After graduating in 1992, I worked briefly with an audit firm before joining Universiti Utara Malaysia (UUM) as a tutor. During those early days, I stumbled upon an intriguing article titled The Third Wave Breaks on the Shores of Accounting by Prof. Robert Elliot.
The article was groundbreaking, predicting that IT would become a driving force of change in business and that accountants and accounting education needed to evolve accordingly. This foresight deeply resonated with me and ignited a lifelong interest in how technology shapes the accounting profession.
Specialising in Accounting Information Systems (AIS)
In 1993, I pursued my Master’s degree in the United States, with a focus on Accounting Information Systems (AIS). My advisor, Prof. Peter McMickle, was a passionate advocate for AIS. Under his mentorship, I delved into databases, networking, and programming – areas that were still relatively novel for most accounting students.
This exposure laid the foundation for understanding how IT systems could streamline processes, enhance decision-making, and improve accuracy in accounting.
Upon completing my studies, I attended several interviews with top audit firms on campus. These firms were actively seeking Information Systems (IS) auditors, emphasising accounting candidates with strong IT knowledge and skills.
While I received job offers, my path was already decided: I returned home, bound by an agreement with UUM, which had generously sponsored my studies. This decision, though limiting at the time, allowed me to contribute to the development of the AIS field in Malaysia.
IFAC’s Four Roles for Accountants in IT
In 1995, the International Federation of Accountants (IFAC) released its first draft guideline titled IT for Professional Accountants (IEG11). This document classified accountants into four roles concerning IT:
Users: Accountants who utilise IT systems for day-to-day tasks.
Managers: Professionals who oversee the implementation and operation of IT systems.
Designers: Experts who design and customise IT solutions for accounting.
Auditors: Specialists who assess IT systems’ integrity, security, and compliance.
This framework inspired us at UUM to rethink how we approached accounting education. Recognising the growing demand for IT-savvy accountants, we developed a new programme: Accounting (Information Systems).
After intense discussions and debates, including securing approval from the Malaysian Institute of Accountants (MIA), the programme was officially launched in 1999. It was a significant milestone, bridging traditional accounting practices with emerging technological demands.
The Rise of AIS and Global Trends
During the late 1990s and early 2000s, AIS began to gain traction globally. The American Institute of Certified Public Accountants (AICPA) played a pivotal role in highlighting the importance of technology, publishing annual reports on the top ten technologies impacting accounting and finance.
These reports underscored the potential of IT to revolutionise the profession by improving efficiency, accuracy, and strategic insight.
During the mid-2000s, I earned a certification from SAS, a world-leading business intelligence company, and engaged in numerous training and consultancy projects with multinational corporations, government-linked companies, and government agencies. These experiences provided valuable insights into the practical application of AIS and related technologies.
Based on my observations, the adoption of AIS and related technologies in Malaysia lagged behind international trends. Local organizations, including accounting firms, were slower to integrate these innovations, partly due to a lack of awareness and the traditional mindset prevalent in the profession.
This inertia persisted until 2015, when Klaus Schwab introduced the concept of Industry 4.0 (IR 4.0) at the World Economic Forum. The term emphasised the transformative potential of technologies like artificial intelligence (AI), big data, and the Internet of Things (IoT), sparking renewed interest in the integration of technology into accounting.
Bridging Policy and Practice: The MIA Digital Technology Blueprint
My journey took a new turn when I joined the Ministry of Higher Education (MOHE). During this tenure, I had the privilege of collaborating with the Malaysian Institute of Accountants (MIA) on their Digital Technology Blueprint, published in 2018.
As a member of the task force, I contributed to shaping strategies to prepare the profession for the digital age. The blueprint provided a roadmap for accountants to leverage technology, emphasising areas like automation, blockchain, and data analytics.
This initiative was a critical step forward, addressing the growing need for accountants to adapt to a rapidly changing landscape. However, despite these efforts, scepticism remained.
Many argued that IT would render accounting obsolete, replacing human professionals with machines. While these predictions did not materialise as quickly as some expected, the advent of AI has reignited these discussions.
The Disruption of AI in Accounting
The rapid development of AI in recent years has brought the issue of technological disruption in accounting to the forefront. AI systems can now perform tasks such as:
Data Entry and Reconciliation: Automating routine tasks with higher speed and accuracy.
Financial Analysis: Generating insights and forecasts using predictive analytics.
Auditing: Conducting risk assessments and identifying anomalies in financial data.
Tax Preparation: Simplifying compliance and reporting processes.
These advancements challenge the traditional roles of accountants, particularly those focused on transactional and compliance-based tasks. As AI continues to evolve, it is likely to redefine the profession, shifting the focus from routine work to strategic decision-making and advisory roles.
Will AI Replace Accountants?
The question of whether AI will replace accountants has sparked much debate. While AI excels at automating repetitive tasks, it still lacks the judgment, ethical considerations, and nuanced understanding that human accountants bring to complex scenarios. Instead of viewing AI as a replacement, it is more constructive to see it as an enabler that enhances the accountant’s role.
For instance, AI can free accountants from mundane tasks, allowing them to focus on providing strategic insights, financial planning, and advisory services. By embracing AI, accountants can become trusted advisors who guide organisations through the complexities of a data-driven world.
Preparing for the Future: Time to Rethink
The question we must ask is not whether AI will disrupt accounting but how we can prepare for this inevitable change. Based on my experiences, here are a few key considerations:
Reimagining Education: Accounting curricula must evolve to include AI, data analytics, and programming. Future accountants need a strong foundation in technology to remain relevant.
Lifelong Learning: Professionals must embrace continuous learning, staying updated on emerging technologies and their applications.
Collaboration with IT Experts: Accountants should work closely with IT professionals to design and implement effective technological solutions.
Emphasizing Ethics: As AI becomes more integrated into decision-making, maintaining ethical standards will be critical to ensure transparency and accountability.
Reflecting on the Journey
Looking back, the journey from discovering Prof. Elliot’s article to contributing to Malaysia’s Digital Technology Blueprint has been both challenging and rewarding. It has shown me the importance of adaptability and forward-thinking in navigating a profession that is constantly evolving.
The lessons learned along the way underscore the need for a proactive approach to change, particularly in a field as dynamic as accounting.
As we stand on the brink of a new era, driven by AI and other disruptive technologies, it is clear that the future of accounting will look very different from its past. By embracing innovation and rethinking traditional practices, we can ensure that the profession not only survives but thrives in the age of AI.
Note: Dr Azizi is a professor in accounting information systems at the Malaysian Graduate School of Entrepreneurship and Business (MGSEB), Universiti Malaysia Kelantan. He can be contacted at [email protected]
