Big data, artificial intelligence, and blockchain are among the biggest technology trends in accounting and finance (Bernard Marr, “The 6 Biggest Technology Trends in Accounting and Finance,” Forbes Magazine, July 27, 2020, https://tinyurl.com/c9r6b9ar). CPAs need to be knowledgeable about technology topics for personal and professional development, especially considering that Congress introduced a bill to add accounting to the Science Technology Engineering and Math (STEM) education category (Cohn, Michael. “Bill Would Make Accounting Part of STEM Education,” Accounting Today, June 11, 2021, https://tinyurl.com/4zj53yrz).
Technology trends can encompass a multitude of different areas, such as data analytics, cybersecurity, robotic process automation, and blockchain. Because these areas have saturated all industries, learning more can promote personal development and help CPAs better assist their clients.
How do CPAs stay abreast of rapidly changing technology trends? Becoming familiar with various facets of technology will demystify the subject matter, overcome fear and hesitancy, promote relevant continuing professional education (CPE), and enhance CPAs’ ability to assist clients better. This article provides strategies for developing, promoting, or enhancing data analytics skills for individuals and organizations, at varying technology levels and fields, whether in education, public, or private practice.
Data Analytics Defined
The first step is to discuss the meaning of technology. Technology is defined as the “science or knowledge put into practical use to solve problems or invent useful tools” (https://tinyurl.com/pufjc3d4). One such example is the application of data analytics in business to gain additional information or to solve a problem. Data analytics uses technology to apply statistical analysis on data (information) to identify trends and solve problems (Thor Olavsrud, “What Is Data Analytics? Analyzing and Managing Data for Decisions,” CIO, February 8, 2021, https://tinyurl.com/hzknb7mm). For the purpose of this article, data analytics is defined as the process of gathering, sorting, and analyzing data to develop business solutions through technology tools. Hence, technology can assist CPAs with assessing abnormal trends related to certain accounts during an audit, consultation, or preparation of a tax return.
Importance of Technology and Data Analytics to the Profession
Whether it’s the education of future CPAs, updated CPA exam requirements, or gathering statistics to make informed business decisions, technology and data analytics are critical to the rapidly changing accounting profession.
Education of future CPAs.
For example, to address the changing needs of the profession, the AICPA and National Association of State Boards of Accountancy (NASBA) joined efforts to develop a task force to create the new CPA licensure model (CPA Evolution, https://www.evolutionofcpa.org/). This same task force also guided curriculum development to ensure future CPAs can meet the expectations of the profession. According to the Association to Advance Collegiate Schools of Business (AACSB), business schools that are accredited are required to demonstrate how accounting graduates and faculty have acquired information technology skills, agility, and knowledge (2018 Accounting Accreditation Standards, AACSB, https://tinyurl.com/vcshy67x). If business schools and newly minted CPAs will be required to learn new skills, firms must cultivate an environment where they can maintain and enhance their skills. Firms also need to provide training opportunities for current employees who may need this required knowledge to assist clients better.
CPA exam requirements.
The CPA exam has been revised to ensure candidates meet certain technical skills. Although the CPA exam has four sections (Auditing and Attestation, Business Environment and Concepts, Financial Accounting and Reporting, and Regulation) with multiple-choice, task-based simulations and written communication questions, candidates will also be tested on technology skills (“Learn What to Study for the CPA Exam,” AICPA, https://tinyurl.com/42jyexv2). With the CPA exam requiring new candidates to be knowledgeable in technology, firms will need to stay abreast of technology skills and trends.
Gathering and analyzing data in business.
In addition to staying abreast of how technology requirements have impacted education and CPA exam requirements, accounting professionals should also have a working knowledge of technology and its impact on business operations. Based on insights from Deloitte (“Tech-Trends 2021,” https://tinyurl.com/2p8awfh3), board members and C-suite executives should have a broad understanding of technologies that impact business operations to be successful. This implies that as auditors, key consultants, and accountants, CPAs should be as knowledgeable as essential stakeholders to provide the best consultative advice.
According to a Deloitte survey, in addition to continued adoption of robotic process automation, the top strategic priorities for organizations include focusing on continuous improvement, increasing the level of automation, and developing analytics capabilities [Anthony Abbattista, “Robotic Process Automation (RPA) Trends and Scaling Best Practices,” Deloitte US, Nov. 9, 2020, https://tinyurl.com/y6f5eetf].
Another example was illustrated in a survey by Transforming Data with Intelligence (Philip Russom, TDWI Best Practices Report Big Data Analytics, 2011, https://tinyurl.com/5uk7zvsa). In the TDWI survey, respondents ranked the benefits that would ensue if data analytics were implemented. The top seven benefits of data analytics include: better targeted social influencer marketing (61%), more numerous and accurate business insights (45%), segmentation of customer base (41%), recognition of sales and market opportunities (38%), automated decisions for real-time processes (37%), definitions of churn and other customer behaviors (35%), and detection of fraud (33%).
