September 26, 2020

In Order to Save the Accounting Profession, It Has to Be Destroyed First

If you like hearing a broken record about the accounting profession’s problems, look no further than this Accounting Today piece.

It lists dozens of quotes from people wringing their hands over the profession’s three-headed monster of insurmountable obstacles: irrelevance (via technology), people and change. You’ll read it and either think, “The accounting profession is pathetic,” or, “Maybe I should start a firm to compete with these clowns.”

Really! It paints a grim picture of firms that are still out there, clinging to the past:

“Technology is moving so fast that all the bean-counting that has been the heart and soul of the industry is disappearing fast,” warned 2020 Group chairman Chris Frederiksen, describing how staples of accounting like recording purchases, writing checks, invoicing and others have disappeared in the face of automation.

And also the offshoring of not only work, but knowledge:

“It will not be long before automation will be able to handle most of the role of current CPAs,” said Sage senior director Ed Kless. “What computers can’t handle, offshoring will. It will not be long before there are more people in India more knowledgeable about the U.S. Tax Code than there are CPAs in the U.S.”

Ron Baker, of course, says that the accountants get the profession they deserve:

VeraSage Institute founder and value pricing proponent Ron Baker was even willing to doom the profession: “Unless our profession continuously innovates and adds value, we deserve irrelevancy,” he said. “What was the last innovation from the profession? We continue to avoid the tough issues, such as auditor independence. … CPAs need to help their customers make history, not just report on it.”

Which New Jersey Society CEO Ralph Thomas says drives away the diversity:

“I’m concerned that the profession isn’t producing enough CPAs to replace the Baby Boomers who will reach retirement age in the next five to 15 years. We need to motivate and incentivize accounting graduates to sit for the CPA Exam to ensure that our profession doesn’t suffer from a talent shortage in the future. I’m particularly concerned that the profession won’t be able to hold onto minority candidates if these issues aren’t addressed.”

And the stuff about “change” is the worst:

“The rate of technology change in the small-business marketplace is outpacing the rate of change inside small to midsized accounting firms,” according to Rootworks president and CEO Darren Root. “Firms are so inwardly focused on their own technology challenges that they are missing the opportunity that has presented itself to better serve this rapidly changing marketplace.”

Fax machines!

National Association of Certified Valuators and Analysts president Parnell Black described the permanence of ongoing technological change: “The profession is an old one still widely run by patriarchs who were around when fax machines were the newest and greatest technological innovation. I know this because I am one of them. We have seen unbelievable and transformative changes in technology since that first innovation, so much, in fact, that many of us have been in the middle of a learning curve throughout our entire careers.”

Is there any profession or industry that has been static for the last 100 years? All of them deal with change, but for some reason, “change” seems to have put the entire accounting profession in a perpetual tizzy. It’s depressing. Which is why all the things Chris Hooper has been saying this for a while are pretty spot on. I’ll even take it a step further and say a mass extinction is exactly what the accounting profession needs. Just start over. The world will still be here, it’ll just have different accountant life forms that can survive in this new environment that has changed too drastically for their predecessors.

Seriously, it’s fine. I mean, what’s the point of trying to convince accounting firm owners that change is necessary when they’re so resistant to it? If all of these so-called “influential” people can’t  convince them that it’s the best move for their business, then who the hell can? Let them perish and the rest of us will move on.

Losing Sleep [AT]

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