The accounting profession has evolved over the years with manual bookkeeping being the main accounting approach until the late 90s (in Zimbabwe).
The 2000 era, however, saw a lot of advancements in technology, which replaced manual accounting work. Given the technological headways in the accounting field since the beginning of the new millennium, the questions that have always been raised therefore are:
Will the accounting profession be able to stay relevant despite the automation in data processing? Will the human accountant soon be replaced by the robot accountant?
The fear of the replacement of humans in the work process has not only haunted professional accountants but also professionals in other disciplines.
For instance, online education (Virtual learning) is deemed to replace classroom learning and physical teachers and lecturers; legal software are deemed to reduce the need for lawyers’ advise; and medical software may simply put less reliance on the need to physically see a doctor.
Yet, people in these professions have spent many years investing in their education to become professionals. Can all that hard work be simply replaced by technology?
From a professional point of view, I am inclined to believe that technology will actually make life of a professional better.
Much of what technology does is to improve on efficiency by automating routine tasks, increasing accuracy based on calculated moves of a software and reducing the time required to do a task. This is what every professional out there is looking for to improve on their delivery.
The whole point of financial reporting is to provide relevant, accurate, timeous and reliable information to various users so that they can make relevant decisions.
This process is done in various stages that include capturing data; sorting of the data, commonly known as classification; quantification of the information, commonly known as measurement; presenting the information; and disclosure.
Accountants are also responsible for analysing and interpreting the data in certain context so that it makes sense to the user.
Traditionally, accountants used to spend much of their time on data capturing, sorting of data and reporting.
This process was commonly known as bookkeeping.
The real value of an accountant is, however, not in bookkeeping. Their real value is in analysing and interpreting data to make sense out of it so that a decision can be made.
For example, take a company that wants to restructure and form several subsidiaries that include manufacturing and retailing a particular product while the parent company being the head office.
Traditionally the accountant would worry much about ensuring all the transactions in all three entities have been captured accurately and timeously, the data is classified correctly into sales, expenses, assets, liabilities and equity.
They would spend a lot of their time making complex calculations related to tax and provisioning etcetera.
Although, there is value in all this, it is important to realise that traditionally this required too many hands and took substantial time to do in the paper era and sometimes, the information was not received timeously by decision makers.
This then left little time for the accountant to focus on analysing and interpretation of financial reports to make the decisions that could result in increases in the net asset value of businesses.
In the computer era, all this can now be done faster, leaving ample time for the accountant to focus more on advising the board on areas like; Is restructuring the best solution to the current problem, will it result in an increased Net asset value in future; How can the restructuring exercise be done in a manner that is cost effective (tax planning etc); If the subsidiaries trade between each other, what can be the potential transfer pricing issues from the tax authorities; What would be the impact if a different solution is sort etcetera.
Automation has therefore actually created time for accountants to be of more value to the business.
It is also important to appreciate that the job of an accountant includes making significant judgements. These are often made within the context of the industry, economy, vision and mission of a business.
For example, the Zimbabwean economy is now characterised by a three- tier pricing system. For a company that relies mostly on imports, the accountant has to be on the lookout for best ways to manage relations with international suppliers as payments are highly regulated.
Ways to preserve monetary value have to be explored to avoid deterioration of value whilst at the same time not violating the laws and regulations.
Organisational risks have to be identified and counter mitigation measures have to be explored and implemented.
Most of all this work requires human intervention and cannot be easily automated as it is not routine. The human accountant therefore plays a bigger role in that space.
However, is it possible that technology may completely take over these none routine roles.
When it comes to the future, it is important to know that artificial intelligence, which is a powerful computer system may be able to make decisions that are currently made by humans on non-routine tasks.
Artificial intelligence allows computers to take own decisions, come up with own solutions and can even explain things. I came across this video link which explores how they are creating a robotic personal financial assistant which uses artificial intelligence.
So maybe one day robots can make decisions in future but, by then the profession will have evolved to something bigger and better.
What every accountant needs to know
I think it is obvious that technology plays a big role in our lives. Technology is there to help us perform better and faster, thus we should embrace technology. Financial reporting software can be beneficial to companies as it can help to keep financial records accurate and give timely reminders.
In today’s competitive business environment, a quality financial reporting software has become essential to boost efficiency. The availability of real-time update feature can reduce overall reporting time as well as time spent in revisions etcetera. The biggest mistake is, however, to let technology dictate the business acumen.
This makes us wait for technology and we try to adapt to it, thus we will always follow. Instead, we should define what solutions we want and the right technology to do that is identified or created. Every business has its own vision and technology needs to fit into that vision to improve on delivery.
Define what you want and explore how technology can assist you on delivering the product. Some businesses today are running without any strategic vision because they are trying to fit into technology which maybe not cut for them.
As the business environment becomes more digital, we have to embrace it and make technology a key driver of our objectives. Accountants who have remained stuck to the stock cards of the 90s have found themselves redundant. This can also easily become befall the current generation of accountants if they stick to the existing ways of doing things.
As an accountant, these three questions always keep me awake: In a future of cryptocurrency, how does it change my business for the better? In a future of Block chain technology, how do I get the best out of it to improve my business processes? In a future of artificial intelligence, how does it revolutionise my way of doing business?
The article was written by Webster Sigauke a lecturer at Chartered Accountants Academy, a local education institution specialising in the provision of tuition to student-chartered accountants. Webster is a qualified chartered accountant with the Institute of Chartered Accountants of Zimbabwe (ICAZ). Feedback Email/Phone number: firstname.lastname@example.org/ +263(0242)702532-5