The Future of Accounting

[pro_bhanu]

I am interested in a discussion that would enable us to understand the
directions that accounting is taking and what people have to understand
so that they could cope up with their professional competition.

http://www.futureaccountant.com/

 

[Barrnabas Collins]

I am interested in a discussion that would enable us to understand the
directions that accounting is taking and what people have to understand
so that they could cope up with their professional competition.

http://www.futureaccountant.com/

I already know the exact direction accounting wil ltake in the future.

Between the interent, fax machines, UPS, every single accounting
job in the US will be shipped overseas to India/China/etc.

There is not one single function of an accountant that can't be
done overseas in India at a fraction of the price.

Not one. In this day and age with e-signatures there is no
reason why an aocuntant needs to be in the US. Face to face
dealing is nice but when face to face costs you $12,000
per year and an accountant in India can do it for $2,000
kiss face to face goodbye.

Time to brush up on your burger flipping skills.

 

[Wayne Brasch]

I already know the exact direction accounting wil ltake in the future.

Between the interent, fax machines, UPS, every single accounting
job in the US will be shipped overseas to India/China/etc.

There is not one single function of an accountant that can't be
done overseas in India at a fraction of the price.

Not one. In this day and age with e-signatures there is no
reason why an aocuntant needs to be in the US. Face to face
dealing is nice but when face to face costs you $12,000
per year and an accountant in India can do it for $2,000
kiss face to face goodbye.

Time to brush up on your burger flipping skills.

I believe you are entirely wrong about accounting. You must not be one. An
accountant who is properly trained can on a one-to-one basis with a
business-owner help keep that business from going bankrupt. In my case, I
don't charge an arm and a leg for that service. I consider it to be what
I'm expected to do as an accountant. All of my clients that have a business
appreciate my guidance in this respect. That can't be done properly by
someone in India or in any other country. There must be a close
relationship of client and accountant.

Wayne Brasch

 

[xyzer]

I already know the exact direction accounting wil ltake in the future.

Between the interent, fax machines, UPS, every single accounting
job in the US will be shipped overseas to India/China/etc.

There is not one single function of an accountant that can't be
done overseas in India at a fraction of the price.

Not one. In this day and age with e-signatures there is no
reason why an aocuntant needs to be in the US. Face to face
dealing is nice but when face to face costs you $12,000
per year and an accountant in India can do it for $2,000
kiss face to face goodbye.

Time to brush up on your burger flipping skills.

This makes sense honestly, but, what I don't understand is why, if what
you say is true, wages aren't already dropping dramatically for tax and
payroll accountants --the ones, if we're honest, most likely to have
been and to be affected by outsourcing. Like you say, the information
is already out there to do this and it _is_ being done right now. The
rate of outsourcing for tax returns has increased dramatically since
2000. But, what doesn't seem to be falling is the wages for good tax
accountants and payroll accountants here in the US. As far as other
accounting professions go, auditing and internal accounting that
requires complex estimates and the ability to know the general business
environment of the area you're operating in for certain complex
estimates that go into complying with GAAP --for big corporations
especially-- just seems cumbersome and not very efficient to move
solely to India. I can see many errors and misstatements coming into
play if this were to happen.

So, to get back to tax, just go on monster.com right now and look at
the wages desired for tax accountants and even payroll accountants.
The salaries are as high as ever. You'll see plenty of listings for
jobs paying 60-70K in not too expensive cities for a mid-level non-CPA
payroll person even. Perhaps what's going on is that the number of
jobs is decreasing and the people left with accounting jobs are thus
getting paid more or at least as much as usual. One should also
remember that as the wage of accountants seems like it might go down
due to foreign competition, college students won't be as likely to
major in it, raising the wage from what it otherwise would be had all
these students majored in it. But, honestly, 10 or even 20 years from
now, I just don't see tax accountants here in the US being that bad off
due to India. Even with computers, it's just too cumbersome really.

 

[Robert Anderson]

I believe you are entirely wrong about accounting. You must not be one.
An accountant who is properly trained can on a one-to-one basis with a
business-owner help keep that business from going bankrupt. In my case, I
don't charge an arm and a leg for that service. I consider it to be what
I'm expected to do as an accountant. All of my clients that have a
business appreciate my guidance in this respect. That can't be done
properly by someone in India or in any other country. There must be a
close relationship of client and accountant.

