The number of changes facing the accounting profession will leave most practices radically altered in the near future, according to Barry Melancon, the president and CEO of the American Institute of CPAs.
Speaking at a gathering of technology vendors hosted by CPA.com and the institute, Melancon told attendees, “We are in a change management profession. The world requires changes in a quicker time frame than ever before.”
All those changes will have their affect: “We won’t recognize the vast majority of CPA firms in five or 10 years,” he predicted. “If all other businesses are going through major changes, who are we to think CPA firms won’t have to as well?”
Besides demographic, workforce-related and cultural changes that will reshape the profession, he cited developments like the cloud, blockchain technology, the move to integrated reporting, and cyber-security issues as likely to have a major impact – both for good and ill.
“Accountants work frequently in the ‘verification’ business – audit and attest and so on -- and blockchain is all about verification,” he explained, noting that 80 percent of banks plan to start blockchain projects this year.
In the near term, accountants should expect major disruptions in a core area, he warned: “Clearly audit is going to change dramatically -- it already is changing.”
While all these changes may sound scary, most come with complementary opportunities for forward-thinking professionals. “Ultimately, CPAs will be attesting to companies’ compliance with cyber-security standards,” Melancon said, while firms that explore blockchain early will be able to offer related services to clients.
With those possibilities available in the future – and developments like a recent uptick in the number of first-time takers of the CPA Exam – Melancon remains upbeat about the profession’s future, noting, “CPA firms remain the most profitable small businesses in America.”
Speaking at the same Executive Roundtable, CPA.com president and CEO Erik Asgeirsson encouraged accountants to dive deep into technology and embrace its potential.
“You can try to compete with technology, to circle the wagons,” he said, “or you can ask how it will help you deliver higher value.”
He cited the enormous recent above-trend growth in technology-enabled client advisory services as a great example of the kind of higher-end offerings accountants can deliver. “CPAs should not be worried about H&R Block or TurboTax,” he warned, urging them to move up the value chain. “That’s not where you clients are.”
“The move to cloud has set the profession up to leverage even bigger changes from machine learning, artificial intelligence and other tools,” he added, noting that the profession spends $3-5 billion a year on technology.
Daniel Hood is editor-in-chief of Accounting Today and Tax Pro Today, and has covered the tax and accounting field for over 20 years.