Accounting: Shearing the flock vs finding the one lost

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Today I came across this study concluding that accountants don’t have the technical chops needed for data-driven business analysis.

This is hard to believe. Accountants and CPAs have a relatively rigorous training, and their job is inherently quantitative. 

No, what I think is happening isn’t a skills gap as much as a culture gap. It’s the “to-the-penny” accounting mindset versus the “within-the-confidence-interval” statistics framework.

Accounting vs. statistics

Analysts spend the majority of their time preparing data, known as “data wrangling.”

Often this involves reconciliations of relatively minor amounts of data — off by a couple thousand dollars or a few units. 

Loads of time and energy go into reconciling. I joke that often you can’t shear your hundred sheep because you’re off looking for the one lost sheep. By this, you aren’t actually learning anything from your data because you are too busy preparing and reconciling it.

Data wrangling is hard — and frustrating. But in an accounting-driven mindset, it’s imperative that numbers totally match, that all minutiae are accounted for (pun intended). You’ve got to report the numbers to the board, to your manager. Everyone must be on the same page. Balance sheets must balance.

But let’s say you’re just trying to analyze your data for insights. You just want to frame a specific business problem, not document your financial reality in all its complexities.

You’re looking within a confidence interval — “exact” answers aren’t expected. It’s a different mindset. In this example, shearing your hundred sheep is more valuable than finding the one lost.

Skills shortage, or culture gap?

This study likely overstates a skills shortage of accountants using analytics. The problem is really that preparing financial statements and performing data analytics are two quite different routines requiring differing levels of data integrity — and different goals.

Accountants/finance professionals — what do you think? Do you see a culture gap between accounting and statistics in your job? Are you or coworkers struggling with the analytics skills needed today?

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