I am *not* an accountant but I fully agree with what you are saying. I have
a friend who is a tax consultant, and I believe that in addition to his
thorough knowledge of the business tax code he has outstanding communication
skills. In fact, I would say that the communication skills are probably
close to as important as the accounting knowledge and skills but both are
very important.

 

[Robert Anderson]

Barrnabas Collins wrote:
So, to get back to tax, just go on monster.com right now and look at
the wages desired for tax accountants and even payroll accountants.
The salaries are as high as ever. You'll see plenty of listings for
jobs paying 60-70K in not too expensive cities for a mid-level non-CPA
payroll person even. Perhaps what's going on is that the number of
jobs is decreasing and the people left with accounting jobs are thus
getting paid more or at least as much as usual. One should also
remember that as the wage of accountants seems like it might go down
due to foreign competition, college students won't be as likely to
major in it, raising the wage from what it otherwise would be had all
these students majored in it. But, honestly, 10 or even 20 years from
now, I just don't see tax accountants here in the US being that bad off
due to India. Even with computers, it's just too cumbersome really.

I know that accounting students are getting offers before they even graduate
from college. If the market for accountants is weak, I have not seen any
evidence of it.

 

[Gregory L. Hansen]

Not for long, with wage inflation what it is in India, and predicted by
the World Bank to become the fourth largest economy in the world by 2050.
It's hard to imagine the fourth largest economy in the world offering much
in the way of cost savings.

Then accounting jobs will be exported to Russia.

I believe you are entirely wrong about accounting. You must not be one. An
accountant who is properly trained can on a one-to-one basis with a
business-owner help keep that business from going bankrupt. In my case, I
don't charge an arm and a leg for that service. I consider it to be what
I'm expected to do as an accountant. All of my clients that have a business
appreciate my guidance in this respect. That can't be done properly by
someone in India or in any other country. There must be a close
relationship of client and accountant.

There are many accounting roles. Could be the jobs will be for those with
bachelor's degrees, while those with AAs and certificates will join the
computer programmers with AAs at the local Workforce office.

 

[Bluepen]

SarBanes-Oxly is one of the drivers of this.

I agree that doing low en tax returns and maybe doing sales tax and
payroll tax returns could be exported long term, but high leverl work,
like I do, will never be outsourced. I have been an accountant for 23
years... no one in India can be CFO of my organization remotely. I
would love to get payroll done, bills payed, etc, but polically it
would never work.

Lance Mertz, CPA
Ketchikan, Alaska

 

[Barrnabas Collins]

I believe you are entirely wrong about accounting. You must not be one.

Actually I am one.

An
accountant who is properly trained can on a one-to-one basis with a
business-owner help keep that business from going bankrupt. In my case, I
don't charge an arm and a leg for that service. I consider it to be what
I'm expected to do as an accountant. All of my clients that have a business
appreciate my guidance in this respect. That can't be done properly by
someone in India or in any other country. There must be a close
relationship of client and accountant.

But there is a price on that personal attention and advice.

What I have to charge $12,000 for someone in distant India
will be able to do for $2,000. It happended in Tech Support for
computers, it will happen in accounting in this "Global economy."

There is really nothing I can offer my clients that they can't also
offer in India at a fraction of the cost.

You site warnings about Bankrupcy. There is no reason why
someone in India (or their computer system) can't do the same thing.

I would add that there is a certain minimum for what I must charge.
(Electricity, Rent, payroll are fixed costs.)

When I hire another accountant in my office I have to pay them
many thousands of dollars. The same accountant probably gets
paid less than $100 a day in Inida.

People didn't complain when computer companies sent their
tech support to India where they could do it for alot less than
they do here in the United States.

Now that will spread to accounting and other areas. Bet on it.
Pure economics will force it to happen.

Why pay $12,000 when you get the same thing from Inida for
$2,000? Anything I provide my customer out of my office
in the United States can be provided from India.

Welcome to the global economy folks.

As an acountant get used to making $1.00 per day,
someone in India will gladly do it for even less.

 

[Barrnabas Collins]

That can't be done

That is where you are mistaken. They said the same thing
about computer support. Now most computer support is
done in India.

 

[Barrnabas Collins]

On Mon, 1 Aug 2005 03:13:34 +0000 (UTC),

Not for long, with wage inflation what it is in India, and predicted by
the World Bank to become the fourth largest economy in the world by 2050.
It's hard to imagine the fourth largest economy in the world offering much
in the way of cost savings.

Not when you go into countries where familiies essentially sell
their kids to a corporation for like $125.00 and then this kid
works as a slave for life.

