As digital transformation becomes ubiquitous, corporations and firms have digitized business processes at record speed, especially during the COVID-19 pandemic. Disruptive technologies, such as robotic process automation (RPA), artificial intelligence (AI), blockchain, cloud computing, and advanced analytics, promise to improve efficiency in completing tasks and making decisions. This current wave of automation suggests that technology will significantly impact professional occupations.

Accountants are using this alphabet soup of applications, including Enterprise Resource Planning (ERP), Power BI, and R, as well as decision support tools, such as Excel, Tableau, and Alteryx. Unfortunately, many accounting students are not prepared to properly use, implement, or maintain most of the technical tools used today. Many college students do not possess a solid functional footing in Excel, let alone the vast array of the other tools mentioned above. Students who do not have a strong foundation in basic technical concepts and tools will struggle to be relevant in today’s business world. As such, research from the AICPA (“Trends in the Supply of Accounting Graduates and the Demand for Public Accounting Recruits”) suggests that employers have begun to hire from other more technical undergraduate degree fields, such as management information systems (MIS), instead of accounting graduates.

Another concern is automation itself. The automation of repetitive and redundant tasks yields increased speed and lower costs for many organizations, as 25% of all U.S. jobs are predicted to have high exposure to automation (M. Muro, R. Maxim, and J. Whiton, “Automation and Artificial Intelligence: How Machines Are Affecting People and Places.” Brookings Institute, 2019. Regarding the accounting profession, 50% of accounting operations can be automated through currently available technology, and an additional 15% can be automated through emerging technology (J. Manyika, S. Lund, M. Chui, J. Bughin, J. Woetzel, P. Batra, R. Ko, and S. Sanghvi, “What the Future of Work Will Mean for Jobs, Skills, and Wages.” McKinsey Global Institute, 2017). There is a high probability that rudimentary payroll, bookkeeping, and reconciling tasks will soon be eliminated due to their routine, repetitive nature. Given the pandemic and its related impact on the marketplace, accounting firms and corporations have re-evaluated their reliance on human capital. College students will increasingly need to demonstrate their higher-order thinking skills in order to secure employment. Students’ technological skills deficiency has two root causes: a lack of student preparedness in basic digital literacy and critical thinking skills, and a lack of appropriate digital literacy in the accounting curriculum at most universities.

Student Concerns

Arum and Roksa found that only slightly more than half of students at American colleges improve critical thinking skills from the high school level, based upon the College Learning Assessment (R. Arum and J. Roksa, Academically Adrift: Limited Learning on College Campuses, University of Chicago Press, 2011). College students are often subjected to the same rote learning as they were in high school, which is still predicated upon preparing students to perform repetitive tasks, including factory work (R.A. DeMillo, Abelard to Apple: The Fate of American Colleges and Universities. MIT Press, 2011), instead of higher-order thinking and analyses required in today’s workplace. Therefore, when college students attempt to engage in critical thinking activities, they tend to provide flawed answers or answers that address different problems than the ones they were asked to solve.

As professors, the authors have observed deficiencies in basic digital literacy among our business students over the years in terms of students having difficulty classifying data and data types, understanding basic structured logic and coding concepts, and discerning the interrelationship of business processes and their supporting technologies. Undergraduates are savvy when it comes to social media, but these multi-media skills do not easily correlate to data interrogation skills. New hires are now expected to apply higher-order thinking as they interrogate data files to assist with decision making. The CPA Evolution initiative reinforces the need for newly licensed accountants to possess strong analytical, technical, and critical thinking skills.

Faculty Concerns

Accounting faculty may require extensive training to increase their technical skills to meet expectations of the profession’s current standards or continuing education to maintain their proficiency. A recent study of accounting professors (R.L. Cardwell, R.O. Cardwell, J.T. Norris, and M.P. Forrest, “The Accounting Doctoral Shortage: Accounting Faculty Opinions on Hiring JD-CPAs as Accounting Educators,” Administrative Issues Journal, vol. 9, no. 1, p. 3, 2019) provided a demographic sample which reported that 60% of current accounting faculty are older than age 55 and have more than 10 years of academic teaching experience. This suggests that experienced faculty may have a steeper learning curve regarding new technologies and data analytics skills. In addition, accounting faculty may be unaware of how accounting is currently undergirded by technology or what newly licensed accountants need to know about technology to complete their daily tasks. University budgets, especially those with limited external support, may not be able to provide the extensive initial training or the ongoing training necessary to maintain faculty competency consistent with current trends and expectations. Examples of such interventions include Deloitte’s Trueblood Faculty training with case-based instruction and KPMG’s sponsorship of several data analytics-focused master’s programs.

