Dan Nicholson is the CEO of Nth Degree CPAs and an author helping purpose-driven entrepreneurs achieve financial certainty.
The accounting profession is facing headwinds. Warnings about the growing shortage of accountants and even the death of the accounting department as we know it due to advances in artificial intelligence have circulated over the past couple of years. If you believe the rhetoric, it’s a doomsday scenario for those of us who’ve built firms and careers around the language of business, so to speak.
For many who’ve made a living out of numbers, it’s hard to argue. The Association of International Certified Public Accountants (AICPA)’s 2021 Trends Report (download required) showed the number of CPA exam candidates decreased substantially in 2020—17% between 2019 and 2020. What’s more, fewer of those who are taking the exam are passing. The number of CPA Exam candidates who passed their fourth section of the exam decreased 11% between 2019 and 2020. And these figures don’t even count those set to retire.
There are several possible reasons I can think of and burnout, repetition and lack of pay all top the list. As someone who’s worked in and with the big firms, I get it. Accounting gets a bad rap. I’ve worked in the accounting field for decades, and I’ve had jobs where I felt underappreciated and underpaid. But that’s why I eventually went out on my own—I wanted to create something different that also helped people and small-business owners. I’ve also always seen the work as important. So, I choose optimism. Where some may see potential doom, I see opportunity. Here’s why:
Accountants As Essential Workers
Accounting is not just necessary, it’s critical in making sure organizations (and in turn, our economy) can function, thrive and grow. The work and impact might not always be visible, but it is important.
Recently there was an article in The Wall Street Journal around how the accounting shortage had finally reached a tipping point in that companies without fully staffed accounting departments are reporting material weaknesses in their internal controls over financial reporting. Basically, this means these companies are disclaiming the accuracy of their accounting records. It also means those companies could be more susceptible to ongoing financial and operational issues.
Some of these companies are pioneers of sorts; they’re innovating across fields like biotherapeutics and aviation. The world needs innovation, and companies like this need future-focused accounting professionals to help them bring it to life.
Architecting The Future
Many people view accounting and CPAs as living in the past. They see boring, repetitive work. We have an opportunity to use a different lens and mindset.
I like to use the analogy of thinking about accountants as architects versus archeologists. What I mean by that is archaeologists are detectives of the past. They’re experts on history who gain expertise through historical documents and artifacts.
Architects are playing a different game. Architects are visionaries, inventors and innovators. They’re shaping futures and transforming ideas into reality. That’s exciting stuff, and it’s the type of work we have the opportunity to do as accountants.
Modern Tools And Approaches
Operating and partnering with clients in a more future-focused way means embracing more modern tools and approaches to the work. Tech has changed the accounting profession and made it both more efficient and more exciting. Some of the stuff that used to be done manually—think invoicing, bill paying, bookkeeping—can now be automated. That gives us more time to do the strategic stuff that makes the bigger, future-focused impact, such as financial analysis and forecasting and helping clients plan for longer-term plans and investments.
AI is of course a huge opportunity for the profession. Aside from freeing up more time, AI can also help us identify patterns and trends that, in turn, lead to ideas, advice and suggestions for our clients.
I’m a big believer and proponent in using modern approaches, tools and technology to stay ahead. I think those who embrace it will start to see the potential and opportunity in our field in a new way.
The bottom line is the accounting profession is facing a challenge as the demand for accountants continues to grow while the number of qualified professionals slows. But the industry has always been able to adapt and evolve to meet the changing needs of businesses and society. Between new tech, different ways of thinking and the sheer need for accounting expertise, it’s an exciting time to be part of the field for those willing to embrace change and continue learning new skills.
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