« XBRL Extension: Three Reporting Models, Not Just Two | Main | Example of XBRL's Ability to Detect Information Errors: US Census Data »

Accountants will Become Reviewers of a Largely Automated Process

An interesting FSN article (titled Runbook CEO, Herman Heller, says automation of close processes is set to change the annual audit) talks about how automation of the financial statement close process will change the audit process, making auditing even more of a commodity than it is today. 

Here are some of my favorite statements in the article:

According to Runbook and its devotees the accountancy world is on the threshold of one of the biggest changes in its history. In the next decade, recent developments in information technology will drastically change the role of the accountant during inspection and review of a company's financial statements. Auditing will become even more of a commodity.

And this...

It is this level of automation and dependency that Heller believes will not just revolutionize the process of closing the financial year and quarter, but also the structure of the accountancy industry itself.

And this...

"We believe this new model for period closing will turn the accountancy world on its head. Auditing costs can be reduced drastically; a result that especially the corporate world will appreciate," adds Heller.

And this...

Heller believes that there will be little downside for accountancy firms.  "Society is gradually changing the demands it sets for accountancy firms, in part caused by their role in the recent financial crisis. Public opinion is calling for more safeguards against financial risks. Partial automation of the auditing process will give accountants the opportunity to shift their attention in this direction."

And finally:

In the end it's a matter of adapting or losing for accountancy firms, because there is no way back. CFO's are already welcoming the new auditing model, because it saves them time and money. The Dutch Tax Authority has given its permission to use it and it's a matter of time before the first accountancy firm will adopt this new model integrally. From that moment onward, competing accountancy firms are left without a choice. But when accountancy firms will adjust their procedures accordingly, they too will become winners in this new model.

At the same time the author is pointing out that accounting firms have little to loose, but fear this new model.  Sounds like opportunity for those willing to learn about the new model.

PrintView Printer Friendly Version

EmailEmail Article to Friend

Reader Comments (3)

Thanks for the link,
Indeed this is a big opportunity for those willing to adapt. Recently i sat in on a presentation for accountants about XBRL (or SBR here in the Netherlands) and its consequences for the way they work. I will read the FSN article but from the points you mention in this post it sounds very much like the things i've heard. The Tax authority is moving towards a different role for itself and the accountants/auditors. Auditors can expect a closer relationship (based on mutual thrust) with the Tax authority in coming years especially in the area of the small and medium businesses. A process that will be largely automated with the auditor being the enabler of delivering correct returns to the different government authorities (Chamber of Commerce, Taxes etc...)
May 2, 2010 | Unregistered CommenterBrian Mulder
Hi Charlie. It will be interesting to see where the accounting world will end up. In the last fifteen years the IT programming world has moved from a Science programming degree or a Business programming degree to a thousand different languages, standards and applications all to meet different purposes.

The accounting world has held a common line of fundamental understanding through their core degree and accreditation programs. What XBRL and associated technologies will do is to move the traditional skills into the IT infrastructure and move the accountant to a information analyst. Ten to Fifteen years after will the traditional accounting teaching models be moved into information processing courses and will we loose the fundamental historical accounting knowledge. Will the required learning curve to become "competent" in the new world prohibit new starters?
May 3, 2010 | Unregistered CommenterWarwick Foster
Blossom, actually should nothing to do with the season. A lot of time in his life is confused, find a better reason to let himself not to want to some other people think unimportant matters.
We all like a clown, in our lifetime playing five balls, the five balls is work, health, family, friends, and spirit. Five balls with only one is rubber, fall can play up and that is work. The other four balls are use made of glass, the off, broken... lxnvfd lxnvfd - <a href="http://www.radiisupras.com">radii supras</a>.
December 19, 2011 | Unregistered Commenterhezcjh hezcjh

PostPost a New Comment

Enter your information below to add a new comment.

My response is on my own website »
Author Email (optional):
Author URL (optional):
Post:
 
All HTML will be escaped. Hyperlinks will be created for URLs automatically.