MNCPA PERSPECTIVES

Technology creates both uncertainty and opportunity

Aug. 23, 2017  |  Geno Fragnito

I don’t need to tell you that the world of technology is changing exponentially faster than ever.

Most people would agree that, while sometimes hard to accept, the changes in technology have improved many aspects of life, including business processes. Robots, drones, cybersecurity, blockchain, cloud computing and artificial intelligence are a few disruptive technologies affecting business (not to mention your own electronic personal assistant —Amazon’s Alexa). Your firm or company may be leveraging this ever-changing technology to be more efficient and provide more services to your clients.

However, evolving technology also creates uncertainties in the world of regulators.

You might be thinking, “If I follow the rules, I shouldn’t have any issues with regulators.” Under normal circumstances, I would say that is generally true. But technology’s rapid pace of change has redefined normal. Even though state and federal regulations are expanding, they don’t seem to be keeping up with the rate of change.

Accounting regulations guide how the CPA profession operates. As a CPA, you must follow the Board of Accountancy (BOA) regulations. These rules are what you might call traditional regulation of the CPA profession. If you work in business and industry, there are additional regulations for your business. If you work in public accounting, you need to know the regulations affecting your clients. But, because of technological advances, CPAs may also be under the jurisdiction of regulators that previously had no oversight of the profession.

For example, you might use a drone to verify inventory or conduct assessments. Now you need to be concerned about additional data privacy and property rights regulations. Or, maybe your firm is using artificial intelligence to comb through data, identify what rules to follow and make decisions to complete a transaction. The development of computer systems using artificial intelligence raises the question of who is ultimately responsible for the final answer.

What does that mean for you as CPA? It means you need to engage policymakers early and drive the discussion to proactively shape regulation. You are the expert. Don’t underestimate the value of your CPA credential when talking to policymakers. They value the experience and expertise you bring to the discussion.

As you look ahead, remember that technological change and improvements in one area may cause problems and issues in other areas. Businesses and CPA firms will need to examine whether they are leveraging technology to stay relevant, and then seek out opportunities to drive regulatory change to help increase your chances of coming out ahead.


Topics: Regulation, Technology

Geno Fragnito

Geno Fragnito is the MNCPA’s government relations director, advocating on behalf of the CPA profession. His days consist of last-minute meeting changes, building relationships with lawmakers, helping CPAs navigate state government, and putting in more than 15,000 steps per day walking the halls of the Capitol. Geno unwinds with a little golf and traveling with his family. If he weren’t a lobbyist, Geno would perfect his cast and be a professional fisherman. Geno can be reached at 952-885-5550 or gfragnito@mncpa.org.

Posts by this author


Comment on this post

* Indicates a required field.

Your name*:  

Your website URL:

Comment*: