Nearly everywhere you look these days you see automation playing a bigger role in daily life. Your neighbor down the street has a home automation system that controls his lights and thermostat. At the office, your co-worker uses an automated system that automatically audits her computer code every time she changes something in the software package she is developing. Your utility company uses an automated billing system to send you a statement every month.
Automation is everywhere, even in accounting. The only difference for accountants is that their profession has been a bit slower to adopt automation than many others. Why? Because accounting is a profession that relies heavily on professional judgment. Computers are incredibly good at crunching raw numbers and spitting out data; they are not so good at making judgment calls.
Having said that, it is hard to deny that the computers are coming. CPA firms are beginning to see the writing on the wall. More and more automation will be coming to their industry over the next few years, and it will fundamentally change their profession. Below are descriptions of three of the most profound changes that appear to be on the way.
1. More Emphasis on Advice
One of the things that separates CPAs from bookkeepers is their specialized tax knowledge. Companies like Dallas based Gurian, PLLC do more than just keep the books. They also advise clients on everything from accounting principles to proactive tax planning. Their role as tax advisors will only increase as automation becomes more prominent.
Automation will make crunching numbers a non-event for CPAs. And while the computers do all of the math, CPAs will have more time and energy to devote to other things. In all likelihood, that means a greater emphasis on advisory services. CPAs will be relied on more for their tax knowledge than their ability to add and subtract.
2. Different Applications of CPA Expertise
As wonderful as automation is, it still relies on human input to function. In other words, a computerized system can only do what it is programmed to do. No automated system can read and understand changes in tax law, then apply those changes to an existing tax planning strategy.
This ultimately means that CPA firms and their clients will be relying more heavily on individual experience in the future. CPAs will have to be able to analyze and make use of the data automated systems generate. They will have to be able to tell the IT department how to modify the software in order to account for changes in the law. In short, CPA expertise will not be replaced by automation, it will drive automation.
3. A More Collaborative Environment
Finally, automation taking over the number crunching responsibilities of accounting will give CPAs more time and energy to cultivate their relationships with clients. This will help to create a more collaborative environment in which CPA and client work together to create the best possible outcome. To that end, CPAs should be looking forward to greater automation in the future.
CPAs have long lamented the fact that many of their clients just do not seem engaged. Clients send CPAs the information they need and then sit back and wait for the results. They are actively engaged in planning or strategic decision making. Automation will likely change that.
Automation has already started showing up in the accounting sector. Its prevalence and potential will only increase in the coming months and years. And as automation grows, the job of the CPA is going to change. That is not a bad thing. It is just different.