I come from a long line of accountants.
At the turn of the 20th century, my grandfather’s family emigrated from Russia and arrived in the United States looking for a better life. Settling in an immigrant area of St. Paul, Minnesota, my grandfather was born just a few years later in 1903 and would go on to become a CPA. After recently researching my grandfather’s family, I was shocked to find that his brother followed suit and that his sister married a CPA. In pursuit of a stable job and a better future, they all worked together in St. Paul.
You don’t have to search hard or ask too many people to find out that the accounting industry has evolved quite significantly since my grandfather’s era. A firm believer that we have to look to our past in order to guide where we’re going, I recently decided to dig into the origins of accounting in an effort to navigate the current accounting revolution.
CPAs of the 1930s—my grandfather’s generation—were committed to providing value to their local communities and neighborhoods. Like my grandfather, great aunt and great uncle, everyone lived and worked in close quarters, in turn driving collaboration and in-depth client relationships. At the time, commitment to clients extended as far as accepting goods for service instead of traditional payments. For my grandfather’s generation, business was relationship-driven and accountants were the strategic partners.
Fast forward 85 years or so and you get today’s generation of accounting. As a result of the technological innovation that has occurred over the past eight decades, many accountants believe their value is being diminished. I’d argue quite the contrary and firmly believe that technology is actually driving a shift back to the client-first mentality, subsequently making accountants more valuable than ever before to small business owners.
Take, for instance, that my grandfather’s generation of accountants relied solely on manual calculations. Despite this, they still had time for relationship building as the accounting standards were not as complex as they are today—at the time, a standard 1040 form was only a few pages long, now it has over 174 pages.
While the introduction of desktop computers in the workplace helped accountants keep pace with increasingly complex accounting requirements, early technology simultaneously began to draw accountants away from their clients and into siloed offices with heavy workloads. Walls went up, heads went down, and the profession became more isolated.
The good news is that the emergence of cloud technology has broken down said walls and is empowering accountants to rebuild the communities that were so prevalent in my grandfather’s era of accountancy. How? At its core, cloud software allows users instantaneous access from anywhere at any time. As a result, accountants and clients, from coast-to-coast and even overseas, can seamlessly collaborate together in real time. Take, for example, the ability to feed daily bank transactions into the system. This cuts down on the reconciliation process, in turn allowing CPAs more time to do what they do best: interpret the data and provide value to clients.
Thanks to the cloud, across the country, we’re hearing client conversations shift from “I don’t know what my CPA does, but I think I get value from them” to “I can’t imagine not having my CPA as part of my business.” Put simply, we’re actually going back to this pre-1950’s client-centric way of thinking and doing. We’re becoming more than CPAs; we’re being leveraged, once again, as trusted advisors.
They say the only constant in life is change. So in order for us to recapture the spirit of my grandfather’s era—meaningful client-accountant relationships—our only choice is to embrace current technological changes and run with them. By doing so, we can capture the best of our past in order to thrive in the future.