The accounting industry “won’t have a business” if it doesn’t adapt to technological advancements in the SMSF sector which are continuing at pace, said Smithink 2020 founding director David Smith at an SMSF Professionals’ Association of Australia NSW state chapter event.
“I can see the day that we will have automated tax returns and sets of accounts done, which means the accounting profession’s core business is really decimated. The accounting industry to survive, it needs to move to the world that we are talking about,” Mr Smith said.
“The machine automation is going to continue at pace, and it will accelerate. So if you look in the core work of the accounting industry, that’s going to decimate, there’s no doubt about that.”
Mr Smith also suggested the automation of advice could start in the next decade, after previously suggesting fully automated audits are also on the horizon.
BDO partner, private clients, Kim O’Brien also believes the compliance elements of advice practices will “reduce significantly”.
“I believe that will be automated in one way or another, whether that’s onshoring or offshoring, cloud technology – there will be significant changes in that space,” she said.
“In order for our businesses to survive, whether it’s in a financial planning environment or accounting environment, we will be doing more consulting work.”
I think the age would be more related to the acceptance of change. I myself am 30 and believe all these things will eventually happen. I would expect people in their 50s to be less accepting of these predictions. In saying that I have a brief background in IT as well so I can see how these things would happen from that angle
I not sure of the benefits of putting the age next to comments, while I agree that wisdom usually comes with age, the views of young people shouldn’t be discarded because of their lack of experience.
This is an automated comment from a cloud in India. Thanking you very much for your prediction. I think no.
i think everyone should put their age next to their comments. As for audit, how does the auditor know if the artwork is hanging in the living room? They ask the question. What is to stop a computer program asking that same question if it is told a certain investment is in a certain category it can generate pre determined questions which could easily be sent to a client automatically via email or a “questionnaire” type webpage generated for the client to fill in. Based on those responses, more questions could be generated or the audit completed. There is a bit of judgement involved for some investments but I would think the majority could be automated. And eventually with the rate of AI, auditors won’t be needed at all in the SMSF space. Only thing on the auditors side is time. It will take time for the technology to become readily available and affordable
interesting
Why not the best of both worlds? Automate the easy pieces, yes have the qualitative audit issues such as those listed below. There will ALWAYS be clients willing to pay for professional and personal advice, in some cases no matter the cost.
These clients are not to be abused, they should be cherished.
It’s a big pond and there is no one, and only one, business model that will succeed.
Being the clients relationship manager for investments, accounting, audit, estate planning, business succession planning, lending etc. you don’t need to do all these things but you can project manage them with other professionals for your clients benefit…and they will love you for it.
Yes technology is forcing the profession to automate but only very small businesses will ever be be able to automate their own tax returns. The same applies to SMSF’s of any substance. How does a cloud system and automated chart of accounts calculate a vehicle FBT reimbursement, assess the deductibility and application of complex tax laws to a clients situation, assess Div 7A loans and inter entity loan reconciliations and the tax law implications of same. Correctly apply the CGT concessions to a business or asset sale. Yes changes are happening quicker than they used to but i still see myself in this profession doing plenty of compliance work for another 20 years. Good business advice will be critical as it is now but compliance will still be there to deal with. Embrace the new technology, give good business advice to your clients, get more efficient at doing things but don’t hold your breath too long hoping for compliance work to disappear any time soon.
Yes technology is changing the profession , i agree we automated a lot of process but you cannot automate the advice and the human factor. Clients want to be a contacted and have things explained. the role of accountants is changing to more advice driven. Thats why accountants and Fin. advisor will eventually merge the writing is on the wall
Wishful thinking! Technology will never replace good advice.
Oh Kim, I think too much christmas cheer was had by one. To automate the elements of compliance within a advice practice…..How do you automate qualitative responses.
George VC, I totally agree with you and have made similar comments regarding compliance audits.
However, David is quite on track about accounting or compliance work evaporating for accountants in future.
……p.s. happy new year to all my readers! 🙂
…”automated audits are also on the horizon” I think you may have misconceptions about what an SMSF audit is about. Sure, computers can vouch investment holdings ’til the cows come home, but these are compliance audits, not financial audits. Industry has suggested many times that an smsf audit be reduced to an annual compliance certificate.
I fail to see how a computer can conclude that a smsf loan was to a company controlled by one’s brother in law; that artwork is hanging in your living room and not it storage; that your sister’s defacto spouse is renting the house owned by your smsf; that the underlying investments of a related non-geared trust dont comply; that your 100% BRP has a granny flat that you have lived in since your wife kicked you out; that the property your smsf acquired last belonged to your family trust; that your LRBA doesnt comply, or that you said you retired and accessed your benefits but your website says you are still the managing director!