Save The Blue Frog

Tag: news

  • Concerned That A.I. Will Destroy Your Accounting Career? Establish Your Future In The Profession’s One (Obvious) Area Of Job Growth

    The Risk Of Excessive Reliance On AI Functions

    Last week, at TXCPA Houston’s annual Fall Accounting Conference & Technology Symposium (F.A.C.T.S.), speaker after speaker addressed the future prospects of A.I. Although much of the content was optimistic in tone, an undercurrent of concern permeated the presentations.

    Why? It’s likely that A.I. applications will soon be capable of performing many current human functions in accounting and finance. Thus, if you’re a staff auditor who “traces and agrees” numbers that appear on different computer screens, or if you copy numbers from accounting documents to income tax forms, your activities are particularly vulnerable to automation via A.I. systems.

    There is a specific career path within the accounting sector, though, that will likely experience explosive growth because of A.I.’s increasing use. The Symposium speakers referred to it as A.I. Governance and Risk Management.

    Why is that a growth sector? Any new technology that performs an important activity inevitably malfunctions from time to time. Audit assurance activities must thus be applied to it, and measurements must be devised to manage the risk of technical failure. And over time, as any technology grows more proficient at lower-level tasks, it is inevitably applied to higher-level tasks, thereby generating the need for higher-level assurance activities.

    It may seem ironic that this projected job growth is expected to arise within the assurance function, a traditional service on which the entire public accounting profession was founded in the late 1800s. Nevertheless, if you’re concerned about establishing an accounting career path that is vulnerable to being rendered obsolete by A.I. applications, you may wish to consider a role that addresses the risks of implementing such activities.

    Information about the A.I. Governance and Risk Management functions can be found on the web sites of the Big Four accounting firms and many other assurance practices. Consulting firms outside of the accounting sector publish helpful information too, including those owned by firms in the human resources sector. And more technical information can be found on the web sites of publications that focus on data security and process management.

    Furthermore, to communicate directly with the authors, speakers, and thought leaders of the profession, you might consider attending future conferences of TXCPA Houston. The organization, for instance, has already begun to develop its 2026 Spring Technology & Accounting Resources Summit (S.T.A.R.S.). A.I. topics are sure to play a prominent role in the agenda of that event.

  • For Sustainability Accountants, New Entities Step Forward As The Federal Government Steps Back

    Private Sector Accountants Arrive As Federal Government Accountants Depart

    Sustainability accountants may have been worried when the U.S. Securities & Exchange Commission (SEC) permanently withdrew its climate change (carbon emissions) reporting requirements. What would they do? Were their jobs in jeopardy?

    Apparently, their employment prospects weren’t bleak after all. Last month, the private sector stepped into the void with the launch of the Task Force for Corporate Action Transparency (TCAT). The entity published new corporate standards regarding the reporting of climate change information, emphasizing the need for third party assurance (i.e. independent audit) activities on the data. The Wall Street Journal noted that Netflix, PepsiCo, and eleven other companies were already pilot testing the guidance.

    Likewise, accountants in the medical sector may have been concerned when the U.S. Department of Health & Human Services ceased the collection and reporting of various health metrics. Once again, though, a new entity emerged to assume this function.

    Which entity? Fifteen U.S. states announced the launch of the Governors Public Health Alliance. The group pledged to “share best practices, exchange data and collaborate on emergency response, vaccine policy and other technical issues,” activities that were once performed by federal government agencies. Two other alliances of U.S. states, one located in the Northeastern United States and the other on the Pacific Coast, previously announced similar pledges.

    Professionals across the political spectrum may be well-advised to review the output of these new entities. Those who believe in the federal government’s efforts to limit public reporting may need to understand how these new initiatives are attempting to replace the data. Conversely, those who support the principle of public reporting may need to implement the new guidance.

    Interestingly, it appears that sustainability accountants will continue to be “in demand,” regardless of the federal government’s role in defining relevant metrics and standards. As the federal government steps back and eliminates its requirements, other parties are stepping forward and establishing new expectations.

  • Storm Flooding Catastrophes: Assessing A Region’s Response Capability

    Why We Need Regional Catastrophic Readiness Functions

    Two weeks ago, a storm flood surged through the Hill Country of central Texas, inflicting more than one hundred fatalities. Last year, Hurricane Helene caused a similar level of damage in North Carolina and other southeastern U.S. communities. Neither of these events, though, matched the destructive power of Hurricane Katrina in 2005; striking New Orleans and surrounding communities, it was responsible for more than 1,000 fatalities.

    Commercial and residential property owners, insurers, and mortgage lenders must assess the capabilities of regional response functions to minimize the enormous social, financial, and environmental costs of such storms. Can they learn from the experience of the Hill Country storm, the most recent event to generate such catastrophic losses?

    Yes, they can, if they utilize a standard set of analytical questions that should be applied to all regional catastrophic readiness functions:

    a. Is an entity held responsible for assessing the region’s catastrophic readiness?

    b. Does that entity develop and publish a plan to maintain its readiness?

    c. Can the region implement the plan when a storm strikes?

    d. Does the plan employ standardized metrics that are defined by credible organizations?

    e. Does an independent entity review the assessment process on a periodic basis?

    Professional analysts will inevitably agree on certain answers to these questions and disagree on others. It’s important, though, that they all utilize the same publicly available information to develop their informed opinions. For instance, regarding the Hill Country case:

    a. The web site of the Texas Water Development Board’s State Flood Planning function contains material information about flood assistance programs, management training, community resources, and other relevant functions.

    b. The web site of the Development Board’s State Flood Plan contains significant supporting information about the state’s “… effort to perform comprehensive planning to reduce flood risk and take a broad look at flood hazard across the state.”

    c. The 245 page PDF document entitled 2024 State Flood Plan is the most recent comprehensive state-wide plan; thus, it reflects the current status of the region’s readiness to respond to catastrophic floods.

    Reasonable minds may certainly differ about how the data in such sources may impact an assessment of a regional response function. Nevertheless, reasonable minds should all agree on the relevance of the (above) five questions and the need to utilize a region’s published information for assessment purposes.