It’s a no-brainer that the dynamism of the business operations landscape in the finance and accounting (F&A) profession is becoming more complex by the day. On the one hand, professional teams are having to come to grips with varied elements such as increased competition, fluctuating currencies, rising costs, more regulated supply chains, the impact of the COVID-19 pandemic, and the varied impacts of enhanced digitization, etc. On the other hand, there is the need to make sense of the enormous streams of data, which come infused with its own set of technology needed to decipher and use them: tech such as AI and Big Data, for example. If this wasn’t enough – the gradual mainstreaming of cryptocurrencies into the business ecosystem and the emergence of the NFT ecosystem are other fast curveballs being thrown into this landscape. These are all developments that traditional CFOs and their teams were not entirely equipped to handle and most often arise with short to no notice. Last but not least, there are significantly stricter regulatory compliances that these teams must deal with. As firms reengage with the marketplace and focus on enhancing performance and boosting growth post-pandemic, the alignment with corporate governance is another crucial factor. From risk and compliance management, fraud management, and regulatory monitoring and reporting, F&A teams need to be on top of all of this and more – at all times. Challenged as they are to keep up with the complexity of this, there is also the added burden of assisting entry level employees to come up to speed — thus revealing another challenge: the emerging skills gap at multiple levels of the business.
CFOs and their teams are seeing many accounting applicants joining the profession; however, they mostly have basic skills — usually limited to entry-level tax and audit work. There is a dearth in the proficiencies needed to lead teams and drive business forward. This reduced influx of adequately if not highly skilled F&A employees is making it nearly impossible to effectively fill key accounting positions inside organizations, thus hampering performance, growth, and economic expansion.
Left unsolved, this “entry-level economy” could have serious implications on the F&A domain across industries and sectors. But there are solutions to the problem. The focus is on academia revitalizing age-old curriculum and teaching methodologies to integrate contemporary and industry-aligned subject matter information. For the F&A domain in particular, the old must give way to the new and colleges and universities need to introduce management accounting into both, the finance and accounting and the business management streams, to ensure that students come face-to-face with a business ready approach to financial management.
For many years, the traditional accounting curriculum has struggled to keep up with technological advances and changing CFO requirements. To plug the skills gap and ensure the future of the profession, there is a need for a new breed of accountants with skillsets that allow them to become value creators and business partners. Consequently, there is the need for an integrated approach to curricula, competencies, and training that aligns with the way business is conducted for sustainable value creation. Much of this effectively begins in the classroom. However, until recently, classroom curriculum was too narrowly focused on financial accounting, specializing around audit, tax, statutory reporting, and compliance. Many young professionals begin their careers at public accounting firms doing audit and tax work. But, when they move into management accounting roles or into consulting and advisory roles, where the focus is on value creation, they find out that they simply don’t have the required skills to understand business operations and provide strategic value-addition to the business. In comparison, management accounting differs from financial accounting because the intended purpose of management accounting is to assist users internally in making well-informed business decisions.
The need to increase and foster industry-academia partnerships is imperative to the success of the future of the F&A functions and the professional world at large. Increased involvement of industry professionals in the classroom provides an array of opportunities for students to learn real-world applications. However, markets are also ever-changing more rapidly than before and this requires graduates that are more agile who can deal with such changes. To do this, top business schools are transforming their curriculum and pedagogy to be more inclusive of relevant topics beyond traditional financial statements that affect corporations today. This fusion of theory and practice accelerates the learning curve for students and equips them with the necessary skillsets preparing them for the professional world. Despite that, what remains to be seen is the future role of educational institutions in fulfilling the constantly evolving requirements of the private sector.
As the accounting profession shifts away from traditional auditing, statutory reporting, and compliance, and takes on a more managerial hue that aids in value creation, it has spurred a demand for multi-talented professionals with broader skillsets across accounting, finance, technology, operations, and leadership. These professionals are equipped with skillsets not easily automated such as advisory services, decision-making, strategy, and communications. As the digital revolution gathers pace, CFOs increasingly value soft skills such as emotional intelligence, the ability to quickly evaluate situations, and communicate effectively. At a more technical level, these professionals will also need to leverage the potential of artificial intelligence, including cognitive computing and machine learning.
As a greater number of institutes offer management accounting courses and an increasing number of CFOs hire management accountants, it is also essential for businesses to invest in the professional development of their existing F&A teams to bolster their planning, leadership, and other skills. According to the World Economic Forum’s Future of Jobs Report (2020), 54% of large organizations’ employees need significant re-and up-skilling to keep apace rapidly transforming markets. Many organizations have found that mentor programs, internship programs, apprenticeships and certification support have created accounting and finance talent with the ability to provide value across departments and provide decision support at the management table. Expanding accountants’ knowledge base will grant them the ability to adapt when abrupt changes occur. Ultimately, it will translate into greater performance and profitability for companies. Therefore, the task at hand is one of collaborative effort, which can only be achieved when the academic, public, and private sector begin to identify the set of skills needed to cut it in the near future and in turn, prepare the next generation to not only succeed, but to thrive.