The future of accounting
Refining accounting for tomorrow
Now is the time to create an accounting that is better suited to today’s realities
Accounting is a technical, social, and moral practice concerned with sustainable resource use and proper accountability to stakeholders, not just shareholders, to enable the flourishing of organisations, people, and nature.
Carnegie, Parker and Tsahuridu (2021)
A message from Professor Garry Carnegie
The means of accounting by which we teach are hyper-developed, while the ends seem to be under-articulated and hazy.
The rhetoric of accounting’s ethics and essential public interest obligations are increasingly ringing hollow, ignoring a reckoning with its real-world organisational, social and environmental impacts.
Fundamentally, accounting must re-examine its reason for existing: its purpose needs to be remodelled to shape a better world in the public interest.
For students who are tomorrow’s leaders, now is the time to create an accounting that is better suited to today’s major challenging issues.
Accounting needs to synthesise and prize ethical rigour, social responsibility, and moral purpose alongside technical mastery.
Don’t ask what accounting can do for you. Ask what you can do for accounting in shaping a better world.
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Accounting for shaping a better world
Accounting is a multidimensional practice. Carnegie, Parker and Tsahuridu (2021a, p. 69; 2021b) proposed the following definition: “Accounting is a technical, social and moral practice concerned with the sustainable utilisation of resources and proper accountability to stakeholders to enable the flourishing of organisations, people and nature”.
“Accounting is not a mere neutral, benign, technical practice” (2021a, p. 73). It needs to synthesise and prize ethical rigour, social responsibility and moral purpose alongside technical mastery.
Presently, accounting and accountants seem to be stuck in a narrow, technicist mindset. As a combined technical, social and moral practice, the following key questions are posed for the effective operationalisation of this definition in practice (Carnegie et al., 2023):
- Technical practice: How do we do accounting? What conventions drive what accounting fails to do?
- Social practice: What does accounting do? What are the impacts of accounting in the world?
- Moral practice: What should accounting do? What should accounting not do?
This definition of accounting and the framework of key questions portrayed presents an impetus to accounting’s future leadership in shaping a better world. This necessitates shaping a fairer and more sustainable world, adopting and instigating UN SDGs-related solutions to the challenging issues facing the world.
Carnegie, Gomes, Parker, McBride and Tsahuridu (2024) emphasise the importance of accounting to extend, and move positively towards, emphasising and integrating the 1) technical, 2) social and 3) moral practice dimensions in accord with the discipline’s essence. These dimensions constitute and portray the essential public interest obligations to be consciously met in everyday professional accounting practice. For a diagrammatic representation, see Figure 3 “Public interest framework for multidimensional accounting” (2024, p. 1543).
Carnegie et al. (2024, p. 1552) conclude “This journey has already started! Get a ‘ticket to ride’!” This ride is for those who desire for accounting to reach its full potential and who want to contribute to the process of actively realising its potential. This occurs when accounting, serving the public interest as its mission, aspires in thought, practice, regulation and innovation, to stimulate the betterment of humans and non-humans alike. This is a fair and equitable world, one that steadfastly prizes the conservation and preservation of the natural environment and the protection and longevity of planet Earth.
Garry Carnegie
Emeritus Professor of RMIT University
22 October 2024
Resources
Carnegie, G., Parker, L.D. and Tsahuridu, E. (2021), “Redefining Accounting for Tomorrow”, IFAC website, 6 April 2021.
Carnegie, G., Parker, L.D. and Tsahuridu, E. (2022), “SOS Accounting Educators: Developing Accounting and Accountants for a Better Future”. IFAC website, 19 April 2022.
Carnegie, G. and Rose, J. (2023) “How Should we Redefine Accounting?”. ICAEW Insights, 14 April 2023.
Carnegie, G., Parker, L.D., and Rose, J. (2023) “Redefining Accounting for Shaping a Better World and a More Attractive Profession”, ICAS News, 16 November 2023.
Carnegie, G. and Rose, J. (2024) “Embrace Broader Definitions of Accounting to Help your Students Operate Sustainably”, Times Higher Education, 8 March 2024.
Carnegie, G.D., Gomes, D., McBride, K., Parker, L.D. and Tsahuridu, E. (2024), “How accounting can shape a better world: framework, analysis and research agenda”, Meditari Accountancy Research, Vol. 32 No. 5, pp. 1529-1555.
