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Mini-series Part 3: Digitalization and the accountant

In the first two parts of this mini-series, I discussed the definitions of (Part 1) and role of AIS (Part 2) in digitization and digitalization. In this third part, I would like to highlight the development of the role of the accountant in this regard. Digitalization is both boon and bane of the future accountant – on one hand, it helps further the minimizing of his/her involvement in the nitty-gritty daily grind, the “bean-counting” the end of which has long been heralded by the automation of accounting processes. On the other hand, though, it raises questions about the legitimacy of the role – in other words, are accountants still needed? It seems an inevitable development that more digitalization means less and less accountants are needed to perform the same tasks, both in scope and quality. In this highly interesting article published by the WHU in Vallendar/Germany, the authors highlight eight challenges that current and future (management) accountants might face when confronted with the digitalization trend. The video below helps as an executive summary of the article, but I highly recommend to have a good read – you will learn that the digitalization trend does not have to automatically mean the end of the (management) accountant – if they get proactive with the technology and concepts involved.

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What accountants can learn from Kodak

As accountants, we are constantly under pressure to legitimise our own roles. With more and more typical accounting tasks taken over by IT systems – especially in the traditional area of cost accounting – we need to be careful not to miss the train. Daniel Richards details in this blog post why accountants should heed the analogy with Kodak – if we do not change, we will become a thing of the past!

Outgrowing your accounting software?

As a business grows, so too does its accounting needs. And this includes software. The are many choices to be made of a software  

 change is required. My own experience is the key thing to do is first understand where things are not going well. This post from it-director.com offers some useful advice.

    Careers in Accounting Information Systems

    From many chats with my accounting students, a large number of them seem to get the impression that studying AIS enables them to only pursue an accounting career. They more often than not react surprised when they learn that studying AIS opens career paths as financial or systems auditors, consultants, or even to upper management levels like CFOs. This article on Investopedia provides more details on these professions, their corresponding education requirements, and further links for the student interested in studying AIS.

    Big data, real-time analytics and the accountant

    We have often stated in this blog that the role of the accountant is changing. This change is heavily driven by new achievements in technology like cloud computing that enable anytime-anywhere access to decision-relevant data. At the same time, businesses acquire a plethora of data about their customers – so much data that professionals need the knowledge, skills and tools to excavate what is relevant, and what is not. As accountants, we should be in the middle of this “data excavation site”, handling this data mine to discover its treasures. This ACCA article argues that the finance profession (including accounting) needs to extend its reach and apply its core skills of gathering, manipulating and providing relevant information to a much larger data set. To enable accountants to do so, they will need to be the link between the IT department running the tools that enable real-time analytics of big data, and the business that needs to make sense of the results and put it in a strategic context. This will add skills to accounting that include data analytics and software engineering, leading to a hybrid role of accountants in the future.

    Ways for accountants and CFOs to keep up with technology

    Technological change has always been one of the common issues faced by accountants. What can accountants do to keep up with the pace of change. An article from CGMA provides some useful tips.

    Technology number 2 concern of Boards

    A recent report cited on CGMA’s website places technological risk at the second risk concern amongst a survey of Boards of Directors. The risk concern is with cyber-security, and was the number one risk concern of private firms. The report notes an increases in the perceived technology risk from previous years.  It is interesting (and good) that Boards are well aware of technological risk – as most large organisations today are so reliant on their information systems. You can read the full report here and the CGMA article here.