A computer can do your job. A computer could do my job. It’s still on the edge of understanding, but there are plenty of people working on making machines that can replace us. Accounting is a profession that, on the surface, seems easily replaceable. The days of envelope accounting are gone, and they’ve been replaced by silicon accounting.
As we trend toward more and smarter accounting software, what can we do to protect the future of accounting firms?
What does the future of accounting hold?
First, let’s try to understand what kind of change is coming. In 2011, Inuit imagined 2020 as a sort of upbeat accounting dystopia – if that makes sense. In it, much of what makes up an accountant’s day-to-day activity is taken over by automation, yet the accountant is still working constantly. He thinks, “It’s not that I work fewer hours in a year … [but] I have so much more flexibility around where, when and how I do my work.”
Intuit’s world is one where many of the data-entry and low-value jobs are replaced by automation. The world allows accountants to focus in on specialties like international tax or tax fraud.
The CPA Journal reflected a more practical view in its panel on the future of the profession. Panelists saw accounting as being the overlooked science, one which business owners thought they could replicate through software. In reality, accountants can give advice in a way that no software ever could, by examining the goals and nuances of businesses.
In the same piece, former FASB Chairperson Leslie Seidman said being a good accountant required developing soft skills in addition to technical ones. To succeed in the future, she said, “[Accountants] must have intellectual curiosity and a willingness to learn and embrace change.”
In short, everyone sees the landscape being changed by technological adoption, but few agree on the scope of that change. Joseph Tarasco, president of Accountants Advisory Group, predicted that the uncertainty would lead to changes in firm structure.
Small firms, he believes, will start to fade out as partners fail to come to “consensus on succession planning and investing in the future direction of the firm.” Larger firms will be restructured away from the partnership structure as they grow even larger.
How accounting firms can adapt
Software of all stripes is great at preforming simple repetitive tasks. Accounting software can keep a bank balance current, for instance, by doing simple math over and over without error. In thinking about what your business is going to look like in five years, assume that everything even vaguely related to these sorts of calculations will be done automatically.
Likewise, data entry should be completely automated – barring some exceptions for cash heavy businesses. Accounting software will also make being on the customer’s site almost meaningless. Since fewer transactions will rely on a paper trail and more data will be held in the cloud, accountants will be able to work from anywhere.
Small businesses are going to be loath to embrace this knock-on effect, but it will also mean that you can do work at any time. Short notice or no notice, you’ll be able to jump right into a client’s books. That’s going to make late nights and weekend work part of the day-to-day, if I had to guess – others agree.
You can stop being jerked around by technology by embracing it. Be the company that understands how the changes in your clients’ software can make their lives easier. That means reading about new trends in the industry, keeping on top of the changes in business regulations, and thinking about businesses as holistic entities, not just a list of line items.
These changes are why Saasu foresees better predictive and proactive features in future iterations of accounting software. Soon, you won’t just get the automated balance reminders – you’ll get actionable alerts about holding off on purchases or scheduled payments to keep cash flow even. Accounting firms are in a great position to help small businesses understand and set those sorts of systems up. Don’t just follow technology, lead with it.
How individuals can prepare
These are actions that businesses can take to make sure they aren’t rolled under the coming wave of technology. At a personal level, focusing in on a specialty – especially one that requires those soft skills – is likely to pay off in the long run.
Accountants who can think like consultants – think about the competitive landscape, the potential for investment, increasing sales, etc. – will have a leg up over the ones who are just crunching away, heads buried in the weeds. Practice pulling back from your clients’ daily struggle to help them think about how they can structure themselves to take advantage of the future.
Overall, expect the next five years to bring a whole host of new challenges and tools to American accounting firms. Be open to new technology and get ready to take on a more strategic role with your clients. You might also want to fill up on midnight oil – chances are you’ll be burning through it.
Header by Rachel Wille