Despite the uncertainty the global pandemic has brought, definite trends are emerging for the year ahead as the world adapts to a new normal.
By Megan Breen
For accountants, the twists and turns of the past two years have brought not just challenges, but opportunities as well.
Here are the main ones all accounting and finance professionals should have on their radar.
Implications of climate change for accountants
The conversation around climate change is evolving rapidly, and with the announcement of the establishment of the International Sustainability Standards Board (ISSB) at COP26 in Glasgow, the issue is of particular relevance to the accounting and finance industry.
Sarah Barker, partner and head of climate risk governance at Minter Ellison, says the formation of the ISSB is a recognition by the global standards setters that climate change presents significant challenges to reporting as usual.
“Climate change has evolved from an issue that was considered ‘ethical’ or non-financial to one that is broadly recognised as having material financial risks and opportunities,” Barker says.
“Accountants need to reconsider historical assumptions around the material drivers of value and whether or not, in this contemporary risk environment, climate-related issues have a material impact on financial performance, financial position and financial prospects.”
Barker expects this year to bring a more thorough understanding of the important role that accountants will have to play in addressing the implications of climate change.
“They will need to have an understanding of what the risk drivers and their potential financial implications are, whether that’s physical risks to the natural or built environment. For example, changes in return rates to inland flooding – what impact will that have for real asset valuations?
“They also need to have an understanding of economic transition risks, particularly the stark shift towards net zero emissions in the global economy. For example, how might that impact stranded asset risk in higher emissions industries?”
Developments in technology
Artificial intelligence (AI) technology can provide massive opportunities for accountants, says Alan FitzGerald, founder of Practice Connections Advisory, an accounting technology consultancy.
“AI was previously the domain of the larger firms due to the cost and resources needed, but now it has been democratised, with the cost negligible compared to even a few years ago,” FitzGerald says.
“The use of AI opens up opportunities to service a much wider audience. Being able to readily access data helps accountants build and tell a better story to clients about their business by cutting the time previously needed to gather and analyse such data,” he says.
“Many AI vendors now enable the detailed analysis of client general ledgers for errant transactions or can review thousands of invoices to find potential anomalies, process millions of lines of transactions as part of the audit process and more.”
This opens up opportunities for accountants to add new business advisory services, such as continuous audit.
FitzGerald also predicts e-invoicing to grow in 2022, pointing to the many benefits it offers, including significant cost savings.
“There are manifold benefits in helping clients move to e-invoicing, including reduced manual data entry, greater accuracy, faster payment times, reduced risk of fraud, scams and more.
“The ATO [Australian Taxation Office] has estimated that up to A$28 billion can be saved over 10 years by adopting e-invoicing systems, which is money that can be saved by everyone.
“The ATO estimates that between 30 and 50 per cent per invoice processed on both sides of the ledger can be saved. Who wouldn’t want to achieve that?”
Making a career move
As Australia’s economy begins to recover, businesses are showing more appetite for risk, putting expansion back on the agenda, says Nicole Gorton, director at professional services recruitment specialist Robert Half.
“That means demand is rising for roles such as financial control, forecasting management, anyone that’s working in data analytics and who has strong valuation capabilities to sustain expansion,” Gorton says.
“Digital transformation is accelerating across every finance function, and it is a massive priority for finance leaders. There is a demand for people with cloud capabilities and AI automation from a finance angle. As a result, we are seeing an increase of 20 per cent in salary expectations.”
Salaries are one aspect, but in order to retain and attract the best staff, employers need to look at a range of benefits as employees re-evaluate their career goals and search for a better work-life balance.
“People are looking for change, so you need to be able to show you have strong health and wellness initiatives, diversity and inclusion strategies and can offer career and professional development.
“Candidates are looking at 2-5 job offers, so companies are really going to have to showcase themselves to bring in the best,” says Gorton.