Currently, the International Federation of Accountants (IFAC) creates the rules for auditing. This organization, like the public accounting profession as a whole, is dominated by the "Big Four" accounting firms: PwC, Deloitte, KPMG, and EY. This organization makes the rules for auditing and is also the people doing the auditing. This has raised concerns by global regulators. They would prefer if auditing rules were made by a third party in order to avoid possible conflicts of interest.
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More and more companies today are concerned about sustainability and corporate social responsibility. Consumers and investors are more conscious about these factors and so are the business that want to do business with them. Currently, more than 80% of S&P 500 companies release sustainability reports. But these reports don't have any legal standards, so they are hard to compare to each other. The Sustainability Accounting Standards Board (SASB), a non profit organization, hopes to create standards for accounting for sustainability that can become universal.
Just like the Financial Accounting Standards Board (FASB) creates rules for financial accounting standards, SASB wants financial reports to disclose information to stakeholders about their sustainable practices. According to Bloomberg.com, SASB has been receiving feedback and working with companies to decide what these appropriate standards should be. SASB plans to be finished codifying their standards in 2018. This is a very big change from traditional accounting standards that I have learned so far in my accounting courses. Although SASB reporting will probably not be made into law in the immediate future, stakeholders demand this information, so it may very well be the new industry standard. Hopefully, I will get a chance to learn more about this standards before I graduate from Penn State in 2019. Having this knowledge would be very valuable to a company full of accountants who only know the traditional way of doing things. Read the full article here: https://www.bloomberg.com/news/articles/2017-10-12/the-next-phase-in-sustainability-disclosure-is-coming-q-a Throughout history, changing technology has had a habit of making old ways of doing things obsolete. Since the dawn of the computer, technology has improved exponentially, and many jobs have been made obsolete, and many more will become obsolete. Computers with artificial intelligence may be threats, not only in science fiction movies, but possibly also in the field of accounting.
A new study from the finance and accounting firm, BlackLine, claims that three quarters of accountants believe artificial intelligence will have a significant role in corporate accounting in the future. Additionally, 60 percent believe that AI could automate accounts receivable and accounts payable and 49 percent believe that AI can automate reconciliation. At my internship at Alps Controls this past summer, I saw firsthand the beginning of computer automation being used to perform day to day accounting tasks. My primary responsibility in this internship was processing vendor and customer invoices. The automation the company was beginning to use could do the same exact task I was doing. If it were fully implemented and operational, this automation system could have completed a full human work day in minutes. While I was with the company, the system was only being used for a few vendors, and the system did stumble across errors every once in a while that would need to be corrected by a human, but I feel in a short amount of time this system could make human invoicing obsolete. This has implications for accountants of the near future. Tomorrow's accountants will need to have a more diverse set of skills to stay relevant in the field. This makes me more determined to follow my current goal of getting my Certified Managerial Accountant certification. AI may be able to automate routine tasks like invoicing, but it will (probably) be a very long time until computers can make real world managerial decisions. Read the full article here: https://www.pymnts.com/news/b2b-payments/2017/blackline-artificial-intelligence-automation-accounting/ |