Blockchain And the Future of Accountancy
BLOCKCHAIN AND THE FUTURE OF ACCOUNTANCY
Blockchain is an accounting technology. It entails the transfer of ownership assets and maintain a ledger of accurate financial information. The accounting profession mainly dwells in measurement and communication of financial information. Much of the profession is concerned with ascertaining rights and obligations over property, or planning how to best allocate financial resources. Blockchain provides accountants with clarity over ownership of assets as well as improved efficiency.
Blockchain can elevate the accounting profession by reducing the costs of maintaining and reconciling ledgers, and giving certainty over the ownership and history of assets. Blockchain could help accountants’ free up resources to concentrate on planning and valuation. Top accountants will be those that work on assessing the real economic analyzation of blockchain records, joining the record to economic reality and valuation.
Through getting rid of reconciliations and providing certainty over transaction history, blockchain could also enhance the scope of accounting bringing into consideration sections that are considered too difficult to measure such as the value of the data that a company.
Implications of blockchain for auditors
Blockchain has applications in external audit. Acting confirmations of a company’s financial status would be less necessary if some or all the transactions that underlie that standing square measures are visible on blockchains. This proposal would mean a profound amendment within the method that audits work. A blockchain solution once combined with acceptable in formation analytics, could facilitate with the transactional level assertions considered in an audit, and the auditor’s skills would be better spent considering higher-level questions (Mathis, 2018)
How the profession can lead with blockchain
The move to a financial system with a remarkable blockchain element offers many opportunities for the accountancy profession. Accountants are accomplished in record keeping, application of complex rules, business logic and standards setting. They can guide and influence how blockchain is embedded and used in the future, and to develop blockchain-led solutions and services.
Accountants also have the capability of working as advisers to companies that contemplate joining blockchains themselves, providing advice on weighing the costs and the benefits of the new system. Accountants’ mix of business and financial nous will position them as key advisers to companies approaching these new technologies looking for opportunity.
Skills for the future
The sections of accounting concerned with transactional assurance and carrying out transfer of property rights will be changed by blockchain and smart contract approaches. Accountants and firms that develop these skills now will be able to differentiate themselves as the technology becomes widespread. The days of offering value simply through accurate data entry and calculations are numbered, so taking the time to retool now and work on your advisory skills is an investment in the future of our work. There has no getting around the fact that technologies like blockchain and machine learning are no longer a tiny dot on the horizon. The future is here, and accounting professionals must be willing to adapt (Hill, et al 2018).
Hill, B., Chopra, S., & Vallencourt, P. (2018). Blockchain quick reference: A guide to exploring decentralized blockchain application development. Packt Publishing.
Mathis, T. (n.d.). Blockchain: A guide to blockchain, the technology behind bitcoin, Ethereum and another cryptocurrency. Level Up Lifestyle.