Why and how accountants should "think about Blockchain"


"Blockchain is an accounting system and we are accountants".

The CPAs and consultants Masotti and Masotti LLC, a nearly 60-year-old CPA company, have recently registered as a brand of newly launched Blockchain consulting services. He says almost everything about why Blockchain is redefining the accounting and the new opportunities that leads to the profession.

What is Blockchain?

Blockchain is a distributed and secure ledger (database) that uses cryptography on a peer-to-peer network technology to group transactions in BLOCKS and store them in a tamper-proof interconnected CHAIN.

For accountants, the two important keywords in the above description are "ledger" and "technology". Accountants have master books deeply understood for centuries. They have been taking advantage of the technology for decades. Therefore, Blockchain, is not a challenge or a threat to the profession, but it is a phenomenal new opportunity that accountants must prepare for the fact that the purely transformative – and therefore disruptive – impact of this technology is far too important to ignore for any accountant .

Blockchain and accounting profession:

The key things to keep in mind regarding the blockchain are:

  • Blockchain allows you to exchange transaction data securely without going through a third central part
  • Unless there is (enough) verification and consent by the participating entities, no transaction enters Blockchain
  • It is enormously expensive and difficult to tamper with the data on Blockchain

It means that the time, effort and cost of creating books for each company and reconciling them can be drastically reduced to a minimum. At the same time, the need to check the data of commercial transactions can be almost obvious. These two fundamental impacts of Blockchain are of extreme importance for the "work" that accounting and accounting firms will do in the future. The Blockchain will therefore require a "de-qualification" and a "redevelopment" of the traditional accounting, the CFO and the roles of the auditors.

Accountants must evaluate the impact of Blockchain on its internal processes and, more importantly, on how their clients and prospects are adapting / adapting to Blockchain's opportunities in their industries / professions.

Blockchain to activate changes to the immediate horizon

  • Cryptocurrency + Smart contracts: Four large companies are leading the way in the run for the adoption of Blockchain. Accepting Bitcoin as a payment method was just the beginning that kicked off the Big Four. Blockchain's consultancy and auditing services are already a reality, although so far it is not a professional experience. Smart contracts are already demonstrating their ability to minimize "managing payments and reconciliation" work.
  • IoT + Blockchain: Internet of Things (IoT) is revolutionizing production, supply chain and other sectors. The IoT combined with Blockchain is leading to what is called the "Internet of Trusted Things" (IoTT). The difference is subtle but immense. It is because IoT is not yet a network interconnected within or between sectors and therefore expensive to establish the identity (trust) between the "in transit" parts and the exchange of data (interactions) in trusted ways. IoTT reduces these expensive requirements of "trust, transaction, interactions" from the company. Imagine the speed with which accounting data will be available for accountants.
  • Cybersecurity: Although Blockchain technology itself potentially increases cyber defense capabilities, it does not address the proven weaknesses in "access" to any technology / network exploited by cyber criminals. The IT security services and accesses to the Blockchain system – including the control of which "value" has been tokenized to represent it on Blockchain are two new promising emerging income segments for the accounting profession.
[ad_2]Source link