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Reimagining the profession for a vibrant future

Barry Melancon, CPA, CGMA, President and CEO of the American Institute of CPAs (AICPA) and CEO of the Association of International Certified Professional Accountants (the Association), reflects on the successes of 2019 and the opportunities ahead.

This year, you’ve talked with members about how we need to reimagine the profession. Can you explain more what you mean by “reimagine”?

In today’s marketplace, virtually all companies are reimagining who they are, what they offer and how they deliver services and products. To meet the changing needs of clients and employers, we, as a profession, are also reimagining what it means to protect the public interest and serve as trusted advisers. We are providing clients and companies with new services and embracing new technologies to enhance the quality, efficiency, and value of what we do. Together, we’re creating a future that may be dramatically different from the past but will remain a beacon of trust and opportunity for all accounting and finance professionals and everyone we serve.

How specifically are the AICPA and CIMA, under the umbrella of the Association of International Certified Professional Accountants, helping the profession reimagine itself?

Four major initiatives immediately come to mind:

CPA Evolution, which is a joint effort of the AICPA and the National Association of State Boards of Accountancy (NASBA), aims to transform CPA licensure to recognize the skills and competencies required of CPAs today and in the future.

Our CPA Exam practice analysis research will guide our update of the CPA Exam. We focused this year’s research on technology’s impact on the work of newly licensed CPAs and on firm recruitment and training.

The AICPA, CPA.com, CaseWare International and leading CPA firms in the U.S. are collaborating on the Dynamic Audit Solution (DAS) initiative to develop a data-driven, technology-enabled audit methodology that will enhance the efficiency, quality and value of audits. In the future, the DAS software application will be available to the more than 14,000 firms that have auditing practices in the U.S.

Our Future of Finance research guided our updates to the CGMA Competency Framework and CGMA Finance Leadership Program. Based on consultation with more than 5,500 finance professionals from 2,000 organizations across 150 countries, our research shows a movement away from a focus on assembling information toward delivering impact, as finance professionals partner with internal clients across an organization to lead business transformation.

Technology has played a large part in these initiatives. Can you give an example of a specific technology that is changing the profession?

Although some may not feel its impact yet, blockchain has the potential to transform audit, tax, accounting, and advisory services. As more companies use blockchain, they will need trusted advisors who understand the technology and can provide guidance.

For example, companies such as Walmart now require some of their suppliers to be active on a blockchain. This means auditors of those suppliers will need to consider whether the information on that blockchain is accurate, reliable and secure and whether the smart contracts within the blockchain are operating as intended. (To learn more about Walmart’s use of blockchain, you can join a webcast later this month or in January.)

The same type of questions will apply to blockchain’s use in supply chains at other companies in other industries. To help auditors understand risks associated with the use of a blockchain and how service auditors might address them, the AICPA will release non-authoritative guidance in 2020. For questions related to digital assets, we developed a non-authoritative practice aid for accounting and auditing guidance and are seeking greater clarity from the IRS and Treasury on how taxpayers should report cryptocurrency on their taxes. Additionally, CPA.com is hosting a free webinar in January to help tax practitioners navigate the complexities of cryptocurrency tax compliance.

A newly released report on the 2019 Blockchain in Accountancy Symposium provides insights from experts, as well as an assessment of the opportunities and challenges blockchain, poses for the profession. To help members prepare for blockchain’s impact, our foundational certificate program for finance and accounting professionals explains blockchain fundamentals. We also offer blockchain learning focusing on the practice areas of audit and assurance, tax and financial advisers, as well as industry-specific learning for supply chain, financial services, healthcare, insurance, and not-for-profits.

In addition to technology, in what other areas did we see change for the profession in 2019?

Tax reform

Tax reform was a key issue for members this year, causing sweeping changes in tax preparation and compliance. We focused federal advocacy efforts on the implementation of the Tax Cuts and Jobs Act, submitting 40 comment letters over the past year and meeting with dozens of IRS, Treasury, and Chief Counsel staff members to highlight key issues and provide practical recommendations. For our members, we provided timely and relevant resources via our Tax Reform Resource Center and Tax Season Resources hub.

Although challenging, tax reform has also provided an excellent opportunity for members to engage with clients in a new way and offer a holistic approach to their financial needs. We are here to help tax practitioners seize this opportunity to integrate planning into their practice. We released our Tax.

Standards

The AICPA offered information and resources on auditing and attestation standards issued in 2019 to help members stay on top of change. On the accounting standards front, we also issued a new toolkit that breaks down the new revenue recognition standard and provides firms with insights into how the standard will affect firm engagements.

Valuation credential

To address a growing need for consistency and transparency in the valuation of financial instruments, the AICPA launched the Certified in the Valuation of Financial Instruments (CVFI) credential this year.

Occupational licensing

Legislators across the country are looking at ways to deregulate occupations to reduce barriers to entry. While this legislation doesn’t call out CPAs specifically, it often — unintentionally — pulls us in because it’s written so broadly. As part of our advocacy efforts to protect occupational licensing for the profession, we took the lead in organizing the newly-launched Alliance for Responsible Professional Licensing, a coalition to promote support for rigorous licensure standards for complex, technical professions that impact public safety and trust.

As a year marked by change comes to an end, do you have any reflections you’d like to share with members?

First, I’d like to thank our members for their support and participation in advancing the profession for continued relevance and success. Their commitment to the profession and to lifelong learning is inspiring. I regularly meet members who are embracing the need to upskill and reskill, ready to leave behind what no longer serves them and embrace new tools and competencies to protect the public interest and help clients and employers navigate a complex, rapidly changing world.

Not only do technological advances provide CPAs with more tools, but these advances also free up time for CPAs to focus on work beyond the day-to-day grind of data entry, compliance, and other repetitive tasks. Recognizing the opportunity and need, firms and finance teams are making the conscious decision to shift into roles that are even more strategic than those held in the past. With this shift, the very definition of what it means to be a CPA is under review. Although this uncertainty may be unsettling, it’s also exciting to see the profession increase its already-strong impact on the marketplace. 

Inventor Nikola Tesla said, “The present is theirs; the future, for which I really worked, is mine.” We, too, must work for the future, claim it as ours and reimagine new possibilities for the profession. The future depends upon us.

Courtesy: AICPA

About Simandhar education

Simandhar is official partners of Becker and AICPA, offices in Bangalore, Hyderabad, Delhi, Ahmedabad Gurgaon, Kerala, Cochin (Kochi), Trivandrum, Kottayam, Kozhikode, Malappuram, Chennai and Mumbai

 

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