Views from Industry and the Profession

Several downward trends beginning in the mid-2010s suggest the profession is in a transition period with regard to acquiring talent that meets the demands of the modern business world. In terms of public accounting firm hiring information, the overall number of new hires has remained the same since 2014. In 2016, however, the overall number of new hires consisted of 19% fewer accounting graduates than in 2014; in 2018, this number of new hires consisted of 29% fewer accounting graduates. The skill-sets needed to complete firms’ professional services lend themselves to other, more technical degree holders. A PricewaterhouseCoopers white paper (“Data-Driven: What Students Need to Succeed in a Rapidly Changing Business World,” 2015) suggests that accounting curricula need to change to help students adapt to rapidly changing business environments. This white paper mentions that graduates need to possess the knowledge to use big data in decision making, apply control frameworks, clean data, comprehend database acumen, visualize data, and demonstrate strong computing skills.

The CPA Evolution Approach

The CPA Evolution Project was launched to change the CPA licen-sure model to recognize the new skills and competencies needed for today’s accounting profession. The CPA Evolution will require each candidate to have a basic understanding of business processes, the integration of technology with business processes, accounting procedures, and internal controls, as well as how to collect and organize data to derive helpful conclusions and valuable insights. The new licensing exam will consist of two sections: 1) the core and 2) a specialization. The core will be a three-part exam within the areas of financial accounting, audit, and taxation.

Each candidate will choose a specialization area of either business analysis and reporting, information systems and controls, or tax compliance and planning as the fourth part of their exam. CPA candidates will need strong critical thinking, logical thinking, and advanced data analytics skills. In addition, a newly licensed CPA will possess more in-depth knowledge of information technology and risk assessments because information technology will be incorporated throughout the CPA core, and a specialization section that may be selected may be either information systems and controls or business analysis and reporting. (This article will not address tax specialization, because the authors believe universities have addressed the complexities of various tax concepts by implementing additional tax courses within their current curriculum or creating tax specializations within their master’s program. It is essential, however, to note that critical thinking, logical thinking, and data analytics skills will be tested within the tax core and tax specialization areas.)

The CPA Evolution Model Curriculum has been made available by the AICPA/NASBA task force (2021). It aims to address the skills gap for new accounting graduates. The following discussion concerns the model curriculum’s perspective on the area of technology. The author’s emphasis is on skills as opposed to accounting courses. The following discusses potential knowledge gaps (i.e., critical, logical thinking and advanced data analytics, digital acumen) for accounting students. The Exhibit lists the proposed sections of the CPA Evolution exam where these skills will be tested, as well as to aid students and faculty in addressing these knowledge gaps.


List of CPA Evolution Section and Related Resource per Skill Exam

 Critical Thinking; Logical Thinking; Digital Acumen CPA Exam Section; Core ▪ Accounting and data analytics ▪ Audit and accounting information systems; Core ▪ Accounting and data analytics ▪ CPA specialization ▪ Business analysis and reporting; Core ▪ Accounting and data analytics ▪ Audit and accounting information system ▪ Tax specialization ▪ Business analysis and reporting Resources; ▪ Business Cases—Harvard Business Review and Deloitte Trueblood ▪ Processing mapping exercises—various textbooks exercises; ▪ SAP University Alliance for access to SAP and curriculum ▪ Tableau ( ▪ Python ( ▪ Object-oriented language ( ▪ This Way to CPA ( ▪ SQL ( ▪ Amazon Web Services (AWS Educate) ▪ IBM Academic Initiative ▪ Microsoft Learn for students ▪ LinkedIn Learning

