In accountancy, the robots are coming. PwC believes there’s a 97.5% chance of accounting being replaced by automation over the next two decades. Anyone hoping to work in accounting will need a firm grasp of the digital disruption rolling through the industry.
The Big Four professional services firms — KPMG, PwC, EY and Deloitte — employ vast swaths of business school graduates annually. And the biggest growth in talent demand is for budding auditors who can trawl through ever larger mountains of big data using advanced analytical tools.
“Big data is starting to take hold on the industry, with the Big Four leading the way,” says Alex Stremme, assistant dean for the finance masters program at Warwick Business School.
Data analytics allows auditors to test and analyze entire data sets, such as expenses claims or company logs.
Richard Anning, head of IT faculty for the Institute of Chartered Accountants in England and Wales, says: “Data analytics provides opportunities to develop new insights about the business and challenge management’s view through a different lens.”
The shift is being prompted partly by challenges from tech-savvy companies such as Amazon and Google. Technology has moved services online and lowered barriers to entry, paving the way for a new crop of players to disrupt the audit, accounting and advisory divisions of the leading professional services firms.
Nick Frost, partner and head of audit technology for KPMG UK, says: “To deal with this real threat we must become the best at accountancy-based or financial process data analytics.”
In response, firms are launching new technology initiatives designed to innovate some of the oldest known professional services.
Despite concerns over data security, auditors are increasingly embracing cloud computing, which can automate low-level administrative tasks and free up time, as more audit clients seek to administer payrolls and file tax returns online. Deloitte, for example, just launched a cloud-based accountancy service called Propel, which targets SMEs. And last year, KPMG spent £40 million on cloud software that lets companies prepare their accounts digitally.
Such technologies are poised to change the way that accountants and financiers work. Faye Chue, head of business insights at the Association of Chartered Certified Accountants, says: “Their role will no longer be primarily reactive and backward-looking but proactive, continuous, forward-looking and engaged.”
This will also spur a shift in the training and education of accountancy professionals. At NYU’s Stern School of Business, the accounting department is developing new courses in statistical and data analysis, says Alex Dontoh, professor of accounting and deputy chair of the department.
The demand for tech-savvy talent is part of a broader change in the professional services recruitment market. Firms are now looking for core management and leadership skills, which is good news for MBAs.
“Accountants now manage some of the problems in a broader sense. They are not pure accountants checking figures without thinking beyond them,” says Dr Edgar Loew, professor of management practice in accounting at Frankfurt’s School of Finance & Management.