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The importance of the Finance discipline in the 4IR

Authored by:  Bernard Nyambo

The Fourth Industrial Revolution represents a fundamental change in the way we live, work, and relate to one another. It is a new chapter in human development, enabled by extraordinary technology advances commensurate with those of the first, second, and third industrial revolutions. These advances are merging the physical, digital, and biological worlds in ways that create both huge promise and potential peril. The speed, breadth, and depth of this revolution are forcing us to rethink how countries develop, how organisations create value, and even what it means to be human. The Fourth Industrial Revolution is about more than just technology-driven change; it is an opportunity to help everyone, including leaders, policy-makers, and people from all income groups and nations, to harness converging technologies in order to create an inclusive, human-centered future. The real opportunity is to look beyond technology and find ways to give the greatest number of people the ability to positively impact their families, organisations, and communities.

What has changed in the Finance sector due to the Fourth Industrial Revolution?

Accountants are moving away from bookkeeping and stewardship to become strategic business partners. Routine and process-driven roles are decreasing while roles that require thinking outside the box are gaining momentum and will be in demand. Customers though still need persuading that technology is the way forward. Specific developments include cloud technology and big data, both of which are affecting all businesses, not just accountants. Clients are more empowered by data and technology too. There is no underestimating the power of technology. It will change the unit costs of the finance function and the pricing models of the future. Cloud technology is also secure and allows for seamless updates to be performed. The level of insight that can be obtained from it far surpasses anything that is possible on an “on-premise system” and any changes, such as adding new companies, can be almost instantaneous. Seamless implementation can only be achieved with a project team that understands what needs to be achieved conceptually and then technical teams and solutions providers working together to make this happen.

We need to see how we can link financial accounting with other business disciplines such as project management. In project management, the accounting function is responsible for developing and maintaining a chart of accounts with cost codes that project management can use to manage and forecast the project effectively. Project costs are generally entered into the accounting system by the accounting function upon the approval of project management.

Accounting is also making use of cloud technology whereby accountants are mobile working. People can access their data anytime, anywhere, which has fundamentally changed the way businesses operate. The ability to perform real-time reporting has also transformed organisations. More information can be pushed directly into the hands of business leaders in the format they want it. Cloud technology can be used to do many things such as recording people’s names against revenue transactions. Accountants can make use of software-as-a-service (SAAS) technology, which allows access to individual applications and is hosted in the cloud.

With the 4IR accounting package, the way of doing business is being answered. Traditional technology would only answer the who and the what. The linking of non-financial information into general ledgers means accountants can now offer richer services such as lowering infrastructure costs, set-up costs, and quick transactions among others.

References

https://www.weforum.org/focus/fourth-industrial-revolution

https://www.bizcommunity.com/Article/196/511/182058.html

https://www.linkedin.com/pulse/wtf-whats-future-cpas-finance-accounting-industry-40-tom

https://accountingweekly.com/how-the-fourth-industrial-revolution-is-reshaping-accounting/