Accounting Influencers Roundtable

Accounting
Influencers
Roundtable

Accounting Tomorrow: Preparing for Transformative Changes

The Accounting Answers Podcast, hosted by Rob Brown, asks critical questions of the experts, leaders and influencers who shape the decision-making of accountants, CPAs and finance professionals. Today we ask:

What, if anything, will significantly change accounting in the next few years?

You’ll hear insightful and passionate answers from these 5 experts and influencers:

Jeff Gramlich | CPA, Head of Accounting at Validis and 40-year industry veteran

Jeff Phillips | CEO of Padgett, Founder of Accountingfly and accounting talent expert

Jeff Seibert | Angel Investor and Co-founder and CEO of Digits, accounting reimagined

Jennifer Warawa | President of QuickFee North America, accounting thought leader, fintech executive

Jeremy Clopton | Upstream Academy’s Managing Director, leading transformational change in firm leaders

Tune into more on this daily show for short, sharp episodes that keep you informed of what’s happening in the accounting world and the whole ecosystem of consultants, organizations, vendors and advisors who serve them.

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Transcript
Rob Brown:

Hi, I'm Rob brown and welcome you. Accounting finance professionals, tech enthusiasts to the accounting answers podcast. We've embarked on a captivating exploration of the future of accounting and its profound connection to the ever-changing technology ecosystem. I think for a moment, how access to the minds of a range of accounting experts, influencers, vendors, and leaders would keep you super informed about what's going on in this wonderful profession. You'd stay relevant and future focused. You'd make better strategic and career decisions. If you know what forces are in play and what factors are driving change. To unravel the complexities unenviable future of accounting. I've personally interviewed 111 leading accounting professionals, tech leaders, and industry influencers, each bring in their unique. Expertise and insights to the table and together we'll delve into the five critical questions that will shape the accounting world. Through the eyes and minds of people living their accounts in life. I'll talk into accountants every day. We'll talk about five critical topics that ignite in passionate debates and stimulate minds across the globe. We're mapping the transformative trajectory of the accounting profession and its symbiotic relationship with the technological revolution. We'll be asking about the next gen accountants, how far down the advisory line firms are. What's going to change the accounting world. What their software vendors and tech providers could do better to serve accountants. And what's coming up in the future. Let's get straight into the answers for today's topic. Oh this week, we're asking the question. What, if anything will significantly change accounting in the next few years? What changes are on the horizon? A few doubt that weren't to go in seismic shifts propelled by technological and basements, the rise of innovative business models. And the ever evolving regulatory landscape and this dynamic environment presents many questions, challenges, and opportunities that demand our attention. It's good to stay informed. So let's dive into here, what our experts have to say. I'm thrilled to introduce Jeff gremlin. CPA head of accounting at Valdez and a 40 year industry veteran. Who's dedicated his career to enhancing the reliability and efficiency of financial reporting and analysis.

Jeff Gramlich:

Ongoing regulation. That'll change it. and so maybe, an ongoing, government and legislative demands whenever there's more money moving, whether it's through a business, or through a service, you have to think through who all wants a piece of that action. And so that complexity, the Is going to require new things, for the accountant. I was just talking last week with some folks about lease accounting. And if you haven't done lease accounting before the rules used to be pretty straightforward, they're not so much anymore and they're very involved. And if you haven't done a lot of. lease accounting yourself as a CPA, you haven't done it. And so there's constant things like that. And that's for two reasons. One, for the investing public that really relies on us to, to issue an opinion and be independent of management and be independent of the company. In fact, in appearance, it's important that we, make sure that what the company is revealing to the public financially is true and accurate to the best of our abilities. Right? so I think with increased regulation. Typically, Rob has always come increased complexity and some of these rules just have to be looked through at a granular level. And the client doesn't have time to do that. And a great example of that was, here in the States when COVID hit and we had the, uh, the payroll protection plan, PPP, as it was called here, There was a process for applying for the money, which some of the accounting firms helped their clients do. There was a process for usage of the money and tracking, what the accounting firms also helped them do. Track where the money actually got used. And then when we started forgiving paybacks of the money, There was yet a third process for getting forgiveness of that, of which the accounting firms helped them do. So that's just one recent kind of a broader public type example where the CPA got very involved to help their client do that, and in some cases, keep their business open. we knew what the word pandemic meant prior to 2020. I'm not sure most of us ever said it much, or even thought about it much because it was something that happened. A long time ago, and we just didn't, it never came up. but, Bloyd came up in, in 2020 from March onward, and we still talk about it. And I know it's in the rearview mirror for the vast majority of it, but we still think about those things, and people are already planning, okay, what if this happens again? What do we need to do differently? And so that kind of forward thinking is very important. And, we've got some, and, Some global conflicts that we didn't have a few years ago. I'm not trying to get political here, but we do. We've got some wars going on different parts of the world and things have to be thought about differently from going concerned from, from the ESG perspective, right? And that's where the CPA frequently can

