(TORONTO) March 15, 2018 – A new white paper from the national professional accounting organizations in Canada and the United States, along with the University of Waterloo, finds blockchain technology could potentially impact the audit and assurance services landscape.
Blockchain Technology and its Potential Impact on the Audit and Assurance Profession from Chartered Professional Accountants of Canada (CPA Canada), the American Institute of CPAs (AICPA) and Waterloo discusses how financial statement auditing might evolve with blockchain technology and also considers new assurance services and future roles for CPAs. The paper was authored by several leaders in blockchain technology from Deloitte’s U.S. audit and consulting businesses, as well as blockchain leaders of Deloitte Canada, CPA Canada, the AICPA and Waterloo.
The white paper concludes that while blockchains are unlikely to replace judgments by a financial statement auditor, “CPA auditors need to monitor developments in blockchain technology because it will impact their clients’ information technology systems ... and work with experts to audit the complex technical risks associated with blockchains. CPA auditors should be aware of opportunities to leverage their clients’ adoption of blockchain technology to improve data gathering during the audit … and should consider whether blockchain technology will allow them to create automated audit routines.”
“Change comes quickly,” says Gord Beal, vice president of research, guidance and support at CPA Canada. “Anticipation, early understanding and integration of innovative technologies is critical to the success of our members and the organizations they serve. Blockchain is already starting to affect CPAs and its impact on the profession is anticipated to grow. We are committed to providing guidance to help CPAs navigate these changes and create opportunities for the future.”
“This white paper sheds light on a key technological development that CPA auditors in North America – and around the world should stay abreast of,” says Susan S. Coffey, CPA, CGMA, Association of International Certified Professional Accountants’ Executive Vice President for Public Practice. “Blockchain is bringing new challenges and opportunities to the audit and assurance profession. As the paper makes clear, CPAs will need to evolve their skillsets and knowledge to meet the anticipated demands of the business world as blockchain and other new technologies are more widely adopted.”
“There is no doubt that blockchain technology, cryptocurrencies and smart contracts have captured the imaginations of people around the world,” says Efrim Boritz, professor, School of Accounting and Finance, University of Waterloo, director, UWCISA. “The University of Waterloo’s Centre for Information Integrity and Information Systems Assurance (UWCISA) is monitoring developments in this area and conducting research to ensure that we understand the strengths and weaknesses of these technologies – to look beyond the hype – to help decision makers make sound choices when considering the opportunities and risks represented by these technologies.”
The white paper contains a call to action that urges CPAs, including those in auditing, to continue to monitor developments in blockchain technology. Additionally, CPA Canada and the AICPA encourage auditing and accounting standard setters to monitor progress and adoption of blockchain technology in the business ecosystem. The CPA profession needs to envision the future skills that will be required to allow CPAs to meet the demands of the market in a business world where blockchain technology is widely accepted.
This white paper continues CPA Canada’s ongoing work in this area which also includes examining blockchain as enabler for climate action and exploring the impact of blockchain technology. For its part, the AICPA last October announced its collaboration with the Wall Street Blockchain Alliance, a leading nonprofit trade association promoting the comprehensive adoption of blockchain technology across global markets. All the organizations are working to define the impact of blockchain technology for the accounting profession and advance the interests of the public and the profession.
About CPA Canada
The new Canadian designation, Chartered Professional Accountant (CPA), is now used by Canada’s accounting profession across the country. The profession’s national body, Chartered Professional Accountants of Canada (CPA Canada), is one of the largest in the world with more than 210,000 members, both at home and abroad. The Canadian CPA was created with the unification of three legacy accounting designations (CA, CGA and CMA). CPAs are valued for their financial and tax expertise, strategic thinking, business insight, management skills and leadership. CPA Canada conducts research into current and emerging business issues and supports the setting of accounting, auditing and assurance standards for business, not-for-profit organizations and government. CPA Canada also issues guidance and thought leadership on a variety of technical matters, publishes professional literature and develops education and professional certification programs. cpacanada.ca
About the American Institute of CPAs
The American Institute of CPAs (AICPA) is the world’s largest member association representing the CPA profession, with more than 418,000 members in 143 countries, and a history of serving the public interest since 1887. AICPA members represent many areas of practice, including business and industry, public practice, government, education and consulting. The AICPA sets ethical standards for its members and U.S. auditing standards for private companies, nonprofit organizations, federal, state and local governments. It develops and grades the Uniform CPA Examination, offers specialized credentials, builds the pipeline of future talent and drives professional competency development to advance the vitality, relevance and quality of the profession.
The AICPA maintains offices in New York, Washington, DC, Durham, NC, and Ewing, NJ.
Media representatives are invited to visit the AICPA Press Center at www.aicpa.org/press.
About the University of Waterloo and the School of Accounting and Finance
University of Waterloo is Canada’s top innovation university. With more than 36,000 students we are home to the world's largest co-operative education system of its kind. Our unmatched entrepreneurial culture, combined with an intensive focus on research, powers one of the top innovation hubs in the world. Find out more at uwaterloo.ca.
The University of Waterloo's School of Accounting and Finance is the largest professional school of its kind in English-speaking Canada. Established in 1981, the School offers specialized undergraduate and graduate programs in accounting and finance designed to provide students with the competencies, professionalism and practical experience they need to excel in their chosen careers. It also offers masters programs in accounting and taxation and a PhD program in accounting. For more details, visit https://uwaterloo.ca/saf.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the “Deloitte” name in the United States and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms.