The roles of finance professionals are expanding at a fast pace in a constantly changing global economic environment, new AICPA research shows, creating an urgent need for accounting and finance professionals to grow their skills.
An overwhelming majority (85%) of CPAs who participated in a recent survey said the role of the CFO and the finance function has expanded moderately or significantly in their organization. And 94% predict that the level of complexity in business will increase over the next three years.
“We have huge uncertainties in the marketplace,” said Mick Armstrong, CPA, CGMA, the CFO of Micro 100 Tool Corp. in Meridian, Idaho. “Whether you’re looking at health care, whether you’re looking at expected increases in regulation from the government—all of those change the risk environment, and it’s very difficult for businesses, be they private or public, to assess, how am I going to deal with this?”
One thing is certain. Businesses are turning to the finance function to help deal with these changes and complexity. This puts finance professionals in an enviable position of influence. But increased skills are needed to meet additional responsibilities.
More than half of the more than 1,234 qualified respondents to the survey said that, in addition to traditional financial accounting and reporting, they are focused on the following areas:
- Risk management, including internal controls (67%).
- Strategic business planning (58%).
- Accounting information systems, including IT development and cybersecurity (55%).
Organizations continue to be aware of the risks in their midst, yet barriers remain for implementing enterprise risk management (ERM) initiatives.
More than half (57%) of companies acknowledge that the volume and complexity of risks have increased “mostly” or “extensively” in the past five years, but the number of mature ERM programs appears to be leveling off, according to a survey, available at tinyurl.com/p5z6twv, conducted by the ERM Initiative at North Carolina State University for the AICPA.
Companies are “seeing a more complex risk world, but they’re not yet investing at any higher levels in strengthening their risk oversight in a general sense,” said Mark Beasley, CPA, Ph.D., a professor at North Carolina State University and one of the survey’s authors.
About 15% of the 446 senior executives surveyed believe that their organizations’ risk management processes are “mostly” or “extensively” a proprietary strategic tool that provides competitive advantage. That’s down about a percentage point from the previous year’s survey.
The top five barriers to ERM progress listed in the survey were:
- Competing priorities (chosen by 51% of respondents).
- Insufficient resources (43%).
- Lack of perceived value (41%).
- Perception ERM adds bureaucracy (33%).
- Lack of board or senior executive ERM leadership (30%).
Beasley said barriers such as lack of perceived value keep cropping up in the survey because companies haven’t linked ERM with strategy.