Rob Brown:

welcome to Jeff Phillips CEO of Padgett, founder of accounting flight and accounting talent expert. Who's revolutionizing the way accounting firms attract and retain top talent in a competitive market.

Jeff Phillips:

What's going to change accounting in the next few years? And I'm coming from the perspective from Paget, where we work with firms in Canada and the United States that are smaller and serving small businesses. But I think across the global profession, remote hiring. Is going to be a major change that we're going to see in accounting. I believe that in the coming years, 50 percent of hires. Will be from, staff that work in your country, but they can work in a different city than where your main office is. And when owners and partners begin to embrace this work from anywhere concept, they'll realize that they can find somebody in a matter of weeks, not months or years. Another change is offshoring and that's a little bit more embraced, but there is. Much more room to grow, and I think we're going to see a greater adoption of offshoring tax accounting and payroll work to other countries where you might take advantage of labor costs. Obviously, you're going to see more automation and AI. I think there's plenty of people that are going to talk about that topic, but what I get excited about is where can businesses. Automate routine tasks over and over again. There are so many software products globally that give accountants the freedom to do that. So you're finding another resource you can delegate work to and these changes are going to ultimately lead the accountants to be proactive, to be advisors, to have desktop alerts that will notify them when issues might come up for a client that they can get in front of the client and let them know. These are three changes I see happening rapidly over the next few years.

Rob Brown:

Let's explore the ideas of Jeff cybered angel investor and co-founder and CEO of digits, where accounting is re-imagined through technology, offering innovative solutions that transform financial management of businesses.

Jeff Seibert:

This is a fun one because the cliche answer, of course, is AI is going to completely change accounting, right? But let me go way deeper than that as an engineer. so a lot of what you've seen so far has been driven by the sort of generative hype train that started with ChatGPT. And so now there's tools to automatically draft client engagement letters, summarize data. write SEO content to attract new clients. And those are nice. I'm not saying those are bad and they might help save some time, but I don't think those are going to really significantly change the industry. if you look at it, most accounting and bookkeeping work is not generative. It is what we would call predictive. And so transactions happen, they need to be booked, right? Statements and balances need to be reconciled. Invoices and purchase orders need to be parsed and matched. Ledger entries need to be reviewed for mistakes or for fraud. These are all predictive types of work. And so there are new MI, ML, and AI techniques that are starting to make huge inroads into these core workflows. And we have teams applying new techniques like vector similarity search. Leg out aware, large language models, self critical agents, which is the cutting edge. and they're very effective at some of these core accounting workflows. And so I would say over the next few years, what's really going to happen is AI is going to start to open up massive efficiency gains, allowing accountants to spend a lot less time on the tedium, allowing them to serve far more clients with more time and more attention and care to those clients. And as the tedium falls away. The client relationships are going to become ever more important.

Rob Brown:

now I'm thrilled to welcome accounting royalty, Jennifer Warwa president of quick fee, north America and accounting thought leader and a FinTech executive who's driving evolution of payment solutions for the accounting industry.

