How can accountants leverage technology to provide better advisory?

Vincent Chan, Rex Leung, Keith Williamson

Experts chime in on the latest developments in accounting and business.

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Vincent Chan, Rex Leung, Keith Williamson


Second opinions

Vincent Chan CPA, Partner at EY, and Co-convenor of the Institute’s Information, Communications and Technology Interest Group Organizing Committee

Ever since the introduction of technology and automation in business many years ago, the question on everyone’s mind is: “Will my job be replaced by artificial intelligence (AI) and robots one day?” It is certainly a fair question for accounting professionals too, as some would even say that accountants face a higher likelihood of being replaced in this regard, as our work is largely rule-based and computation is at the heart of it.

Today, with the increasing maturity of business applications of emerging technologies like AI, blockchain, cloud and data (sometimes referred to as the “ABCD” technologies), it is ever more important for accountants to leverage these technologies in order to stay relevant. For example, with technology, accountants can focus more time on value-added activities, decision-making and tackling complex business issues, leaving those time-consuming and repetitive tasks to tools like robotic process automation. Auditors can cover a broader sample in testing using data analytics and obtain more insight from the underlying data. With the decreasing cost of storage and hardware, increasing processing power, and the availability of on-demand processing through cloud, big data analytics will soon become a widely available tool for all.

The role of accountants is equally important in advising businesses that are going through various types of digital transformation, whether it is transforming internal functions like finance, enhancing customers’ experience with mobile apps and AI chatbots, or embarking on innovative ideas like engaging customers and employees in the metaverse. For instance, the availability of cloud and other subscription-based solutions provides good options for businesses looking to switch from a capital expenditure model to more of an operational expenditure one through having less on-premises technology, not worrying about the ownership of systems, and having a full team of technology professionals, especially when there is an expertise shortage in the global market. Being equipped with a good understanding and appreciation of the nature and mechanics of these technologies and solutions, the cost and ownership models, and also the business risks involved (such as cybersecurity and data privacy) will help accountants to be valuable advisors to the business.

In this post-COVID era, people are more receptive to the use and adoption of technologies than ever before, from simple virtual workplace tools to help teams collaborate remotely, to full-scale inside-out digital transformations of the businesses. Now is the time for accountants to leverage technologies to create innovative ways to do their job better, and to become the next generation of business advisors.

“The role of accountants is equally important in advising businesses that are going through various types of digital transformation.”

Rex Leung FCPA (Practising), Partner at Linkers CPA Limited

The COVID-19 pandemic has forced companies to transform their business models and digitalize their operations to keep the ball rolling. This has also led to the implementation of work-from-home arrangements, with companies realizing that there are different ways to operate and communicate.

But surviving, and most importantly, thriving within this new normal still presents great challenges for most businesses and accountants. How can accountants grasp such opportunities to provide better advisory services and help more businesses?

Accountants in our firm, for example, have had to adopt and leverage new technology in order to advise the clients on digital transformation. Business owners may consider asking themselves the following questions to review, rethink and reset their business model:

  1. Is your workforce remote-ready, in terms of infrastructure, communication channels and reporting protocols? Are employees able to maintain normal operations anywhere outside the office?
  2. Have you reviewed which functions are most essential to your business nature, whether they can be digitalized, and how this might benefit your company?
  3. Have you considered migrating some of your key functions to the cloud to enhance productivity or even add value to your company?

More businesses are migrating finance and human resources (HR) functions to the cloud or outsourcing both, allowing owners to focus on driving the businesses and providing them with access to the company’s financial and HR activities in real-time. Being able to access such key financial information offers the following advantages:

  • Visibility of the current financial position at any time from anywhere and multi-user access;
  • No need to invest in hardware, servers, or external memory to maintain these solutions; all data is automatically uploaded and updated on the cloud platform; and
  • With no upfront costs, most cloud solutions operate via a monthly subscription basis, providing companies with the flexibility to scale up the level of service as needed.

Keeping a business going and expanding in such a highly competitive and challenging environment isn’t easy. But by properly implementing tech solutions, and using them to their full potential, accountants are able to provide better advisory services to clients and to continue thriving amid the new normal.

“By properly implementing tech solutions, and using them to their full potential, accountants are able to provide better advisory services to clients.”

Keith Williamson CPA, Managing Director and Asia Lead of Disputes and Investigations at Alvarez & Marsal

For forensic accountants, leveraging technology is critical to performing thorough corporate investigations and compliance reviews in line with the requirements of regulators, law enforcement agencies, investors and other stakeholders, while minimizing business disruption and controlling the cost of forensic accountants and other advisors.

Extracting accounting and transactional data from disparate systems, and analysing, interpreting and presenting it electronically is key to identifying a corrupt or fraudulent transaction among millions of line items of legitimate business transactions. Equally, extracting electronic correspondence and data from devices and servers, and subsequently preserving, processing, keyword searching and reviewing such data is important to identify the who, why, what, when and where of suspected inappropriate activity.

Given the challenges of working remotely and the travel restrictions imposed over the past two and half years, particularly in Asia, the importance of technology to assist in corporate investigations and compliance reviews is greater than ever. For example, data analytics and eDiscovery reviews can largely be performed remotely with minimal disruption to finance and operational teams, and without tipping off suspected fraudsters or corrupt employees that an investigation is underway.

Data analytics is not only important to the success and efficiency of forensic accounting investigations but can also be used by finance teams or internal auditors as an effective remote monitoring tool. The thoughtful design and scoring of relevant tests to run across accounting data covering transactions, third parties and employees enables the creation of a risk profile model that allows investigators, finance teams and internal auditors to focus their limited resources on identifying the highest risk patterns.

As well as providing a defensible and cost-effective investigation methodology, data analytics risk modelling is an effective, focused and repeatable monitoring tool that provides an added layer of protection to any compliance regime.

The use of data analytics for investigations and compliance reviews has enabled us to identify corrupt and fraudulent transactions and schemes that would have been extremely time-consuming and difficult, if not impossible, to identify otherwise. We can still present a defensible investigation methodology to law enforcement agencies and regulators, such as the United States’ Department of Justice and Securities and Exchange Commission, which satisfies them that our clients have conducted a thorough review that would have identified evidence of inappropriate transactions if they did, in fact, exist.

“The importance of technology to assist in corporate investigations and compliance reviews is greater than ever.”

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