmental impacts of their work (such as emissions or the recycling costs associated with packaging), companies are ensuring the future of their business—and the planet.

Technological change is also forcing CPAs to find new ways to provide value. Blockchain, for example, can record every transaction in real time, rather than a sample after the fact. The catch is that it also jeopardizes the value of an accountant’s skills: why hone the techniques needed to provide a reliable audit when software might be able to do it better and faster? But these new systems will be neither glitch-free nor self-managing. In an era when companies are expected to gather, understand and publicize huge tranches of financial information, the handling and governance of that data will emerge as a vital service. It’s a role that CPAs can fill, so long as we make the effort to figure out exactly what those services are and develop the skills we need to provide them.

I admit it can seem like a daunting task. Over the past several months, a number of late-career accountants have told me how glad they are to be retiring, precisely because it means they’ll never have to grapple with blockchain, artificial intelligence and all the other technologies that will supposedly render conventional accounting obsolete.

This confection of fatalism and pessimism reminds me of another critical turning point in the history of the profession. At the peak of the Industrial Revolution, accountants had to fundamentally reimagine their roles. The double-entry bookkeeping system had served them well for hundreds of years, but when industry boomed and systemic taxation was introduced in the mid-19th century, established accounting methods fell short. It was no longer good enough to simply record the exchange of goods; accountants realized they had to change the way they made their calculations and measure capital and assets, too. Our professional forebears were faced with an existential challenge, and they evolved to meet it.

Historical course corrections like these are a reminder that accounting has never been static. In fact, our current practices are the result of past generations constantly adapting to the disruptive changes of their day, whether it was capitalization in the 1800s or digital spreadsheets in the 1980s. We owe it to future accountants to do the same.

Are you ready to future proof the accounting profession?

Learn more about Foresight: Reimagining the Profession and how technology is reshaping the accounting profession and the services CPAs provide in this free on-demand webinar.

Listen to senior leaders as they weigh in on how the Canadian accounting professionshould respond to significant issues impacting business, how changes are affecting the profession in Canada and around the world, and how you can get involved with Foresight’s two workstreams: Data Governance and Value Creation.