As accountants increasingly innovate with data, AI and other technologies, is the profession’s ethics code fit for purpose in this new world? We wrote about some of the issues in our New technologies, ethics and accountability report and in February, IESBA published a report by its Technology Working Group (TWG) which examined some of the challenges in more detail. Here are a few of the key points.
Fundamental principles – accountability and privacy
The ethics code is based on five fundamental principles - integrity, objectivity, professional competence and due care, confidentiality and professional behaviour – and the review concluded that these principles are broadly fit-for-purpose. However, the TWG also compared the accountancy approach with emerging tech ethics frameworks. These typically emphasise principles such as privacy and accountability, and the report recommends more clarity or work in some of these areas.
New threats related to technology
The threats to ethical behaviour faced by accountants are another key component of the current approach. The threats which are outlined in the code today are fundamentally grounded in human contact. To some extent, greater use of technology can help to reduce the threats – after all, an algorithm can’t be intimated by a client or give a friendly client an easy time. But greater reliance on new technologies does raise new threats, or can change the nature of the existing ones. For example, the threat of ‘intimidation’ could be rethought and expanded to cover the idea that an accountant is intimidated by the complexity of the technology and doesn’t challenge the outputs enough.
The impact on skills
We have talked a lot about the changing skills requirements for accountants as a result of technology, such as more skills in data and digital technologies more broadly. But are we reaching a point when it becomes imperative for accountants to improve their skills around technology in order to be professionally competent? Interestingly, the report focuses on the increasing importance of soft skills in this regard. While there are emerging technical skills to consider, it highlights skills such as communication, agility, collaboration and problem solving, as well as a mindset of continuous learning.
The report makes a variety of recommendations, including the development of new material to provide more non-authoritative guidance on these issues, and further review of a range of issues. There is also a working group looking specifically at issues related to blockchain and cryptocurrency. So this is very much the beginning of a stream of work on technology and ethics and we welcome continuing research, review and debate. If you’re interested in getting involved, contact me.
A fuller version of this article is available for Tech Faculty members.