Rethinking Financial Reporting: the Model-driven Financial Statement
Universal Technology of Accountability
Continuous Accounting (Blackline)
Continuous Accounting 2.0 (Blackline)
The Data Centric Revolution: Data Centric Accounting (Semantic Arts)
Continuous Financial Close (SAP)
Continuous Accounting (NetSuite)
What is Continuous Accounting? (Corporate Finance Institute)
Continuous Accounting (Modern Treasury)
mindmap
id0{{"**Modern Accountancy:**
Real space and cyberspace (i.e. the internet) do not operate in the same manner. Because the territory has changed, a new 'map' of the world is necessary. Using old maps to understand the future will not work effectively. Imagine it. Freedom from drudgery. Freedom from the toil of tedious, repetitive, mundane, monotonous tasks."}}
id1["**Current Paradigm:**
Inability to automate many processes. The volume of information is increasing, the complexity of information is increaing, and the pace at which information flows is increasing. The same thing that is causing the problem, technology, can help solve the problem. "]
id1a["**Tedious:**
A lot of accounting work is tedious, mundane, monotonous; rekeying or 'copy/paste'. These processes can be error prone. It is very difficult to impossible to effectively automate tasks and maintain high-quality accountants are known for."]
id1a1["**Fewer accountants:**
Because accounting work is so tedious and monotonous; fewer people are getting degrees in accounting and therefore fewer accountants and auditors are available."]
id1a2["**Human-Machine Teaming:**
Humans and machines will work together similar to how an accountant uses a calculator to do math. Humans will be in control."]
id1b["**Traditional electronic spreadsheets:**
Current electronic spreadsheets are not knowledge graphs. Electronic spreadsheets are too flexible, ERP systems are too rigid."]
id2["**Digital First Paradigm:**
The 'digital' paradigm will not work like the current paradigm."]
id2a["**Structured Information:**
Information in a structured format which is effectively interpretable by computer-based processes."]
id2b["**Artificial Intelligence:**
Using the right AI approach for the necessary task. Using the wrong tool for the job will not be effective."]
id2b1["**Rule-based intelligence:**
Guaranteed reliability because it is based on deductive reasoning."]
id2b2["**Probability-based intelligence:**
Very useful for certain tasks; but not 'guaranteed reliability'. Therefore, a human must always be in the loop for certain tasks and processes."]
id2b2a["LLMs will be used where appropriate. LLMs are very useful tools when used approprately. But they are not the only tool modern accountants should rely on."]
id2c["**Immutable Digital Distributed Ledgers:**
Basically public databases that can never be changed."]
id2d["**Standards:** provide leverage. Standard identifiers like IRIs, standard character sets like UNICODE, standard data types."]
id2da["**Standards:**
The Semantic Web Stack (RDF, OWL, SHACL, SPARQL) and Labeled Property Graphs (LPGs) are new, standards-based tools for solving information problems."]
id2da1["**DATALOG:**Standards such as DATALOG which is a powerful yet safe (i.e. no catestrophic system failures do to logical paradoxes such as infinite loops means powerful rule-based artificial intelligence is possible."]
id2da1["**High-Level Models:**
Because technology is complex, high-level models can be used to make the technology approachable by average business professionals. High-level models can reduce complexity."]
id2da2["**IRI:**
An IRI is a standard identifier which works globally."]
id2da3["**Standard Semantics:**
Global standard semantics (a.k.a. meaning) enables effective information exchange."]
id2da4["**Knowledge Graphs:**
Financial reports are knowledge graphs. A set of accounting and/or audit working papers is likewise a knowledge graph."]
id3["**Effective:**
To be effective, the following are necessary."]
id3a["**Structured information:**
Because information is structured; the information is machine-interpretable."]
id3a1["**Machine-interpretable:**
Because information is machine-interpretable; artificial intelligence software can read information."]
id3a1a["**Complete:**
A complete set of rules is provided which is necessary to keep software going down the right path."]
id3a1a1["**Control:**
Because information is machine interpretable and because a complete set of rules is provided; effective automateion is possible."]
id3a1a1a["**Effective Automation:**
Because effective automation is possible; processes which have here-to-for had to be performed by humans can now be performed by computer based processes in many cases."]
id3a1a1a1["**Collaborative Work Management:**
Because effective automation is possible; work management systems (project management systems) can be effectively built."]
id3a1a1a2["**Collaborative Work System:**
Because effective automation is possible; actual WORK can be effectively automated in many cases. For example, accounting and audit working papers can be created in entirely new ways."]
id3a1a1b["Lean Six Sigma techniques like Poka Yoke enable provably effective and repeatable control. Agile philosophies and techniques like 'test driven' creation."]
id3a1a1c["Control is the elimination of unwanted 'wild behavior'. Spreadsheets cannot do this."]
id3a1a1c1["Effective control provides justifiable trust. If a process is not reliable and repeatable, it is not worthy of trust."]
id3a1a1d["Effective automation eliminates the need for 'remediation' or dealing with the ramifiactions of a 'failure'. See the 1-10-100 rule."]
id3a1a1e["Effective automation REQUIRES metadata. The metadata MUST be high quality and curated. Machine interpretable information is the ONLY WAY to get a computer, which is a dumb beast, to perform work."]
id4["This universal technology of accountability is grounded, even ingrained, in medieval traditions. Yet this universal technology of accountability is going to be impacted by structured information, artificial intelligence, digital distributed ledgers, and other such technologies. And they should be. Those same technologies that are causing the ever increasing volume and complexity of information that is overwhelming us is also the solution to the information overload that is being experienced. Accountancy will be modernized. This is inevitable."]
id4a["What if accountants had a new type of tool; a professional spreadsheet? Traditional electronic spreadsheets are too flexible. ERP systems are too inflexible. What if something was created in the middle of those two extremes?"]
id4b["The 'audit bundle' transitioned from being literally a bundle of papers to becoming a bundle of electronic paper documents. What if a modern 'audit bundle' was more like a database? A queriable knowledge graph? A pivot table?"]
id4c["Reliability, high quality, trustworthiness, and understandability are of paramont importance."]