Accounting is inherently a data-driven profession.
Spreadsheets laden with numbers from financial reports and tax filings are staples of the profession. But transitioning from a paper-heavy approach to one driven by digital tools, with sophisticated technology to generate deeper insights from those reams of data, has been a struggle for many smaller firms, exacerbated by the continued shortage of new workers.
Add a pandemic that forced many companies to shift to remote services and an increasing demand from clients to create more data-driven financial strategies, and the industry has “been brought to its knees,” according to Melissa Travis, president of the Rhode Island Society of Certified Public Accountants.
Seeking to address a lack of understanding in how to incorporate data analytics into accounting practices, the RISCPA recently announced a data analytics course for local accounting firms and manufacturing companies.
The three-day virtual course on Dec. 4, 8 and 9 is the brainchild of Travis and R.I. Department of Labor and Training Director Scott R. Jensen, funded through a portion of the $45 million federal stimulus money the state allocated to the Back to Work RI program.
With participation nearing 100-person maximum capacity, Travis hoped to hold a second iteration, with visions for what she hoped to be a long-term effort to give her industry a fighting chance at survival through data analytics.
‘We have to be able to navigate this new world ... using unstructured big data.’
ANDREW PARRISH, Diligentiam CEO and president
“If we don’t do this, these industries won’t be able to keep up,” said Travis, adding that she hoped the training will position the state for a faster economic recovery, too.
Among those firms sending workers to the training is Diligentiam, a North Smithfield-based accounting and financial services consultant. Unlike some companies just starting to embrace the power of data analytics, Diligentiam CEO and President Andrew Parrish prioritized the tools, technology and training from the get-go.
Still, the pandemic has created new needs among client companies to use not just descriptive analytics − which show trends and analysis on what has already happened − but predictive analytics that look to the future economic climate and financial repercussions.
“Because of COVID, the past plays a less-important role because it’s just a totally different business world out there,” Parrish said. “We have to be able to navigate this new world ... using unstructured big data.”
While Parrish’s company has two trained data scientists developing their tools and technology, most of his workers are in financial services, business strategy and what he called “lean-management” fields. The more-senior employees have some understanding of data analytics as it relates to their areas of expertise and client services, but Parrish plans to send three or four “junior” workers to the RISCPA training to help them bone up, and in turn share that knowledge with clients.
“To be the consultant, you have to be able to understand the impact of new technology,” Parrish said. “You’re not doing your clients a service if you don’t understand it and can’t apply it.”
Brian Berry, director of the technology advisory group for Blum, Shapiro & Co., agreed.
While most of the firm’s accountants are proficient in Microsoft Excel, other visualization tools and software, such as the Microsoft Power BI program the RISCPA training is specifically geared toward, are less widely understood. Yet, once taught, these programs give employees a much broader set of tools to analyze and display data, with applications ranging from measuring worker productivity within the company to comparing average, maximum and minimum cost and profits for a client.
“You can see that data in a financial statement but to really understand it, you need that visual report that’s interactive, that slices up the data,” Berry said.
Blumshapiro has also made some forays into artificial intelligence to augment and speed up what would otherwise be a laborious human-led process. For example, AI tools allow the firm to quickly scan hundreds of a client’s financial documents to determine which are relevant for an audit.
The efficiency that data analytics brings is perhaps the greatest benefit to Jonathan L. Ucran, certified public accountant and owner of Ucran & Co. LLC.
Rather than a “dumpster dive” into a client’s ledger or accounts payable list, data analytics creates an efficient mechanism to sort and parse information into accessible, understandable trends and outcomes. And time has become increasingly precious since COVID-19 hit, with his company inundated by requests from clients in bookkeeping and financial services.
While larger accounting firms, such as Kahn, Litwin, Renza & Co. Ltd., have opted to offer their own in-house training programs on data analytics, smaller companies often lack the resources to create and carry out such courses, Travis said.
Parrish framed the training through RISCPA, which will be led by a national training company the society has hired, as the best “bang for your buck” for his company.
Nancy Lavin is a PBN staff writer. Contact her at Lavin@PBN.com.
