By Monique Sharland<\/p>\n
\u201cBlockchain technology is already disrupting a number of industries, and it is here to stay. Though in its infancy, its application will only continue to increase. But will it make accountants irrelevant?\u201d This question was posed by Forbes Magazine writer Andrew Arnold and many others.<\/p>\n
This is a topic that has been of particular interest of mine over the past several years and I have been consumed by reading everything I can on it. As technology advances at rapid speed, not only should we all be aware of these developments, but we should all be looking at what opportunities it holds for us and the skills we will need for the future.<\/p>\n
Blockchain is best known for being the technology foundation of cryptocurrency, the first and most well-known being Bitcoin. There are now over 1600 cryptocurrencies.<\/p>\n
You don\u2019t need to understand the intricacies of the blockchain technology\u2014that\u2019s for developers who build the code. You need to understand and know how to advise on blockchain adoption and consider the impact on your business and clients. As accountants, our skills will need to expand to include an understanding of the principle features of blockchain. Blockchain already appears on the syllabus of several accounting qualifications in the United States and the United Kingdom.<\/p>\n
What is Blockchain?<\/strong><\/p>\n Blockchain itself is a technology based on accounting. It records and stores assets, liabilities, transactions, and provides methods of recording cash flow and reconciling accounts. \u201cSo, it is a \u201cnatural\u201d for the accounting industry which to date has relied on paper trails and even cloud-based technology to perform accounting functions and transactions\u201d says Forbes Magazine.<\/p>\n Blockchain provides an unalterable and transparent record of all accountancy-based data ensuring that the records are accurate and truthful. It provides absolute certainty over the ownership and history of assets and liabilities.<\/p>\n Implications of Blockchain for Bookkeepers<\/strong><\/p>\n Whenever a new technology arrives, there is worry about its danger to job-holding individuals who are impacted by it. As business owners, we have more control by adapting to technology and finding other sources of revenue by the opportunities presented by that new technology. So, do bookkeepers need to fear for their jobs? There is a \u201cYes\u201d and \u201cNo\u201d answer to this question. While bookkeepers must accurately maintain the transactional records by way of data capturing, then the answer is Yes. \u201cBlockchain is a replacement for bookkeeping and reconciliation work. This could threaten the work of accountants in private practice working in those areas, while adding strength to those focused on providing value elsewhere\u201d says the Institute of Chartered Accountants in England and Wales (ICAEW).<\/p>\n But for those job-holding bookkeepers who have to oversee accounts receivable, payments for goods and services, prepare invoices to customers\u2014even with blockchain, someone has to enter purchase orders and payments into those blocks\u2014so the answer is No. What this new technology will provide is efficiency, permanent and transparent records\u2014a dream for accountants.<\/p>\n And What About the Future for Accountants?<\/strong><\/p>\n \u201cWhile blockchain will certainly disrupt the accounting industry, the accountant\u2019s role will change, but will not be eliminated. Information must still be interpreted and categorized correctly before it is entered into the blockchain and it will fall on the accountant to do this as well as implement and maintain the blockchain\u201d, according to Forbes.<\/p>\n \u201cFrom an independent review and audit perspective, there will be no need to confirm the accuracy or existence of blockchain transactions with external sources but there is plenty of attention to pay to how those transactions are recorded and recognised in the financial statements, and how judgements such as revaluations are decided\u201d, stated ICAEW.<\/p>\n Furthermore, other areas such as technology, business advisory and other value-adding activities will expand. To properly conduct an independent review on a company with significant blockchain-based transactions, the focus of the independent reviewer will shift.<\/p>\n The Bottom Line? <\/strong><\/p>\n The long and short of it is that blockchain is not a threat to accountants, but an opportunity. Don\u2019t be afraid of this new technology, but rather \u201cget schooled\u201d in it. You need to understand it and how to use it to your clients\u2019 advantage in the future\u2014this will keep you relevant and in demand.<\/p>\n","protected":false},"excerpt":{"rendered":" By Monique Sharland \u201cBlockchain technology is already disrupting a number of industries, and it is here to stay. Though in its infancy, its application will only continue to increase. But will it make accountants irrelevant?\u201d This question was posed by Forbes Magazine writer Andrew Arnold and many others. This is a topic that has been…<\/p>\n","protected":false},"author":2,"featured_media":3724,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-3704","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","entry","has-media"],"yoast_head":"\n