When you think about the absolute basics of accounting have largely remained unchanged in the last 100 years no less the last 10. Identifying incoming money or revenue and calculating the outgoing expenses of a single individual or a large multinational the basic tasks remain the same. That is about the only thing that has remained the same in that span.
To say that the financial world has changed a little in the last 10-20 would be akin to saying that the change from walking on all fours to becoming bipedal was relatively small change. The “products” that banks now offer have become so intricate and sophisticated that is literally defies logic how anyone could make sense of some of the ins and outs of these markets. The derivative market alone has evolved into a beast unto itself that few outside of the banks and Wall Street even really understand what they entail. Yet, the accountants are the ones left holding the bag and doing all the explaining when something does not go the way it should have.
Technology has further enhanced this by allowing the entire global financial market to be completely intertwined to the point where what happens in the financial markets in Great Britain or Singapore will ramifications in New York or Toronto in almost real time. This is a phenomenon that has never been experienced by the financial services sector until the last 10 years or so.
The pressure on accountants and auditors to unscramble this jigsaw puzzle and explain it to both regulators and investors is extremely heavy and they do the absolute best they can under terribly difficult circumstances at the best of times. Trying to understand and explain the multitude of layers that the financial wizards in the banking sector create has been a job that is not for the faint of heart. If you look at the subprime loan scandal in 2008/2009 it was the accountants and auditors who were left to pick up the pieces and try to put it all back together again when things fell apart.
Without the accountants and auditors nobody would have known what was going on and the situation could have taken an even darker turn with many more banks and other financial institutions than just the ones that failed going under. The future of accounting has changed and the people who enter into the profession need to be even smarter and brighter than ever before, the good news is many of them truly are.
