Over the next 50 years, I believe we will see tremendous changes in the ways that information and accounting are tied to one another, and the ultimate winner in this revolution of course will be our civilization, but on a much smaller scale, the accounting profession. Just as has been previous experience, there are winners and losers in every kind of revolution: in the industrial revolution, the outdated manual processes were replaced with much faster and cheaper mechanized processes, and the industrial revolution made tycoons and beggars of business men, from all walks of life.
The speed with which the computer has brought information access to our doorstep and the ease of availability has only just begun to impact our lives. The graduating youth of today, will see drastic shifts in the use of information and the coordination of that information with business processes. Traditionally, the accountant has been the bearer of the reactive news. In other words, only after the process was complete, could the accountant furnish information about the profitability. Today, thanks to the computer and real-time reporting, managers, supervisors, business owners, and even our government, can act upon current information to create a more profitable business outcome.
What does this mean for accounting? It means that we will begin to apply accounting in a whole new way: information accounting. Information accounting is not just numbers. It's a new way of conducting business through the use of better and more meaningful information. When MIS (Management Information Systems) was created, it was originally made a part of many accounting departments, but soon grew too large for inclusion in one department. The management of information has become a department of itself, and applies to all areas of business. However, as we progress, the original idea of tying this to accounting has not diminished; in fact, the need for successful coordination of information with accounting figures has grown. Now, we're moving accounting to a new level, and growing the accounting concept to match the information concept.
I think we will see a division of the traditional accounting process; data entry and the mundane tasks of reconciliation and closing have become almost too routine thanks to computers. This lower level function of accounting is necessary, but does not require the expertise that the use of the resulting information does in the business application. The accounting profession must rise to the occasion and create an information accountant that is truly worthy of the title; it will require education in both accounting and business. Although more education will be required, the rewards for the successful implementation of information and accounting will spell greater success for businesses, and accountants.
The greater availability of accurate and timely information, coupled with the need for faster reaction time in business, will do for many businesses what the industrial revolution did for assembly manufacturing. Some will win, some will lose. The real winners in this revolution will be the upcoming accountants and business owners of tomorrow, who recognize opportunity, and seize the moment!
Information is for educational and informational purposes only and is not be interpreted as financial or legal advice. This does not represent a recommendation to buy, sell, or hold any security. Please consult your financial advisor.