ICAEW IT Faculty's technical manager Kirstin Gillon considers the ethical questions raised by Freddie Faure around accountants' increased reliance on technology and automation.
The institute is on a journey in researching and reviewing the role and future impact of emerging technologies on the profession.
Technology and ethics is a global theme
“Technology and ethics is a very hot topic globally,” said Gillon. “However, two useful areas are around how important it is to stress both ethics and accountability (the latter is a bit left behind in the debate), and secondly clarity around the issues. In particular, these are business issues rather than purely technical ones and does require broader engagement.
“In this context, the Institute and the profession have an important role to play, especially around areas of corporate governance and quality; and how this impacts on the relationship between business owners, their professional advisers and boards”.
For Gillon, the global context is as important as the domestic, especially as business, technology and data are increasingly cross the border. “Applying the question of ethics internationally raises important but significant challenges, not least around responsibility, but also how businesses culturally deal with things differently.”
There are specific issues which affect accountants. “How tech impacts professional judgements is a complex area, especially in thinking about what might go wrong and what you should do in these circumstances. It continues to involve research, thinking and work right across the institute, covering a very broad range of areas”
Gillon is clear where accountability should lie.
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Accounts, technology and accountability
“The accountant is always responsible, and there must be enough understanding that you know what is going on. It’s not that accountants need to be coders, but we can’t just say we use tech and that’s that. There does need to be a sufficient level of knowledge in the systems being used to ensure it is not just blind trust,” continued Gillon.
Given that some of this technology is increasingly advanced, Gillon underlines the role of the institute to help develop the necessary skills and understanding.
“We recognise greater tech knowledge is important and part of the profession, and we are constantly looking at exactly what needs to be known.
“Ethics and accountability and the human part are crucial, so we have updated the qualifications. But we also need to stress that due diligence, process knowledge, and cybersecurity risks are areas that we would expect accountants to be thinking about.”
Areas such as artificial intelligence (AI) provide other challenges.
AI: The balance between outputs and explainability
“Whether we should understand what it is going on or just trust the outputs of AI is the big question and not unique to accountancy.
“Financial Services is at the forefront here where the models are simply not explainable. The outputs are seemingly better, but they can’t explain it. The answer at the moment is to stick only to things they can explain”.
Gillon also talked about how the rules of engagement for accountants with AI are still not clearly defined.
“How do we manage this process for accountants? What are the checks and balances that need to be in place and guide the decision making? It’s still very early stages, and the thought of using models people don’t understand feels too risky for some.”
She believes training within the profession is a significant factor in mitigating some of this risk. “You don't have to always understand the technology, but critical decisions are understood and are where professional judgement comes into play”.
So where does the responsibility lie in ensuring quality is maintained?
Critical thinking is key
“Technology is only part of the picture. It’s important that the profession has the right level of technical literacy, business knowledge, and critical thinking at the core. This is essential for the future and for maintaining standards,” said Gillon.
“You need to be able to frame the right questions both to provide the service to clients but also to make the demands on the technology.”
Having a broad set of skills and knowledge is important to ensure that accountability is maintained, especially if things go wrong.
“It could become complicated, especially if there is a deep mix of technology, data and users. However, an accountant should never be in a position to say ‘no, it wasn’t me’.”
So to what extent is technology now a professional commitment?
“I would say an accountant needs to be competent. They have always used tech, but the level of competence goes hand-in-hand with escalated usage. As an institute we don’t force technology; however, we naturally expect and support a level of understanding and skill to be able to use properly,” said Gillon.
“You can see this increasingly in the way that technology is embedded in the qualifications across a whole range of modules. These skills and abilities around technology, data and analytics are important pillars”.
So will an accountant’s compliance role in the future be as much about policing systems as driving results?
A changing role
“The role of the accountant is changing over time, especially as changes in process evolve,” commented Gillon. “Although perhaps not policing, we can see an increased role for keeping a check on how things are running and in ensuring quality which is after all what clients are after: assurance and quality.”
So the conversation around the role of technology and its impact on accountants continues, and Gillon has an understanding of where this should be leading.
“Accountants need to have ethical framework, and depending on your role this can be very context specific.
“It’s a broader conversation that we are only part way through, but what we should be looking for is not a tick box compliance process, but something that is naturally part of behaviour and values.”
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