It's not one world folks, and slave labor is allive in other
countries. In countries like Inida a coporation can go
and buy a kid for like $125.00 and have a slave for the life
of the kid.

Take a look at some of these countries we are competing
with.

Countries like China where you do what they tell you
or they will kill you.

 

[Barrnabas Collins]

This makes sense honestly, but, what I don't understand is why, if what
you say is true, wages aren't already dropping dramatically for tax and
payroll accountants --the ones, if we're honest, most likely to have
been and to be affected by outsourcing. Like you say, the information
is already out there to do this and it _is_ being done right now. The
rate of outsourcing for tax returns has increased dramatically since
2000.

But the poitn you're missing is that widget you bought for $30
ten years ago? They now make a copy of it in China for $2.00
using what is essentially slave labor.

That tax software that tax accountants use and is sold for some
outrageous price? Someone in China will pirate that software
(with China governent blessing) for pennies and soon
you'll have thousands of tax accountants undercutting
those of us in the US. It happens in computers, it will happen
in accounting.

Take a good hard look at computers in the world. That
Windows OS you just bought for $199.00 here in the US?
You can buy a pirated version of it for $5.00 in china.
And little things like validation, activation, and other
things to prevet piracy won't stop it. One of the next
steps will be accounting/tax software.

Another thing to keep in mind is what is to stop
people in China/India or other countries to
break into your computer and steal the
software/your data/your clients/your entire
business? If someone can steal your
identity why not steal your entire business?

 

[Barrnabas Collins]

I know that accounting students are getting offers before they even graduate
from college. If the market for accountants is weak, I have not seen any
evidence of it.

Give a few very short years.

 

[Barrnabas Collins]

I agree that doing low en tax returns and maybe doing sales tax and
payroll tax returns could be exported long term, but high leverl work,
like I do, will never be outsourced. I have been an accountant for 23
years... no one in India can be CFO of my organization remotely. I
would love to get payroll done, bills payed, etc, but polically it
would never work.

Lance Mertz, CPA
Ketchikan, Alaska

Except that when xxxxx corporation is owned by yyyyyyy corporation
in China guess where they are going to get their people from?

Alot of our corporations in the US are owned by international
corporations An increasing number are owned by Chinese
coporations (IBM sold out to Lenova).

That CFO for xxxx corporation in the US? He'll probalby
be flipping burgers in a few years and his job will be
sent over to China/India/etc.

Ask Carly Fiorina how safe her job is at HP. Oops, you
can't.....she got fired. It wouldn't suprise me if HP
is bought by some company in China and all the
employees come from China.

This is a world economy and the US is getting flushed
down the toilet.

 

[Ron Todd]

I know that accounting students are getting offers before they even graduate
from college. If the market for accountants is weak, I have not seen any
evidence of it.

I keep hearing that. I've heard it for the last decade. I just
haven't seen it. Every time I've called someone on it, show me the
job I'm ready to work, they do the dance and shuffle off in to the
moonlight.

If you think in terms of the de industrialization of this country, it
doesn't make any sense. Accountants are an overhead function of
business, as the business sector has contracted, you need less
accountants.

 

[Ron Todd]

I already know the exact direction accounting wil ltake in the future.

Between the interent, fax machines, UPS, every single accounting
job in the US will be shipped overseas to India/China/etc.

There is not one single function of an accountant that can't be
done overseas in India at a fraction of the price.

Not one. In this day and age with e-signatures there is no
reason why an aocuntant needs to be in the US. Face to face
dealing is nice but when face to face costs you $12,000
per year and an accountant in India can do it for $2,000
kiss face to face goodbye.

Time to brush up on your burger flipping skills.

I agree the technology, properly applied, has reduced the need for the
local accountant. What I really see is the deindustrialization and
concentration of what is left decreasing the need for local
accountants. For example, when Packard Bell folded and the market was
satisfied with ChiCom assembled PCs, you needed less accountants in
the U.S. When WalMart killed downtown, the work that was once done by
a multitude of small town accountants and bookkeepers could be handled
by a much smaller number in Arkansas.

 

[Ron Todd]

Give a few very short years.

I have seen the weakness first hand , and for the last decade. The
market is long past weak, it is almost non existent.

 

[me]

What I have to charge $12,000 for someone in distant India

will be able to do for $2,000. It happended in Tech Support for
computers, it will happen in accounting in this "Global economy."

Been reading a book called "The World is Flat"

It talks abt that very thing happening right now.