Disruption alert: will CAs be redundant in 2025?
“We are experiencing a period of radical change,” says Mandi Olivier (pictured), senior executive for professional development at the South African Institute of Chartered Accountants (SAICA), when asked about the Fourth Industrial Revolution.
Globally, the chartered accounting profession is being asked to look into a crystal ball. No one can say with certainty what the future will hold but to continue contributing value to society the profession needs to re-imagine itself. For professionals focussed on absolute accuracy, this is more than a little unsettling. The main change agent is technology - besides other disrupters including rising geopolitical volatility, institutional changes and changing societal values.
The World Economic Forum (WEF) defines the Fourth Industrial Revolution as 'The possibilities of billions of people connected by mobile devices, with unprecedented processing power, storage capacity and access to knowledge as unlimited.'
"These possibilities will be multiplied by emerging technology breakthroughs in fields such as artificial intelligence, robotics, the Internet of Things, autonomous vehicles, 3-D printing, nanotechnology, biotechnology, materials science, energy storage and quantum computing."
But why should these technological advances disrupt the accounting profession?
Disruption of the status quo
Many of the functions currently performed by CAs could soon be performed by sophisticated technology. This is not a question of 'if' but 'when', says Olivier. But surely the idea of CAs reinventing themselves into a different professional persona is a bit like saying that we don't need some of their attributes? Might we lose something in the process? What will be the role and needs of business and government in a more digitally transformed future? One thing is certain, CAs stand to lose a lot if they do not reinvent their mix of competencies. But if they get it right, they potentially enter an exciting new era.
The entire future of the profession rests on the speed with which it can reinvent itself to the changing needs of business. For example, one possible outcome is that large auditing teams will be reduced considerably; with systems able to audit and process large volumes of data. This means productivity will rise and will free up professionals to add value to companies in other ways.
This very point was debated on by representatives from leading CA Institutes from around the world recently when South Africa hosted more than 45 representatives from the UK, Australia, New Zealand, Ireland, India, Pakistan, Singapore, and Scotland at a Chartered Accountants Worldwide event. The general sentiment voiced by delegates at the event was that employers will have a more critical role to play in upskilling their employees with these changing profession requirements as the need to learn, unlearn and relearn new skills increases. It is estimated that that this re-evaluation will need to happen as often as every five years.
The challenge to learn a new mix of competencies doesn't just rest with young people entering the profession but with existing CAs, who need access to relevant learning opportunities on an ongoing basis. In its project coined, 'CA2025', SAICA, together with the Independent Regulatory Board for Auditors (IRBA), has commissioned research into the expected competencies of CAs(SA) and RAs in the future.
Researchers from the University of Pretoria are conducting the research in two phases. The first phase, which was completed recently, comprised six focus groups. The second phase will include 85 personal interviews with key stakeholders.
The research participants are as diverse as the sectors served by the CA profession, and include the Auditor General South Africa (AGSA), all accounting firms; from the larger ones right down to the small ones, as well as regulators, professional bodies, CFOs of top JSE listed companies, portfolio asset managers and futurists. The entire research project is expected to be concluded in 2019.
"Our emphasis is on the need for CAs(SA) to be relevant and to evolve as the process unfolds. Reinvention of the accounting profession can never be a one sided debate. We need people at all stages of the profession: newly qualified and established; the universities and schools, and the private and public sectors to offer their perspective."
Olivier adds that she is extending a challenge to universities on changing the current CA(SA) curriculum.
But SAICA is consulting wider than just the universities in defining the competencies of a future CA(SA) and will be giving members of the profession a chance to air their views through surveys later in the project. There will also be changes to the curriculum at prequalification level which that impact the pipeline from learners through to students and trainees. Post qualification, there will be an increased emphasis on lifelong learning. As working environments change, the future CA(SA) may be unrecognisable from the CA(SA) of today. One quality will, however, remain; CAs(SA) will continue to be trusted and ethical leaders who are committed to the truth.