Ongoing changes in the accounting industry impact the issues that accountants face. These changes include regulatory changes, innovative technologies, reimagined business models, and increasing client expectations.
Although the evolution of accounting provides new growth opportunities for firms, accountants face increasing challenges in their daily workflows. Because accountants are expected to do more now than ever, they must work through the resulting issues.
Understanding the top accounting issues helps accountants effectively work through and resolve them. The results include strengthening the bottom line and keeping firms competitive.
Discover the top accounting issues in 2023 that you should be aware of to add more value at work.
Regulatory Compliance
The 2022 Private Companies Practice Section (PCPS) CPA Firm Top Issues Survey conducted by the American Institute of Certified Public Accountants (AICPA) found that keeping up with the changes in and complexity of tax laws was among the biggest challenges for the 752 respondents. Also, the 2023 State of the Tax Professionals Report by Thompson Reuters found that 66% of the more than 500 respondents would offer employee training on the changes to tax rules. Accountants must be able to effectively conduct tax research and improve tax reporting efficiencies to help firms stay competitive.
Accounting Standards
The new revenue recognition and lease accounting standards are among the changes in accounting standards in recent years. As a result:
- Accountants must adhere to new auditing standards for presenting the audit report.
- Auditors and managers in charge of governance must change the way they communicate.
- Many public companies are updating their technologies and processes to ensure long-term compliance with the lease accounting standard.
- Accountants must access reliable resources and continuing professional education (CPE) classes to stay current on industry news, developments, and best practices.
Cash Flow Statement Mistakes
Typical cash flow statement mistakes include:
- Misclassifying cash flow as operating or investing
- Missing or improperly including non-cash transactions in the statement of cash flows
- Failure to disclose non-cash transactions
Errors in cash flow statements can lead to misinformed decision-making and poor business results. A company’s financial health is essential amid inflation and the ongoing economic impacts of the coronavirus pandemic. As a result, cash flow statements must be accurate.
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