Can Artificial Intelligence Take Over the Jobs of Accountancy Professionals?
by StudyMalaysia.com on July 23, 2021 | Top Stories, Career Guide
Questions in the mind of parents and students
This is the question often asked by parents and children who are considering their career in accountancy. Am I pursuing a career which will be made obsolete in the near future by Artificial Intelligence (AI)? If I am an accountancy professional, will the robot take over my job?
Approach to address the questions.
To provide answers to the above, we shall approach the questions in three parts:
- What are the jobs of a typical accountancy professional?
- A survey on the current AI landscape with respect to the accountancy professionals
- How as an accountancy professional, one can work with and not against technology and AI to create unsurpassed advantages for oneself.
1. The Jobs of a typical accountancy professional
(A) He is a Moneyman
He is entrusted with the responsibility to manage the financial resources of the company – financial resources needed for the day-to-day operations, for projects, for investments and for future growth of the company.
The jobs entail cash flow and working capital management, the sources of finance like bank overdraft and short- and medium-term loans from banks, issues of bonds, issue of shares, initial public offering (IPO). It also entails good working relationship with stakeholders, like suppliers who provide trade credits, bankers, bond holders and shareholders.
To maintain good relationship and build confidence with these suppliers of credits, regular reporting of the financial position and financial performance of the company through financial statements is essential.
(B) He is a Statutory Financial Reporting Man
He is responsible for the preparation of financial statements (from source data like customers’ and suppliers’ invoices, records of money received and paid), and the reporting and interpretation of the financial statements to the Management, the Board of Directors, to existing shareholders in Annual Reports and in the Annual General Meeting of the shareholders, to potential shareholders who intend to invest in the company in the stock exchange, to bankers, bond holders, creditors, employees, income tax authorities and to the auditors.
Often at the Annual General Meeting of the shareholders, he is seated next to the Chairman to help answer questions raised by the shareholders in respect of the financial affairs of the company.
(C) He is the Conscience of the Company – A Watchdog or a Bloodhound
As an accountancy professional, he needs to exercise professionalism in terms of ethics, integrity, and corporate governance to safeguard the financial resources of the company. He is responsible to implement internal controls to ensure that the operations of the company are carried out in an orderly and systematic manner and that there are checks and balances in the systems and procedures of the company.
He also needs to maintain close liaison with the internal and external auditors, Risk Management Committee and Corporate Governance Committee to ensure proper corporate governance is in place.
In the context of the Malaysian corporate scenarios where there are substantial leakages and corporate failures due to corruptions and unethical practices, the role of the accountancy professional as bloodhound is even more needed and significant to safeguard the financial resources of the company.
(D) He is a Financial Performance Measuring Man
He facilitates the measuring of financial performance via the setting of financial goals and budgets for various strategic business units. He prepares and provides actual financial performance statistics and use these to measure against the financial goals established for each strategic business units.
In the measuring exercise, he provides analysis for the variances from the set goals and recommend remedial actions to enable the goals to be achieved. Often these financial performance goals are tied to the Key Result Indicators of the responsible managers and form the basis to provide incentives and rewards for managerial performance.
(E) He is a Strategic Business Leader
He is one of the strategic business leaders of the company in helping and facilitating the company to formulate short term and long- term decision making in order to sustain the business operations and to grow the company either through organic means or through mergers and acquisitions.
Together with the Chief Executive Officer, he must have a deep sense of awareness of the potential risks arising from the advent of disruptive digital technology that may disrupt and transform existing business models. He must be keenly aware of the risks to avoid and opportunities to be capitalized with the ever-changing digital business evolution.
As a strategic business leader, he must be involved deeply in the cognitive understanding of the business, its financial performance, the changing environment, the changing technology, the changing buying behavior of its customers, the analysis of trends and the prediction of the future using the latest tools like big data analytics. In so doing he will be in better position to avoid threats, strengthen weaknesses, capitalize on strength and opportunities in order to help ensure the sustainability of the company in the long run.
Brief Summary of the Jobs of A typical Accountancy Professional
- It is a position of trust and accountability – where professionalism, ethics, integrity must be exercised.
- It is a position which requires complex technical and professional skills involving analysis, decision making, judgment, skepticism, creativity, and innovation.
- It is a position of heavy responsibility – helping to sustain the short-term survival and long-term growth of the company.
Think! Can any existing AI machine do the above jobs? Now let us turn our attention to the existing landscape of AI.
2. Landscape of AI related to the Accountancy Professionals
Briefly, AI can be defined as:
Computer does something that require the intelligence of a human, or anything that mimics human intelligence or the ability of a computer programme or a machine to think and learn.
Big data and data-analytics
These relate to the systematic computational analysis of data and statistics which are now generated with very high volume, velocity and veracity. Through the algorithms, the computer can be programmed to recognize pattern and hidden trend and to help predict and trigger issues before they happen, rather than react after the event.
Through this capability, the computer can be programmed to predict the buying pattern of consumers so that the company can predict and plan for specific expansion of product line to capitalize on the buying pattern to increase revenue. Have you ever wondered why YouTube often predict and recommend correctly your favorite programmes?
