Globalization's Impact On Accounting Career

Today the term globalization has become more popular to people. The world’s economy has tuned to a new age that trading between countries is easier than ever. Yet, globalization has affected and really changed the world from heavy industrial, manufacturing, services, transportation, and education.  It even affects on the accounting careers today.

            In this paper I will focus on three main issues of globalization that affects on accounting careers in the near future.

The role of Information technology affects on accounting career

International students and new immigrant population 

Changing in International trading between countries

The rapid growth Information system and the Internet not only changes the way people trading, but also changes accountant’s roles. The accountant’s role has been expanding within organizations and they are becoming part of the management and decision-making team, rather than just providers of financial information. Corporate accountants must shift priorities from analyzing past events to acting as strategic partners, advisers and information providers. Already, accounting and finance professionals are mining data, turning information into knowledge and communicating what they learn to all levels of the organization. This is a result of having a new option in accounting education. Most colleges and universities realize the importance of information technology, so they have added a new track that is called Accounting Information System to their school program.

Internet and information technology created a revolution in storing, managing, and using business databases. Some traditional accounting job will be cut in the near future with more and more people use accounting software for tax preparation. Additional advancements in information technology further reduce the need for accountants and auditors. However, Increase of applying information to accounting will create new jobs. And those new jobs will require accountants to receive more education. They will be hired into positions to develop, maintain, and monitor new systems. Because there will be larger volumes of information to report and the increased complexity of reporting mechanisms, demand for auditing or monitoring services by both internal and external auditors should also increase in the future. According to Bureau of Labor Statistics, “Individuals who are proficient in accounting and auditing computer software and information systems may have an advantage in getting some accounting and auditing jobs.”

Globalization opens opportunities for international students to study in the United States. The number of international students who go to college to major in accounting in the US is increasing. This will have both positive and negative impacts on accounting in the US. A large number of international students will be a good source for accounting in both the Us and countries. The US will be able to take advantage of international accounting students as they return home and implement what they have learned. However, there will be a large number of students who will stay and work in the US after graduation. This will create an unbalance in supply and demand in the US accounting job market. 

With the effect of globalization, today accounting students can work for the big 4 companies in Asian countries or for accounting firms in European countries. Future accountants in these positions will require more traveling and additional education. Since accounting systems are still different in different countries, accountants need to study different rules. The most important skill would be understanding and communicating efficiently in a different culture. English is still the first choice in international trading, but Spanish and some other languages are also necessary.

According to USA Today, “In an interview, Sir David Tweedie, chairman of the International Accounting Standards Board in London, says the growth of the global economy means “we must eventually end up with a common system of regulation, auditing and accounting.” Change in International trading between countries is the beginning of change the accounting rules. This will be a big challenge for international accountants. A common rule for accounting might be made to simplify the accounting job. In addition, most of the companies in the US need to expand their market to remain competitors. When those companies globalize, they also need to globalize their accounting system.  A switch from GAAP to IFRS will be a good solution. Currently, there seems a hesitance in switching because the change from GAAP to IFRS may affect to the benefit of company. This also requires a change in some accounting college level courses.   In Future of Accounting System, Zin Lin says “It is clear that many of the disadvantages of IFRS are just short term, for example the costs of transition; while the advantages are long term.” For me, sooner or later, the change needs to be considered to fit with International trading.

Accounting careers are being affected deeply by globalization. Accounting in the future will require not only specific knowledge but also must change with the globalization. Accountants will need to be well prepared in computer skills, the ability to learn new softwares and new accounting rules. All accountants must be prepared to work in an international, world-wide environment.