One recent example noted in another TDWI report is that artificial intelligence (AI) is reducing delays and creating more efficiencies in business processes (David Stodder, “Executive Summary: Evolving from Traditional Business Intelligence to Modern Business Analytics,” 2020. https://tinyurl.com/34wcwxd2). Gaining insight into what’s expected of future CPAs’ education requirements as well as identifying ways to learn about emerging technologies can strengthen CPAs’ technical skills. The purpose of this article is two-fold; to provide an overview of technology trends and discuss strategies on how to enhance technology skills.
Approaches Used to Incorporate Data Analytics Skills
The profession has responded in multiple ways to technology trends. For example, the state societies are offering more technology-related courses. The AICPA and NASBA have formed task forces to provide meaningful, relevant changes for the CPA exam. The American Accounting Association (AAA) offers courses on integrating technology into the accounting curriculum (https://tinyurl.com/ubhcz4c). Educational institutions are also incorporating more data analytics into courses and offering majors in data analytics. Some accrediting bodies like the AACSB require business schools to integrate technology into the curriculum and show how faculty members are proficient with technology. Finally, firms are using technology to become paperless and create communication efficiencies through technology tools (Andrew Kenney, “What Tax Firms Need to Know Now about Technology,” Journal of Accountancy, June 12, 2019, https://tinyurl.com/6dkepbxa). Firms are using machine learning in auditing to reduce audit staff, assist with internal controls, and improve fraud detection. Machine learning implemented in tax departments increases efficiencies with tax reviews and identifying new client services. Advisory services experience increased accuracy and identify added value services when machine learning is applied (Izhar Haq, Michael Abatemarco, and Jeffrey Hoops, “The Development of Machine Learning and Its Implications for Public Accounting,” The CPA Journal, July 31, 2020, https://tinyurl.com/2yp889wj).
Strategies to Boost Your Skills
The following is a review of strategies that CPAs can use to enhance their technology skills. Although each strategy will enhance your skills, the first strategy is perhaps the most important, being the start of one’s journey.
Familiarize yourself with technology and determine a path of study.
It’s best to become acquainted with key terms and areas of interest and determine one’s knowledge level (i.e., beginner or advanced). The first step is to develop a baseline understanding of general terms and concepts. This can include reviewing resources, attending workshops, classes, or even earning a certification. Once you determine the basics of data analytics, for example, and the areas of interest, you can determine the best strategy. Amir Gandomi and Murtaza Haider (“Beyond the Hype: Big Data Concepts, Methods, and Analytics,” International Journal of Information Management, vol. 35, no. 2, 2015, pp. 137–144. https://doi.org/10.1016/j.ijinfomgt.2014.10.007) note that data analytics encompasses the acquisition, extraction, aggregation, and integration of data from text, audio, video, and social media, applied to predictive analytics through modeling and analysis as well as interpretation.
There are also descriptive, diagnostic, predictive, and prescriptive analytics (https://tinyurl.com/hzknb7mm). There is value in each type of analytics, and CPAs need to determine the best type of analytics based on their needs, then focus their efforts on that area. For general technology and data analytics knowledge helpful to accountants, see Exhibit 1 for a sample of resources including websites, videos, certifications, and classes. Don’t forget the basics by brushing up on your Excel skills. One could become a “spreadsheet-nista” or “spreadsheetnosto,” which means becoming well versed with Excel. There are many free demonstrations at different levels on YouTube, as well as a free Excel crash course on financial analysis offered by the Corporate Finance Institute. For industry professionals or accounting educators, the American Accounting Association (AAA) has an ”audit boot camp” that covers data analytics and audit innovation, and current audit methodology and innovations. This boot camp experience can be useful to CPA firms looking for ways to integrate data analytics into their audit practice, learn new data analytics skills, and teach staff data analytics skills for audits.
Technology Skills and Resources
Although the authors are recommending ways to boost one’s technology skills, it is important to keep in mind that CPAs also need to understand overall business processes. For example, in order to better understand the business, Alteryx can assist with workflow mapping (https://tinyurl.com/yr8nz737). Alteryx can also help with conducting control testing and creating workflows. There are useful Alteryx videos on understanding data, creating a workflow, and analyzing data (https://tinyurl.com/3bc2upwk).
A few other technology tools that are helpful, whether one is in public practice, private practice, or academia, include Tableau or Power BI for data visualization. Tableau, which is Mac-friendly, has complimentary access for 14 days and a license for educators. Power BI provides data visualization and offers a free trial. For tools to assist with audits, IDEA and ACL can access data trends and statistics for sample selection planning and other analyses. Finally, it is crucial to note that some of the tools mentioned are not Mac-compatible.
