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By Jianing Fang, CPA, PhD
Posted on 9/11/08
If you are a bookworm or a Web-surfing junkie like me, you may feel overwhelmed by the sheer number of different technologies available and their applications for CPAs.
And just when you think you’ve got a good understanding of those technological tools, it’s time to learn a new one.
It’s likely that your information technology (IT) vendors are now extolling the benefits of Electronic Data Interchange (EDI), Electronic Content Management (ECM) and Radio Frequency Identification (RFID). You’ve likely also been told about eXtensible Business Reporting Language (XBRL), which is currently being used by the Securities and Exchange Commission (SEC) in the creation of its new database system.
On top of keeping up with all the constant changes in tax and accounting rules and regulations, CPAs must manage their practices effectively while also learning to use the latest IT tools. Education is a necessity.
IT is here to stay. If you think this gigantic IT wave is hitting you hard right now, just wait. The next two to three years will be difficult, and the number of new IT products will increase dramatically. If you do not start preparing yourself now, you will be swallowed by the next killer wave.
First, a personal story to boost your confidence: I am an adjunct college professor, teaching accounting information systems and other related subjects. But 20 years ago, I knew very little English and was a complete IT idiot. I was so dumb that my auditing professor guaranteed me an automatic A-minus if I could figure out how to print out the content of a Lotus spreadsheet cell so that she could show the class the solution to a particular problem. In the end, I earned an A, and IT for accounting became my lifelong interest.
The moral of the story: If Fang can learn IT, so can you.
CPAs are shrewd business professionals by trade. We all understand that we are in a very competitive market that only the strongest can survive. There are myriad articles in print and on the Web that explain how important IT is for our profession. For example, in the August issue of The CPA Journal, P. Paul Lin and Kevin F. Brown’s article, “RFID Deployment: Considerations for Accountants,” gives us a preview of RFID.
Along with XBRL, these are the next two technological tsunamis that will be hitting us soon. Very soon. Therefore, I won’t waste any more of your time beating a dead horse—that IT is important for our survival. I trust that you have gotten the message.
Now, let’s discuss the various ways to educate ourselves to effectively manage this IT revolution.
As far as IT is concerned, what you need to learn totally depends on what you want to do for your practice. If you want to specialize in IT service for your clients, becoming a certified information technology professional (CITP) and getting formal training is highly recommended. Otherwise, just take some IT-related continuing professional education courses, attend the Society’s IT trade shows and stay up-to-date through reading IT-related articles in journals or on the Internet. Often, that is enough to gain adequate knowledge to manage most IT operations for your practice. In this context, “manage” means that you are capable of handling the routine operation and maintenance of a specific tool.
But for any task above that, you’ll need help from an IT specialist.
For example, let’s say you are contemplating purchasing an ECM system. First thing you need to do is to understand why and how this new technology would benefit your practice. Then you need to find an IT specialist to help you to select and install a specific system that can be integrated with your accounting, tax and other related systems. The installer will usually teach you how to operate and maintain the system. More complicated tasks such as a system upgrade, data migration and troubleshooting should be performed by an IT specialist.
I am a big fan of specialization, trade and outsourcing. They’re efficient. I always like to hire specialists to help me handle systems development or other IT projects, even though I’m a pretty good programmer myself. I occasionally write some patches, debug a few codes or offer suggestions to my IT professionals.
Very often, IT professionals need our accounting- or tax-related input (e.g., internal control and other operational constraints) to successfully develop a functional system. That is the biggest reason, in my opinion, why CPAs need to learn IT—so that we can work with the IT professionals more efficiently and effectively. If CPAs accomplish that, we’ll be able to surf these killer waves, instead of getting caught in the impact zone.
Jianing Fang, CPA, PhD, is a controller for a private corporation. He is an associate professor of finance at Pace University and teaches Taxation and Accounting Information Systems and International Accounting at Long Island University. He is also a member of the NYSSCPA’s Information Technology Committee. He can be reached at jfang@ambras.com.
