The world is changing rapidly. Society is changing. Client needs and expectations are changing. New markets develop. The chartered accountant of days gone by is not the chartered accountant of today and won’t be the chartered accountant of tomorrow. Known for their technical competence, in a technology era, the chartered accountant of tomorrow needs a new skillset.
In order to remain business relevant, CAs(SA) need to reposition and upskill themselves in whatever context they find themselves. There is no doubt that the Fourth Industrial Revolution (4IR) will impact markets, professions and jobs. However, the impact will be different at each ‘level’ of employment in which a CA(SA) finds him-/herself (role) and within each ‘level’. For example, the informal market will be impacted differently to the SME space and large business.
Journalists in the popular media frequently make the bold statement that accountants and auditors will be replaced by robots, but they do not realise that within professions there are also ‘levels’ of involvement. Clerks, bookkeepers, accountants, auditors and chartered accountants all have different roles or activity types within organisations and the probability of computerisation depends on the nature of work they are involved in and the time they spend on each task.
To understand the full probability of impact of computerisations, one must get into the detail of what CAs(SA) and professionals do and spend their time on. A study by McKinsey, the results of which is shown in the figure, shows the tasks (or activities) performed and how each sector will be impacted. The size of the circle indicates the time that is currently being spent on each activity and the colour emphasises the ability to computerise the task. ‘Professionals’, where CAs(SA) typically position themselves, currently spend approximately the same amount of time on data collection and processing as they spend on interfacing clients using their technical ability to solve problems and service clients. The one part can be computerised, the other cannot. A few examples of computerisation are:
Routine tasks (data entry and processing; repetitive bookkeeping; memorising accounting standards; recording journal entries) can be automated. This will leave accounting professionals to focus on strategic roles of process improvement, cost control, and capital optimisation.
Accounting period-end close off and complex reporting MS-Excel files and processes will be replaced with easy to understand artificial intelligent predictive dashboards with database integrate routines. Accounting professionals will then be able to think about the implications of the reporting rather than preparing the reporting.
100% data analysis by artificial intelligent systems using advanced analytics from a variety of data sources in real-time can predict the future more accurately and create time for analysis, provide better assurance if applied in an audit context. But more importantly, it will create new opportunities and markets for auditors to move away from financial statement audit and reporting to shareholders to providing assurance on data or other reporting to stakeholders.
Regulatory filings and other reporting can be automated through XBRL and other electronic data interchange platforms.
This will reduce the time spent on data processing.
This computerisation will create capacity for accounting professionals to add value to clients. But this requires them to upskill themselves. In order to upskill effectively, a CA(SA) needs to learn, unlearn and relearn. In order to aid this, SAICA developed a new continuous professional development (CPD) policy which came into effect in January 2020. CAs(SA) have always had a culture of learning and continuous professional development, but under the old CPD policy, recording learning activities were input-based (in hours). One of the objectives of the new CPD policy is for CA(SA) to maintain and develop their professional competence relevant to their current and future roles and place a lot of emphasis on a CA(SA) to take part in appropriate learning activities for their personal circumstances. SAICA does acknowledge that there are some skills all CAs(SA) must have and therefore SAICA may direct its members to undertake compulsory CPD topics.
Contrary to an input-based model, an output-based model requires a CA(SA) to take responsibility for reflecting on and undertaking relevant and appropriate learning activities for their circumstances. Reflection is an important part of an output-based model where CAs(SA) must maintain a reflective plan for the most recent three calendar years. It is no longer necessary to log every hour, but CAs(SA) must make an annual declaration to SAICA on his/her compliance with the new CPD policy and therefore may be required by SAICA to submit a reflective plan through SAICA’s monitoring process.
For information about the new SAICA CPD policy visit ca2025.co.za or send an email to newcpdpolicy@saica.co.za.
AUTHOR │ Professor Riaan J Rudman CA(SA), PGDA, MBusSc, MAcc, Stellenbosch University
