1.1 Introduction
Numbers are traditionally the accountantâs domain. Businesses trust that professional accountants and auditors will maintain, monitor and deliver the required figures to report their activities. But increasingly a mastery of numbers is not the only task expected of the modern accountant or finance professional. Business decision-makers need to have confidence in the data that they use to make decisions, but they also need to understand what is behind the headline figures. They need to follow the trends to anticipate new business markets and opportunities , to be aware and mindful of the environment in which they operate and have confidence in the ability of their accountants to step up and contribute to a range of contemporary issues.
In this book, we seek to go âBeyond the Numbersâ; we consider a range of current developments in accounting that can help accounting and finance professionals to be well placed to contribute to the future of businesses, to the economy, and to our collective social welfare.
This book explores the developing challenges and opportunities within the business world which are likely to impact on the accounting profession in the foreseeable future. It outlines several approaches to ensure that the accountants of the future are equipped with a useful awareness of some of the key topic areas that are quickly becoming a reality.
In this sense, the book helps to bridge the gap between academia and practice and thus equips students with the knowledge to discuss and contribute to topical issues within the profession and to be able to then implement this knowledge skilfully and appropriately. It will also appeal to practitioners who may be looking for concise introductions to several contemporary issues which are likely to impact upon their profession in the future. Many of these chapters outline the changing external business environment and updates on several important developing issues. Many of the authors also demonstrate a range of the accounting industryâs responses to these changes within their specialist area of expertise .
Although we cannot claim to predict the future; we have made reasonable speculation of the issues that are seen to be contemporary, and we have been able to objectively observe what we see happening within our industry, all to provide the reader with that knowledge. All the contributors have researched the literature and made use of their considerable experience within finance or accounting to extrapolate the near future and to support readersâ awareness with our expectations of the future.
What is meant by âcontemporaryâ? Merriam-Webster (2018) define contemporary as simply, âmarked by characteristics of the present period: modern, currentâ. Therefore, it is what is modern and it is what is happening now. In this book, âContemporary Issues in Accountingâ, we discuss our observations on accounting issues that are emerging or are already having some impact on the accounting profession .
Our experiences are wideâmany of the contributing authors here have had long, interesting and challenging careers in accounting and financeâand they talk objectively about issues both present and future within their profession as they see it, ably supported by some non-accounting professionals whose subject disciplines are found to interweave with that of the accountant. We hold the view that the accountant has a unique central and deeply embedded role in an organisation. This team-style delivery that you will see evident in this book is purposefully designed. Non-accounting professionals have many discerning and relevant skills and knowledge that help them see the world from a different contributory perspective to the accountant, and vice versa. Accounting professionals need to work with, discuss with and challenge themselves and their own knowledge though others.
A recent headline in the accounting periodical, PQ Magazine (2017, p. 1) claimed, âAudit isnât sexy enough anymoreâ. It seems to us that the world of business is continually evolving, business is big news. The cover article in PQ Magazine discussed how fewer people are being drawn to a career in audit . The skill-set of potential recruits was questioned; âAccountancy could be asked to take a back seat as firms look to recruit more data and risk analysts, and cyber security expertsâ (PQ Magazine 2017, p. 1). Skills and in particular, technology skills are likely to be an area of significant change in accountancy which we address in several chapters as we discuss the impacts of Big Data and other technologies such as blockchain. Data collection is also an important concept in performance measurement , and we consider when there is too much data: âmeasuring the shadow of the shadowâ. The skills-gap is also covered in a later chapter on self-leadership which discusses some of the softer skills which will be required in future professionals.
The word âprofessionalâ is used frequently throughout this introductory chapterâthis is by design. We believe that the professionâdespite some occasional scandalous financial behaviour that is laid at the doorstep of the accounting profession âwill thrive, albeit change. There is continued scrutiny of the accountability of business and accounting firms, particularly in the wake of the business collapses (for example following the recent collapse of Carillion (The Guardian 2018)). This trend to greater transparency will no doubt continue, with increased emphasis on ethics and humanity, in terms of being accountable to wider society . Whilst the profession may increasingly rely on technology for basic data capture and analysis, which should eliminate many errors intrinsic to human data input, it will still require the human touch to unlock the value contained within it.
This aspect of humanity as the impact of oneself on oneâs environment is also evident in Parker and Warrenâs (2017) work, where they refer to an âundesirable accountant stereotypeâ held in the public perception of accountants within society . Their findings focused upon the perception of accountantsâ own professional identity in relation to their own career aspirations. Their study suggested that accountants align their professional duties with their own personal values , strengthening interpersonal communication as they develop, but that they actively attempt to improve the image of the accountantâs impact upon their immediate and wider environment and community âthis being done by being intertwined with their professional career development. In other words, their job did not take over their life, it was described as a âsubsetâ of it. Parker and Warren (2017) concluded that accountants âattempt to recraft their role and portray an image that reflects an interactive, advisory, leadership identity to which they aspire and wish to projectâ (2017, p. 1917).
Hence this book presents a set of chapters that will help you, the accounting professional, to be able to be aspirational, to work towards a fuller knowledge of the interwoven aspects of your professional career . We have chosen pertinent themes and areas of current note that you will find that you need to be well versed upon.
1.2 Guide to the Structure of This Book
This book is arranged into two sections following this initial introduction.
Section One outlines in more detail over three chapters what we believe the most pressing challenges are. Sustainability, the Triple Bottom Line and Corporate Social Responsibility (CSR) are assessed in Chapter 2, where the wider impact of businesses and governments on society and the environment are discussed. Chapter 3 introduces the challenges of a circular economyâwhere we discuss the new model for our economic existence and the role of the accountant within that model. The last chapter in this section, Chapter 4 looks at the advent and progress of accounting technology. Here the proliferation of technology change is considered, Big Data , Cloud Computing , Artificial Intelligence and blockchain are explained and contextualised for the accountant.
Section Two, consisting of five further chapters, outlines accounting and businessâ responses to these external environment challenges. In Chapter 5 we cover âfairâ corporate tax strategies in the context of being perceived as a good corporate citizen. We look at how corporate reporting has developed beyond the numbers in Chapter 6 to include narrative that underpins the broader strategic focus of the company. Developments in auditing, along with what is expected of the audit function and the skills needed by future auditors are covered in Chapter 7. Chapter 8 recognises how firms need to adapt their performance management systems to account for their many diverse priorities, and finally Chapter 9 outlines how further skills development in accounting can help individuals to adapt to the ever-changing business environment, developing for example, âself-leadership â skills.
Our concluding Chapter 10 brings many of these issues together as we summariseâlooking at the way forward for the accounting profession beyond the numbers.
1.3 Who Have We Aimed This Book at?
This book differs from standard texts, in that chapters are standalone introductory pieces to provide useful precis of key topics and how they apply to the accounting professional in particular. It aims to deliver key readings on âhot topicsâ that are not addressed in other texts which the accounting profession is already tackling or are likely to need to tackle in the future. Hence the book provides accounting students with a good grounding in a broad range of highly relevant non-technical accounting themes which will impact upon their careers. It looks at the bigger ...