The AICPA has a wealth of technology resources for members and nonmembers alike, collected in Exhibit 2, AICPA Technology Resources. For example, its Guide to Audit Analytics (https://tinyurl.com/34u46sc2) provides a comprehensive look at how audit analytics can be used in each step of the audit. The AICPA offers certifications in data analytics, blockchain, cybersecurity, robotic process automation, and the Advanced SOC for Service Organizations Certificate program. The AICPA has various technology programs and certificates such as a data analytics executive series (5-hour web-cast), Data Analytics Certificate programs (61 CPE credits plus five digital badges when you complete all five certificates), Blockchain Fundamentals for Accounting and Finance Professionals Certificate (12 or more hours), Cybersecurity Certificate programs, robotic process automation (RPA, 14 hours), Fundamentals for Accounting and Finance Professions Certificate program, robotic process automation strategy for business leaders, and the Advanced SOC for Service Organizations Certificate Exam.
AICPA Technology Resources
Other notable resources include the cybersecurity risk management reporting fact sheet (https://tinyurl.com/yx4ycsaw) and the illustrative cybersecurity risk management report (https://tinyurl.com/v9shnty5), which provides required key elements of a report when assessing cybersecurity at an organization and sample cybersecurity report for professionals to use in practice for clients. The AICPA also has a course in analytics and big data for accountants covering the history and latest trends.
One of the highly sought-after certifications is the Certified Information Systems Auditor (CISA) certification. CISA certified individuals can provide a high level of information technology expertise to clients during an audit or for business consulting services. Finally, the AICPA offers the Certified Information Technology Professional (CITP) certification, which tests whether skills were mastered in information security and cyber risks, business intelligence, data management, and analytics, information technology governance, and risks and controls. If the CISA certification offered by ISACA.org is passed, the exam and the requirements for the CITP can be waived because the content for the CITP is covered on the CISA exam.
Join an organization.
Consider joining a new association and taking advantage of all the resources available through existing memberships. Joining the organization can place one in close proximity to technology resources such as articles, classes, and other technology professionals, which can be a valuable asset as one enhances their technology skills. Various organizations include ISACA (https://tinyurl.com/7dnf3kzk), state CPA societies, the ACFE (https://tinyurl.com/pnna6vuw), and the AICPA (https://tinyurl.com/estzc2tc). While attending conferences, classes, and events, focus on developing informal and formal relationships with technology experts, academics, and industry key persons.
Another option is joining the Transforming Data With Intelligence (TDWI) program, which has individual, team, educator, student, young professionals, and executive membership options. Consider enrolling in training classes, participating in summits, and or conferences. After completing each course, one can earn a certificate and digital badge or free virtual events (https://tinyurl.com/y9wfh9u4). The badges can be displayed on LinkedIn, a website, or a resume.
Incorporate data analytics into firm training.
Periodically throughout the year, staff training can include technology seminars onsite to keep staff knowledgeable of trends relevant to their industry or area of expertise. CPA firms can design specific training for departments. For example, audit employees can complete a course on the new audit software available and how IDEA can assist with identifying anomalies during the planning stages of the audit. Another option is to require staff to complete a certain number of courses, whether online or in-person, in technology each year. Also, consider investing in robust, specific technology training (i.e., certifications) to have in-house experts. Firm recruiters can strategically pursue new hires to serve as an in-house resource. For example, several Master of Accountancy programs include specialized data analytics tracks. The advantage for firms in securing graduates of these programs is that these professionals bring a new skill set to the firm and permit a transfer of knowledge when staff work on projects together.
Hire data analytics professionals or hire a consultant on an as-needed basis.
It’s important to recognize that small firms with constrained budgets may not have the financial resources to train all team members. Having at least two technology professionals available is a sound plan. These professionals can include a CISA-certified and other content-specific professionals who can be called upon on an as-needed basis. With some flexibility of available technology professionals, firms can extend their data analytics expertise to meet client needs without overburdening the budget. Such a firm is also better positioned to determine which data analytics and technology skills identify to prioritize for future firm training. Furthermore, the continued use of a consultant may signal the need for a shift in resources.
Be comfortable with continuous learning.
Nothing stays the same, and technology has shown the accounting profession that continuous learning is critical to stay relevant. One way to receive continuous information is to set Google alerts to receive newly published articles on relevant topics. Another way is to attend an annual technology trend update conference offered by the state society. At the end of the day, CPAs can’t be afraid to test technology tools.
Making the Commitment
With a commitment to continuous learning, CPAs can stay engaged with technologies that impact the accounting profession. When CPAs stay abreast of technology trends, they can grow personally and professionally, enhance data analytics skills, and solve business problems for clients more efficiently. Rapidly changing technology trends impact all facets of accounting, from public and private practice to academia. The strategies and resources discussed above can serve as a guide in enhancing educational growth.