The capability can also be used to speed up problem solving, improve the quality of decision making. We often listen to entrepreneur who says that I am in this business for 30 years and I make my decisions based on guts-feel and I have not yet been proven wrong! Now he can improve the quality of his decisions on sound scientific basis based on big data and data-analytics.
Data-analytics are also used in weather forecast and to predict the coming of natural disasters.
Current users of big data and data-analytics are Airbnb, Alibaba and Jindong to predict customers’ buying trend.
The spotting and prediction of pattern and hidden trend helps in the decision-making process. Big data and data-analytics would not take over the jobs of an accountancy professional. It is just a tool to help him make better decisions.
Robotic Process Automation (RPA)
RPA is a robotic process to automate the input of large volume of data for accounting operations and ultimately for preparing the financial statements. It is used in data entry, form processing, data migration and data input from paper to digital. It may also be used in pulling data from the website to find the best deal.
RPA can automate very high volume of mundane and rule-based process and help to reduce human errors. It is more efficient and work 24/7 without tiring. It reduces human drudgery by automating repetitive tasks. It is cost savings and reliable and it also provides the audit trail.
RPA does not take over the job of an accountancy professional. It helps to free his staff from the mundane, repetitive tasks to focus on jobs that add more value to the company like focusing on financial statement analysis and recommending timely remedial actions for adverse variances from the set financial goals.
To an accountancy professional, block chain is a distributed, decentralized public ledger. The goal is to allow information to be recorded and distributed but not to be edited. Entry can be made at different geographical locations. It is verified but it cannot be changed. Therefore, it eliminates third party verification. It is a secure, private, efficient, and transparent technology.
It is used by banks, Bitcoin, health care, property records and smart contract and even in voting. It is also used by supply chain management in the real-time tracking of goods.
Block chain is a distributed ledger used to keep records in a more efficient manner. In no way it can take over the jobs of an accountancy professional. Whereas he can use this distributed ledger to do his job more efficiently.
Cloud Computing and Social Media Platform
Cloud computing are data and programmes in the “cloud”. It is used for file storage, data back-up and disaster recovery. It is a service platform to enable flexible and remote working. Geographical dispersed team can work together on the same project real time.
Microsoft One Drive, Google Drive and Drop-box are examples of cloud computing platforms that we are all accustomed to use on our daily basis.
Social media like Face Book is platform normally used in marketing to reach out to target audience and potential customers. It is also used as network to facilitate communication with peers. The influence in the voting trend in general election and the use of the platform to call for street demonstration exhibit the power of such social media. Likewise, in the lock-down pandemic scenarios, it may be a powerful marketing tool to reach out to your target customers.
These are tools for use to help the accountancy professional in the performance of his jobs. In no ways his job threatened by these tools.
A great deal of the jobs of an accountancy professional will require multi-discipline technical, professional skills (accounting, laws, government regulations, accounting standards, listing rules and so on) and the synthesis of these knowledge and skills with ethics, integrity and human interaction to arrive at judgmental decisions, exercise skepticism and creativity to resolve issues, sustain operations and to plan ahead. AI cannot do that!
For example, in the expansion of business through mergers and acquisitions, the process will involve business evaluation (valuing the worth of the business to arrive at a value for negotiation), negotiation (often many face-to-face meetings), preparation of Sales and Purchase Agreement based on the negotiated terms and conditions (require legal knowledge and expertise) and the final cultural assimilation of the two or more businesses (the merging of business culture and practices involving human behavior). It will be impossible for a machine to do the above jobs!
No Doubt at All - AI Cannot Take Over the Jobs of Accountancy Professional
With the ever and speedy emergence of new technologies like AI, an accountancy professional needs to respond and embrace and harness the new technologies like Robotic Process Automation to enhance the productivity, the effectiveness and efficiency of the company.
He does not need to fight new technologies. He embraces new technologies to place the company in a competitive position and place himself too in a position where he is ahead of his peers.
About the Writer of this article
Mr. David Lam Hai Chiang FCCA, CA(M) is currently the Director and Head of Imperium Centre for Professional Accountancy at Imperium International College. He is a veteran ACCA professional who has gained valuable experience in the profession, in the corporate and education sectors over a period of 45 years. His varied exposure includes being an audit associate in London to Chairman of Foreign Equity Companies in 7 cities in China.
About Imperium International College
Formerly known as HELP College of Arts and Technology (HELP CAT), Imperium International College (Imperium) successfully completed the takeover of HELP CAT and resumed operations in March 2020.
Imperium International College is owned by MAA Group as the company puts focus on expanding its education business. MAA Group also owns St John’s International School and Pusat Tuisyen Kasturi under its subsidiary, Edumaax Sdn Bhd.
As a progressive Institution of Higher Learning, Imperium International College is a Platinum ACCA Approved Learning Partner. The College takes pride in training future-proof and IT enabled accountancy professionals with leadership, communication, and decision- making skills. It is the mission of the College to create unsurpassed competitive advantages for her graduates in their future career development and advancement.
For more information on Professional Accountancy programme offered at Imperium International College, kindly visit www.imperium.edu.my or call 03-2788 2115.