The International Federation of Accountants (IFAC), the global voice of the accounting profession, has released the results of its recent survey, conducted online by Harris Poll among over 1,000 adults ages 18+ in India, which tests public perception of key issues facing the accounting profession in India. The survey presents findings on various areas, including fraud and corruption, India’s newly implemented GST, as well as the impact of technology on the future of the accountancy profession.
The survey found that while 70 percent of adults in India think that new technologies (e.g., blockchain, automation, artificial intelligence (AI)) will replace professional accountants in the next 10 years, making them obsolete, 64 percent say they would not trust AI, alone, to fulfill their personal and business accounting needs. While these findings may seem contradictory on the surface, they are in line with the consensus around how technology will play a large part in transforming the accounting profession, enabling accountants to play a more strategic and analytical role for their clients in the future.
“This is an exciting time for the accountancy profession in India and around the world. With the impact of technology and rise of AI, a lot of the traditionally manual tasks of accountants are being automated,” said Rachel Grimes, President of the International Federation of Accountants. “This sea change presents an opportunity for accountants to focus on providing strategic advice and better business guidance to the organizations they serve.”
It is expected that by 2020, India will have the largest job ready, youth population in the world. “Automation and the increased use of AI in the profession also presents an exciting opportunity for the next generation of accountants to become well versed in these new technologies at an early stage in their career. This allows them to provide valuable business insights throughout the audit process that would have been nearly impossible ten years ago,” added Grimes.
Small and Medium Enterprises (SMEs) form the backbone of the Indian economy, with more than 50 million SMEs, expected to contribute close to 50 percent of the country’s GDP by 2020. Nearly 80 percent of Indian’s surveyed said that they would likely use a professional accountant if they were setting up a business. “SMEs make up an increasingly large part of India’s economy, and the accounting profession plays a critical role in helping drive small business growth, financial transparency and success in India,” said Grimes.
In July 2017, India implemented the GST bill, a landmark decision that aims to solve long existing challenges prevalent in the current taxation system. For SMEs in particular, the GST bill will help eradicate indirect taxes, provide more transparency of the tax process, draw projections of production cost and make access to new geographies for business expansion more accessible. When asked about India’s largest reforms over the past year, 64 percent of Indians believe the newly implemented GST has disrupted the businesses community in the country. That said, 76 percent think that a knowledgeable accounting professional is essential for businesses to be compliant with GST, underscoring the willingness for compliance and the trust of people in the acumen and expertise of accounting professionals.
Fighting Fraud & Corruption
It’s no surprise that organizations have to constantly deal with corruption challenges in today’s business environment, especially with increased technological complexities presenting more opportunities for fraud.
The survey findings reveal that one-third of Indians believe professional accountants play a major role in combating fraud and corruption in the country, with 80 percent noting that the accounting profession enhances the financial transparency in India’s economy.