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TWR Podcast Episode 88: Is Bookkeeping Dead?

Posted by Matt Raebel on Jun 5, 2024 3:00:00 PM

Is bookkeeping dead? This intriguing, if controversial question is currently a divisive topic in the accounting industry.

Given the prevalence of platforms like Intuit QuickBooks and H&R Block—not to mention the talent shortage—it’s easy to see why many are hesitant to dismiss the question as mere doomsaying.

Here’s the answer: bookkeeping is not dead—but it is dying.

Joe Woodard and Heather Satterley discussed this provocative topic on the latest episode of the Woodard Report Podcast. The discussion covered the current state of bookkeeping, its evolving nature, and the implications of emerging technologies on the profession.

The takeaway? Even if bookkeeping as we know it is dying, it may also be evolving into something new.

The evolution of bookkeeping

The duo kicked off the episode by emphasizing that while bookkeeping isn't necessarily dead, it is undergoing a significant transformation.

For example, the traditional notion of what bookkeeping “is” is changing, driven by technological advancements and industry terminology shifts. “What is going to be dead eventually is the term ‘bookkeeping,’” Woodard said. “And if it's not dead, it will no longer be defined in the way you're defining it now.”

Woodard referenced the ongoing effort by the American Institute of Certified Public Accountants (AICPA) to redefine the term "CAS" from Client Accounting Services to Client Advisory Services. He argued this shift reflects a broader trend in the industry toward providing more comprehensive and strategic services to clients beyond basic bookkeeping tasks.

While bookkeeping remains a crucial part of these services, it is increasingly being integrated into a larger framework of financial advisory and accounting services, involving more complex tasks like accrual accounting, real-time financial reporting, and strategic business advice, which are essential for helping businesses navigate today's dynamic economic environment.

The role of technology in bookkeeping

The role of technology in transforming bookkeeping, particularly artificial intelligence (AI) and quantum computing, is driving much of this change. Woodard and Satterley discussed Dr. Michio Kaku's predictions about the revolutionary impact of quantum computing combined with AI, suggesting that these advancements could fundamentally alter the landscape of bookkeeping and accounting.

Despite the rapid technological advancements, the human element in accounting and bookkeeping remains irreplaceable. Satterley noted that while AI can process data and perform complex calculations, it lacks the ability to understand the nuances of human emotions and values that are critical in making certain business decisions.

She emphasized the need for accountants to stay informed about technological advancements and understand their implications for their businesses and clients. She also mentioned the importance of trust and verification, including the need for humans to perform their due diligence when dealing with artificial intelligence tools to avoid the mistakes they tend to produce.

“It's exciting in the sense that there's new technology...we need to be really careful with this technology in the sense of relying too much or too little on it.”

Scaling New Heights 2024

The episode wrapped up with a brief celebration of the 2023-2024 Woodard Top 50 Client Accounting Services (CAS) award firms. These firms exemplify excellence in client accounting services, showcasing best practices, innovative approaches, and a deep understanding of their unique value propositions.

The award winners will be honored at the upcoming Scaling New Heights conference, providing an opportunity for networking and learning from the best in the field.

For more information about Scaling New Heights 2024 and the Top 50 CAS Awards, check out our website.

 

Listen to the podcast episode below:

 

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Topics: Finger on the Pulse, Business Technology, Podcast


 

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