As part of our Shaping the Profession strategic initiative, we are seeking to explore the impact of technological developments, including AI, on professional judgement. The ability to exercise professional judgement is widely described as being central to the role of professional accountant, not only as it relates to auditing and assurance but in every aspect of accountancy.

For example, this is reflected in the International Education Standards for Accountants 2019 Handbook of International Education Pronouncements, which see this as a key competence for professional accountants and define this concept as:

“The application of relevant training, knowledge, and experience, within the context provided by auditing, accounting, and ethical standards, in making informed decisions about the courses of action that are appropriate in the circumstances of the audit engagement.”

Beyond audit and assurance, professional judgement is required of the professional accountant across a wide range of matters including ethics, financial and wider corporate reporting, and business decision-making in general. It therefore plays a key part in the day-to-day professional activities undertaken by a professional accountant, regardless of their role and the sector in which they operate.

Since the establishment of the accountancy profession in 1854, professional accountants have sought to utilise technological advancements with developments such as the calculator, mainframe computers, portable computers, electronic spreadsheets, and the internet amongst others, all playing a significant part in shaping the functioning of the accountancy profession and indeed, wider business and society. They have also had a significant impact on how professional accountants have performed certain activities, and on their respective roles. Although professional judgement has changed in many ways what has arguably not evolved is how we understand, control and assess professional judgment in light of those advances, and how we educate accountants to apply professional judgement.

Recently, the arrival of further technological advancements such as:

• generative artificial applications (Gen AI) and other forms of AI
• robotic process automation (RPA)
• blockchain, and
• data analytics, as technology is allowing the use of much more extensive forms and volumes of data

have allowed for greater digitalisation of approach across business and wider society, as well as enhancing the accountant’s ability to interrogate and interpret data to help better inform decision-making. It is anticipated that such advancements will continue at pace in the years to come, however, it is not yet clear what the impact on professional judgement will be. This is a matter of major importance to ICAS and the wider accountancy profession as well as other professions.

Questions have already begun to be raised as to whether this presents a threat to professions i.e. can AI or other technology tools exercise professional judgement? On the other hand, can developments in AI present professionals with the ability to enhance their judgements? This is currently evident in the medical profession for example where AI has the ability to interrogate scans of patients more accurately than humans, and indeed for professional accountants with the ability to interrogate entire populations of transactions. Further, technology is enabling decision-making at much greater speed and volume efficiency (we can apply professional judgement much quicker and therefore arguably to far more decisions than previously).

If you are interested in undertaking a project in this area, please email research@icas.com attaching a call for research application form (available at icas.com) and a proposal together with summary CVs no later than 23:59 (GMT) on 24 November 2024.

Your application should:

• explain why you believe you or your team are suitable individuals to undertake the project;
• demonstrate your level of, or access to, knowledge and expertise in this area and how this will be leveraged in your proposed methodology;
• state how any team will be structured and responsibilities for completion of the report.

The proposal should identify the specific topics which you will focus on and include:

• details of the proposed research questions and methodology;
• a brief review of prior research/literature (academic and other), if any;
• how the project will advance current knowledge on the topic;
• the extent to which the research will be breaking new ground or building upon work which has already been undertaken;
• a summary of the key issues which you believe are likely to arise from the project;
• the anticipated impact and influence of the project; and
• the amount of grant, in sterling, which you require to complete the project imperatively with a breakdown of the estimated costs.

The Guidance Notes for Research Applicants (available at icas.com) explain what should be included in the proposal.

The research proposals will be considered by a panel of academics and non-academics. Presentations will be required by shortlisted applicants in order to reach a final decision. The shortlist will be advised by ICAS on 28 November, and applicants should ensure that they are available for such presentations on 11 or 12 December.  The final decision will be communicated shortly thereafter.

For further information about this funding opportunity please contact the ICAS research centre: research@icas.com.