By Owen Mavengere
BUSINESSES have relied on the services of an accountant, or at least have had to do some sort of accounting. This could be a simple income versus expenses statement to consider “how much the business is making”. The quotation marks are deliberate, because a simple income and expenditure statement cannot adequately respond to that question.
Key accounting concepts of cash versus accrual as well as the statement of cash flows are required to adequately respond to that question. Important principles of cash accounting and accrual accounting come to mind. However, the differences between the two requires a full article to adequately explain.
Every business micro, small, medium or large requires accounting. In a previous publication, there was extensive coverage on the external accountancy services, and in this article we dwell on the internal accountant.
Most medium and large organisations have a fully-fledged accounting department, led by a head of the accounting department. The title of the head of the finance function of any organisation differs. Examples include, Financial Controller, Finance Director, Chief Finance Officer and Finance Manager.
The accounting function
Traditionally, the finance function has been responsible for the full range of financial management processes including data capture, classification, report preparation, treasury management, debtors’ and creditors’ management, etc.
There have been exponential developments occurring with regards to accounting systems/packages and more recently the advent of neural networks and artificial intelligence (with all its subsets like expert systems, deep learning, machine learning, robotics, machine vision, etc.).
Technological leaps and bounds resulted in a situation where some of the skills of yesteryear have no place in the future. At the moment we talk of the fourth industrial revolution or 4IR.
The technology that is now available on the market can perform most of the basic functions that were done by a team of clerks and accountants, and at times in a fraction of the time, with the added bonus of less errors. This then begs the question, is the accountant still relevant today and will they be relevant in the future?
Some professional bodies such as the Institute of Chartered Accountants of Zimbabwe (Icaz) are over 100 years old and thus have seen seismic shifts and navigated the same. Icaz was formed a few decades after the second industrial revolution and over 60 years before the third.
Other Professional Accounting Organisations (PAOs) that are in Zimbabwe have also been around for decades and thus have had to also navigate the changes that occurred.
Adapting to changes
The secret of the accounting profession that has allowed it to survive all the revolutions and shifts in technology has been resilience through the ability to adapt. Accountants have managed to harness technology each time it has changed.
The third industrial revolution saw the internet come into play and this has made the life of accountants much easier as opposed to being taken as a threat.
The current age of artificial intelligence and the blurring of the physical and cyber divide will also provide opportunities for accountants, because of the opportunity to progress the profession. The technology will be used to perform mundane tasks and free up time for the accountant to focus on strategic financial management issues.
Steps to prepare for future
The Icaz project is a case in point for how the local profession is taking strides to stay ahead of the changes. The accountancy profession continues to strive to keep abreast with global developments.
The purpose of the Icaz’s Future Fit Accountant project is to imagine the future roles of the profession, single out the most relevant issues that are faced as well as determine which competencies are pertinent for the future.
Prior to getting started, research was conducted in Zimbabwe and South Africa, with market wide surveys as well as face to face interviews with a broad spectrum of stakeholders, which included employers and recruiters, to obtain their views about what will be required of the future professional, in particular the future chartered accountant (CA).
The extensive research done resulted in the following broad areas being identified as key areas of focus in the competency reviews:
- Critical thinking — the dynamic environment that is currently subsisting requires a professional that can think outside the box to come up with unique ideas to resolve existing and novel challenges. A questioning mind-set is required as the basic task of providing data or information would already be done through automation. Emphasis will also be on decision making and judgment.
- Business acumen — value creation will be key for the various stakeholders that rely on the professional accountant. Innovation and creativity are key factors that will play an integral part of shaping the role of the Future Fit Accountant. This will be a long way away from the bean counting days.
- Ethics — given how central any accountant is to decision making and being privy to critical information the importance of ethics cannot be overemphasised. This area is of paramount importance especially in our country which is actively trying to combat the scourge of corruption, which some have fittingly termed a cancer eating away at our society. Ethics are the bedrock of the performance of the accountant of the present and of the future. All the positive changes and updating of the profession will come to nought if the moral fibre of the professionals is not strong.
- Technology and digital acumen — this is now very key as technological leaps and bounds are now the norm as already alluded to. Covid-19 has seen us go through an emotional roller coaster, from losing loved ones, to seemingly endless lockdowns. Even when it is finally conquered, the effects on the working environment and the somewhat forced adoption of technology will remain. Covid-19 has accelerated the uptake of technology and the effect of artificial intelligence will both be key factors which the professional will need to be ready for. Key areas of focus include cyber-security, big data, data analytics and so on.
The local Icaz Future Fit Professional Accountant will produce a professional who is not only ready for the future, but ready to be a well-rounded business leader riding on technology.
- Mavengere is the technical manager at Icaz, which is the largest and longest standing PAO in Zimbabwe, having been established on January 11, 1918, and is a body corporate incorporated under the Chartered Accountants Act (Chapter 27:02). Icaz provides leadership on the development, promotion and improvement of the accountancy profession focusing in the areas of accounting education, assurance, good governance practices and leadership and organisational excellence. — technical@Icaz.org.zw or Twitter: @OwenMavengere.