Jennifer Warawa:

I would love to say that a lot will change in the next few years, but I said that 10 years ago, and I think I said that 20 years ago. And then when you go to keynotes at large accounting conferences, or you go and listen to podcasts, you're like, wow, we were talking about that 10 years ago or 15 years ago. and so I think that. we're still finding ourselves or firms are still finding themselves constrained with, on prem technology. We have a lot of firms. I'd love to get off of what I'm using, but I'm so deep in it, whether it's, practice management solution or an accounting solution. And, and so they're constrained by those challenges. And then you have a group of firm partners who is getting set to retire in the next few years. And they're like, I hope that I can retire before all of this has to get implemented or any major change needs to happen. So I think the change will probably well summarized by saying survival of the fittest. The gap will continue to widen between the innovative accountants and accounting firms who embrace change and adopt leading technology. And those who cling to the status quo. At a recent BDO event, the big topic was, this was an area meeting, but the big topic was The challenges attracting and retaining talent and, it feels like a very today problem. And Michael Horowitz from BDO said, I just want to let you know that if you came to the same meeting 10 years ago, this was the topic. If you came to the same meeting 15 years ago, this was the topic. So it's not, it feels new, but it's still the same as before.

Rob Brown:

Let's get ready to hear now from Jeremy Clopton upstream, Academy's managing director leading transformational change in accounting from leaders, inspiring a culture of innovation and forward thinking in the accounting profession.

Jeremy Clopton:

Technology's going to change, in the States, especially right now, the entry of private equity is changing. A lot of the conversation, there's a lot of the obvious stuff. I really believe that one of the big things that is changing the profession over the next few years is how we work. All right. Firms finally moving away from this idea that we sell hours. We sell our time hours or our inventory more hours is more success. That mindset shift, that approach to management, that fundamental change to the business model that says we don't generate value based on time. But instead we generate value based on the outcomes that we provide. the successes that we help clients achieve, the risk we help them mitigate. That is going to be one of the biggest changes in the next few years. And there are some firms that have already made that change. I don't know anybody's fully made that change. There's still always pockets, right? They latch onto the old model, but that is going to be a significant change. Because it's that mindset shift, that business model shift that is truly going to allow, in my mind, firms to take advantage of all the other changes that are out there, the technology, the outsourcing, the, the different, talent pipelines of different majors and the different way to staff and structure. But it's all contingent on the fact that we stopped thinking that our hours are what we're getting paid for. And we recognize it's the difference we're making for our clients. That's what we're, that's what we're getting paid for. That's the value that we're generating in the market. And it has to. if you think about all the other changes, implementing AI, implementing analytics, automation, process improvements, getting folks that are, more specialized and we reign in the processes and we get more, lean Six Sigma, all the things, all of those things are great, but if we still buy into the fact that we're getting paid for hours. That's going to make us less successful and that's a very bad place to be. So, tech and all the other, those are the easy changes, but we got to figure out, we got to move upstream and figure out, okay, what's the underlying problem that has to change so we can actually get the benefit of

Rob Brown:

that. So they have five great answers to the question. What, if anything will significantly change accounting in the next few years, every working day of the week, Monday through Friday, we give you the insights of five top influencers in the accounting world on this critical area of what is coming up. Change wise for accountants that's 25 valuable perspectives. Viewpoints and best thinking every week and with a fresh week comes the first question and more thoughts from the best influencers and leaders we can find in the accounting world. Thanks for listening to the accounting answers podcast and sharing this brand new show with your friends and colleagues. If you want to join the conversation. You can plug into our community of influencers@accountinginfluences.com. And check out our virtual speed networking events. These happen every few months for the north American region and the UK Europe region. These are great opportunities to raise your profile, build valuable connections and share your thoughts with influential peers. Until next time, this is your host, Rob brown, saying stay informed, stay relevant and stay connected.