So, I had an interesting conversation a week or so ago. It was about accounting as a profession. What I realized out of the discussion was the extent to which some accountants view the profession as being a mastery of compliance regulations. That is, they've spent a substantial amount of time developing a deep understanding of this or that regulation which dictates this or that required reporting, and to them that is what constitutes accounting.
The conversation brought a few epiphanies to me. First, I think I understand the resistance a bit better, for that group in the profession, compliance reporting is their "thing", in many cases it is their livelihood. In my experience, whenever someone's thing is challenged, it is viewed as a strike on their worth and value. Of course, they will respond aggressively and defensively.
Second, the conversation challenged me to be better able to articulate the value of my aspect of the discipline. Compliance may be fading as a value-added discipline but it does have an easy task in explaining why it is necessary. Management accounting with its focus on principles and problem solving must be better at articulating the necessity and value creation it brings.
Lastly, it saddened me a bit that the corners of the discipline are so far apart. Not so much that there are stark differences in the branches of the discipline, but that there is too much dismissal, or even antagonism, at times between the branches. I may not like auditing, took me one auditing class to figure out I didn't want to do that, but an auditor is still an accountant. Now, they may have a really steep learning curve to step into the FP&A work I did in practice, as I would if I tried to join an audit team, but that doesn't mean either of us is not an accountant.
JP … Thank you for your post.
My observation is that the problem begins with the imbalance of emphasis of external statutory and compliance financial reporting for government regulatory agencies (e.g., the USA’s SEC) and investors dominating over internal management accounting. The purpose of the former is for “valuation” (e.g., inventories, cost of goods sold) whereas the latter’s purpose is for “creating financial value” for shareholders and owners by providing insights for better decisions.
Most CFOs (those “CFno” ones) and accountants place their emphasis on the former rather than the latter. This imbalance needs to be corrected.