It has been said that the end is nigh for the role of the chartered accountant (or CPA in the USA). According to the Institut Sapiens think-tank, the profession joins those of banker, secretary, warehouse worker and cashier in the top 5 jobs destined for extinction by 2020 (link in French). The reason? Digitalization and progress made in Artificial Intelligence will automate the role, making human input redundant.
"If a technological alternative exists for a human job, then it will be chosen systematically as a means of increasing productivity," says Erwann Tison, the institute's director of studies.
Yet, replacing humans with software totally undermines the importance of personal, expert guidance. Certified accountants are often trusted advisors to businesses and they must harness new technology to reinvent their trade. Not kill it.
Automating and streamlining time-consuming tasks clearly has its benefits. Neglecting experience and the human touch clearly does not.
In this article we examine a profession that's undergoing drastic change and disruption, but whose days are not necessarily numbered.
A brief history of accounting
Accounting as we know it today began in the 19th Century and was formalized in the UK in 1880 with the advent of the Institute of Chartered Accountants in England and Wales. In France it wasn't until 1912 that modern-day accountancy came of age with the Compagnie des Experts-Comptables de Paris.
However, the roots of accounting as a principle can be traced to ancient times, all the way back to the Mesopotamians some 7,000 years B.C. Documents unearthed from this period show lists of inventory, expenditure and goods being traded amongst communities. Primitive auditing systems have been discovered on clay tablets (developed by the ancient Babylonians) and on papyrus (in ancient Egypt).
Following that, it wasn't until the Middle Ages that the practice underwent deep and rapid change. In 1494, Italian mathematician Luca Pacioli, a pal of Leonardo da Vinci, formalized double-entry bookkeeping in his work Summa de arithmetica, geometria, proportioni et proportionalita. It set a new standard in accounting and brought the dawn of bookkeeping with two columns: debit ('he owes' in Latin) and credit ('he entrusts'). It was the first time algebra and the plus and minus symbols had been found in print.
His publication accelerated the sophistication of accounting over the course of the ensuing centuries and saw words such as 'balance' and 'reserve' adopted in the world of commerce.
The next seminal moment came in the late 19th Century, during the post-Industrial Revolution trade boom. Analytical accounting developed quickly to meet the needs of this new commercial world, the centre of which was London. To establish standards and rules of conduct and admission, professional guilds were given a Royal Charter, leading to the term 'chartered accountant' in 1880. Seven years later came the American Institute of Certified Public Accountants, giving us the modern-day CPA.
So the history of accounting is long and rich. But what about its future?
The Chartered Accountant or CPA: much more than a number-cruncher
The profession of accountancy is associated with some stubborn stereotypes: accountants are sometimes seen as joyless, tight-fisted pen-pushers constantly hunched over calculators and spreadsheets at a desk piled high with reams of documents containing numbers in endless rows and columns.
Having worked alongside accountants for years, we at Qonto know that these facile clichés are not at all representative of the true work they produce.
The reality is that, as an accountant, you are much more than a number-crunching financial controller. You are a strategic partner for a company and there's a human element to your work that is often underestimated. Your expertise goes much further than simply rubber-stamping bookkeeping documents.
You require a deep understanding of business culture to be able to do your job. You advise and guide business owners at crucial moments in their companies' development.
If your client wants to invest, start or buy a company, streamline their tax payments, manage their assets or develop their activity abroad, to whom do they often turn? To you, their accountant. You help them forge their strategy, capitalize on their successes and mitigate their failures.
This is why choosing an accountant is not something that should be taken lightly. You are privy to confidential information about a company and take part in the most sensitive meetings. You need to build relationships with CEOs that are based on trust in order to drive the company forward.
Working with technology, not against it
The digital age has shaken the business world to its core, just as it has society as a whole. Online accounting agencies have been springing up in tandem with the rise of new technologies, led by Artificial Intelligence and Big Data. These innovations make it possible to process huge volumes of data and to automate bookkeeping processes that, before, were the preserve of chartered or certified accountants.
So, in terms of your job security, need this be a cause for concern? What will be the impact of technology on the accounting profession? Will full automation be the end of human intervention? Not necessarily.
Let's see the technology as an opportunity to be embraced rather than a threat to be feared. Let's allow this innovation to transform and inject value into a profession that still has humans at its heart. Leave the software to take care of the mundane, menial, mindless tasks so that you can focus your energy on strategic issues that demand knowledge, human experience and nuance.
Let's take an example.
One of your principal tasks is to keep the books of your customers in good order. For you to be able to sign off on them, you need to be absolutely certain that every detail is checked, reliable and accurate. It's the numerical equivalent of crossing the 't's and dotting the 'i's. And that part of the job can be incredibly tedious and a massive drain on your time.
This is where AI - and in particular machine learning - can be your greatest ally. Machine learning, a sub-branch of AI, allows algorithms to recognise precise patterns and individual data. In concrete terms, they are able to identify and differentiate invoices, estimates, purchase orders and payslips, and then categorize them.
This will save you a significant amount of time revising and editing your customer's accounts. You no longer have to worry about running around trying to find proofs-of-purchase and paper receipts and associating them to the corresponding expense. It's all done for you by the algorithms. The technological help doesn't stop there; it can also:
- extract information from documents and apply them to a chart of accounts;
- input data automatically.
Not only do these features save time, they also ensure accuracy by eliminating the risk of human error. It's your professional credibility at stake, after all, so why not leave the donkey work to algorithms that are designed to guarantee exactitude and precision? It allows you to gain in productivity, reliability and peace of mind.
With the tedious and time-consuming jobs done by the machines, you and your teams can concentrate on the essential tasks of advising company directors and developing your business culture.
So are robots the chartered accountants/CPAs of the future?
In a word, no.
Certainly, the accountancy profession will have to adapt, evolve and reinvent itself. But it has been doing just that for thousands of years. The technology is not an end in itself, but rather a means of reinforcing the work of a certified accountant. It cannot replace the very human relationship that binds you and your client together.
We believe that the accountant of the future will be able to invest in this human aspect of the job and be even better placed to advise and strategize. We believe the role will become more and not less vital to the success of a business.
However, adapting will be key. Knowing which tools and processes to adopt will come under the remit of the accountant of tomorrow. So how can you ensure you obtain and then maintain this knowledge?
- By training your teams to fully understand the opportunities of digitalization and the use of AI. Keep up to date with the latest developments via conferences and webinars. The Ecole de l'Expertise Comptable et de l'Audit (ENOES) is among the growing number of schools in France that now offer training dedicated to the mechanics of Big Data.
- By equipping yourself with the right tools. Qonto provides services that give accountants the visibility they need over customers' accounts as well as specific solutions, including accounting software, tools for storing and sharing accounting documents and CRM software that streamlines how you manage relations with your clients.
Amongst other providers of the above, we can propose Dext, Pennylane, MyUnisoft, Cegid, ACD, Sage, Ibiza Software or Agiris. You don't need to be an IT wizard yourself to use these tools, as they're all designed to be intuitive and simple to use. It's your analytical mind that will come in useful.
So don't swim against the current; swim with it. Embrace the technology, let it do the boring jobs so that you can focus on the subtleties of strategy.
The days of the accountant may be full of figures but they're far from being numbered.