Impacts of Digital Transformation in Accounting Profession Essay
In this era, digital transformation is something that could not be avoided by businesses. As defined by The
Enterprisers Project, digital transformation is the integration of digital technology into all areas of a business that
essentially changes how a business work and deliver its value to customers. Members, professional organizations,
and all institution must follow the changes of evolved technology to be updated and stay competitive besides their
competitors. Since digital transformation impacts how a business operate, accounting profession is one of the
highly impacted sector. According to Alvin Toffler, the rapid development of digital environment results in very
significant changes in area of the accounting job. The development of accounting based digital advances occur in
three segments; the era of farming, industry, and the era of the information age. Therefore, the accountants need
to be prepared for change and threats in how they operate in the business. As quoted by Eric Pearson, CIO of
International Hotel Group: “It is no longer the big beating the small, but the fast beating the slow.” If accountants
of a business or accountant firms themselves choose to be ‘slow’– not following the digital transformation, they
could get beaten by the ones that has followed it, the ‘fast’. This era is no longer about how big a company is but
how a company follows digital transformation. Remembering how many accounting firm are established
nowadays, the competition between those firms are very tight. If they choose to avoid and not prepare for the
digital transformation, they could get left behind and lose. But, are all impacts of digital transformation in the
accounting field positive? What kind of impacts has digital transformation bring to the accounting profession? This
essay will explain advantages on how digital transformation impacts the financial statements provided by the
accountants, disadvantages that comes within and conclude with a solution for the accountants and the company
as a whole itself.
According to Lesley Stewart (2017) as an accountant, he feels that digital transformation that has been
changing especially in accounting profession was very meaningful and successfully beneficial for the sector that
handles financial activities by making the process in the financial purposes speeds up. Accountants will only just
need to input anything on the existing software that automatically process the data until the final stage. It means
that the accountant is no longer “time–consuming” in doing their task. They do not have to do their job manually
again because logically, recording any transactions manually is prone to human error. While using software that
exist nowadays, will reduce those errors and maintain the accuracy of the data so that will make the financial data
more reliable to the end users. Of course, this will be affecting the matter of “time–used” because once the
accountant makes error in recording the data, they have to check again one by one the transaction papers to
search the places that contains the error. While with the help from software, the accountant could be warned if
there is any error in inputting the data. Talking about time effectiveness, one of the accountant firm, Best Choice
Accountancy Limited has stated in their web portal that, “makes it possible to find important information and
document quickly”. They made it as one of the reason to keep accounting records. Reading from that statement,
we can conclude that in using software, it will help auditor to find the important information and document
directly without having to search one by one the papers which can consume more time. In purpose to make
possible to find any important information and documents, if the accountant uses a software, they only need to
search what information they need and directly find it. From these reasons, we can conclude that how important
and beneficial is software in helping the accountant in maintaining their time-effectiveness that directly can help
generate the business process, especially in financial sector.
Another advantage of the digital transformation is increase of accurate information on making the
financial statements. Accurate information is a data that is filled with certainty, which corresponds to the purpose
of the data processing that is not biased or contain no errors. Sheila Shanker, a certified public accountant who is
based in California explain that detail and accurate data are crucial in accounting work, since there are
transformations of digital world, few errors will be experienced compared to manual calculation if accountants
were using accounting application. The digital accounting system is designed to detect the smallest detail. Once
the data is entered into the system, all the calculations, including the addition and subtraction is done
automatically by the software so as to guarantee the accuracy of the figures because nothing is processed and
recorded twice. All data is obtained from the beginning of the recording. Digital development also necessary in
preventing human error. On the manual accounting system with high amount of data transactions will need more
human intervention in processing the data that could increase the possibility of risk of misstatement. In digital
