Accounting Profession Must Initiate Changes to Keep Pace in 1992
Hill, Daryl J., THE JOURNAL RECORD
Accounting Profession Must Initiate Changes to Keep Pace in 1992 The accounting profession serves the public interest in a rapidly changing environment. Increased globalization, technological developments, and unyielding competition are all changing the face of business.
To survive in this new environment, the accounting profession will be forced to initiate changes, or fall behind non-accounting organizations through a widening public expectation gap.
It will no longer be enough for certified public accountants to keep up with the complex changes of their profession itself. Instead, economic, demographic and technological changes will create pressure for profitability in the accounting profession and intensify challenges in serving client interests.
Increases in international trade and greater international investments, as well as other signs of globalization, will permanently advance the accounting profession.
As more and more companies engage in international operations, the CPAs that serve them will expand their expertise to include the international arena. This will create greater educational challenges for candidates entering the accounting profession as well as those already practicing.
As the profession faces the increasing responsibilities of a global economy, it will be necessary to address such issues as international reciprocity, harmoniza- tion of the content of financial state- ments, and international accounting and auditing standards.
Given the technological developments and the information needs of our society, CPAs will become more involved in information technology. In order to remain competitive, firms will have to acquire access to technological developments such as telecommunications, computer networks, expert systems and artificial intelligence. This technology will have an impact on the necessary knowledge and skills as well as the nature of services provided by CPAs.
Not only will major changes in the education process be necessary to adequately prepare accountants for entry into the profession, but CPAs and accounting firm personnel will also be required to maintain training in information technology.
CPA firms will continue to have an increasing need for capital to make the necessary investments in technology and related training. As an alternative to heavy capital investment, however, some accounting firms will choose to specialize and practice in narrow areas depending on the firm's size and the background and training of its personnel.
Technology also holds implications for organizational structure within
accounting firms. As the need expands for more experienced personnel, there will be a move away from the traditional pyramid shape of the accounting organization.
Ultimately, the specialized skills necessary to deal with technological developments will create greater opportunities for non-CPAs to become associated with CPA firms.
In addition, technologial advances and changes in the international arena will create new managerial challenges for accounting firms. Capital needs and pressure on profitability will cause firms to seek manageable ways to offer a variety of services, such as through networking among firms or mergers.
Technology will have an impact on all areas of accounting firms, but it will likely have its greatest impact on how, when and where attest engagements are