Critical Thinking

It is often argued that the skills essential for critical thinking include communication, problem solving, and self-direction; therefore, incoming accounting students should possess a quantitative mindset and demonstrate a proclivity for unstructured problem solving (i.e., an affinity for word problems). Unstructured word problems require students to read the facts, think about what is being asked, determine a method to solve the problem, and then perform the selected set of steps to obtain the solution. Critical thinking in the curriculum would require accounting faculty to move away from teaching accounting through a rehearsed set of steps of how to calculate a number, to using case-based instruction whereby students must apply accounting principles to an unstructured set of facts and figures. Accounting faculty will not only need to teach those steps. They also provide students with real-world scenarios; hence, students must be able to think through the case facts, identify the relevant facts that are needed to address open-ended case questions, and communicate their judgment based on their analyses. In addition, students must be able to participate in peer collaboration, reflect upon case questions, and discuss various conclusions. The development of student critical thinking skills provides students with an opportunity to more fully comprehend an organization’s IT governance structure and participate in risk assessment discussions to better understand and document internal controls within business operations and within data. (See the Critical Thinking section in the Exhibit for more on its place in the CPA Evolution and resources available to students and faculty for skill development.)

Logical Thinking

Logical thinking skills represent the ability to use basic programming logic to identify patterns in financial data. These should form the basis of developing relevant analyses to address questions and solve problems. Logical thinking can be developed through coding, as it builds digital acumen and problem-solving skills. The introduction of this technical acumen to accounting students aligns with the new Accounting STEM Pursuit Act bill, which aims to establish the accounting profession as a STEM career [introduced on June 11, 2021, by Representatives Victoria Spartz (R-Ind.) and Haley Stevens (D-Mich.)] to attract more diverse students to the profession, emphasis is placed on grants for the K-12 curriculum in technology and accounting. If and when accounting practice becomes a STEM career, K-12 students who participate in STEM programs will be exposed to coding, problem-solving activities, and critical thinking projects as they become aware of the profession.

As technology changes over time, faculty need to commit to at least one programming tool, given constraints regarding student contact hours. Any programming language (e.g., visual basic, C++, or Python) will suffice. Universities’ accounting curricula, however, need to ensure that their graduates are proficient in a tool from the following five areas: a spreadsheet (i.e., Excel), a database (i.e., Access), statistics software (i.e., R or SPSS), visualization software (i.e., Tableau, Alteryx), and ERP (i.e., SAP, NetSuite). The overall goal is to ensure students understand how to manipulate and interrogate data as well as communicate their results, regardless of the technology tools. (See the Logical Thinking section in the Exhibit for more on its place in the CPA Evolution and the resources available.)

Digital Acumen

Digital acumen is the ability to mine and interpret multiple data sources in order to make more accurate business decisions faster. Digital acumen also includes optimizing business processes and functionality by converting them to a digital process. Digital acumen integrates accounting students’ critical and logical thinking skills with their ability to extract, transform, and load data to make informed decisions. Newly hired accounting graduates are expected to obtain a client’s data sets; scrub the data set by amending or removing incorrect, incomplete, improperly formatted, and duplicated data; and then perform descriptive and predictive statistics and data visualization as their observations. Furthermore, accounting students should have a high-level understanding of the essential tools employed (i.e., spreadsheets, visualization tools, statistical analyses) that enable this type of work to be completed. Accounting faculty will need to incorporate more data-driven projects within their courses to provide students with practical experience with data scrubbing, search for abnormalities, and develop and interpret charts and graphs. (See the Digital Acumen section in the Exhibit for more on its place in the CPA Evolution and the resources available.)

Closing the Gap

By changing the curriculum to emphasize business processes, decision making, judgment, and technology, the skills gap for new accounting graduates should be eliminated. New accounting graduates will be more prepared for their profession and add value to the organizations they join. The use of cases, projects, and case competitions earlier in the accounting curriculum will allow accounting students to learn and practice these skills before graduation. It is essential for accounting students to improve their higher-order thinking and critical analysis skills; therefore, accounting faculty should introduce ambiguity and professional judgment into the classroom and move away from absolute, quantifiable answers. In addition, accounting courses should use business processes as context to reinforce critical accounting concepts and processes. The use of business cases and business processes allows accounting principles to be taught from a cross-sectional perspective instead of from traditional business silos. It also allows a professor to address the interdependences of information technology and accounting practices.

Brandis Phillips, PhD, CPA, is an associate professor of accounting at North Carolina A&T State University, Greensboro N.C.
Nicole McCoy, PhD, CPA, is an assistant professor of accounting at North Carolina A&T State University, Greensboro N.C.