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Blockchain could be your solution to spreadsheet fatigue

Block chain 2Over 25 million Americans are still dealing with repairing airbags from one of the largest series of recalls in U.S. history. Car owners are waiting months for repairs – and many are unable to drive their cars while they wait for them to be fixed. Talk about inconvenient, expensive and frustrating.

Now imagine if airbag recalls didn’t have to be such a mess. Blockchain offers an intriguing solution.

Blockchain is a distributed ledger system that can be put to work managing our supply chains. Think of a big spreadsheet or Google doc that you use to record every transaction in a supply chain – from manufacturer to end user. Now imagine that every supplier, manufacturer and seller in the chain has access to that spreadsheet at the same time as you and is updating it with verified information in real time. Except, unlike a Google doc, you can’t retroactively alter information on the blockchain – making it extra secure.

This would mean every single airbag could be tracked from the assembly line to the junk yard. Every car dealer and every user would be recorded. When an error is discovered, the manufacturer could identify the specific airbags with the problem down to the VIN numbers of the vehicles they went into, rather than having to recall entire batches. Using verified information from the blockchain could save money, customer time and manufacturer reputation.

CPAs may someday use blockchain to track a client’s physical assets and follow financial goods throughout an entire lifecycle. Because both the CPA and the client could upload and look at information simultaneously, auditors could get information right away. Think about never having to wait for your client to send you information. You could examine a supply chain in real time, rather than retroactively.

So how can you get involved now? Even if you aren’t already using blockchain in your firm, there are ways to start learning and developing these tools.

  • Keep up to date on regulations surrounding blockchain. Because blockchain is still a relatively new technology, the regulations and standards are still in development. It’s vital to pay attention to federal and state regulations as they’ll affect how we can use blockchain.
  • Start playing around with the technology. Get up to speed on how blockchain works and how different kinds of information can be stored. Understanding how the technology works will give you a huge leg up as it becomes more commonplace. Think about moving operations to the cloud. Many firms still install software on their desktops, which will make moving information to the blockchain unnecessarily difficult.
  • Become a thought leader. CPAs have a huge opportunity to be thought leaders in blockchain’s development. They already are when it comes to other emerging technology like cybersecurity and artificial intelligence. Blockchain should be no different. CPAs are perfectly poised to help shape the environment around blockchain. The more you understand blockchain and how it can benefit your practice, the greater input you can have in shaping the CPA profession.

Remember that blockchain –particularly using blockchain for services like supply chain management – is an emerging space. Take it in baby steps and start experimenting with how blockchain can help your clients. Stay tuned into developments and start thinking about how your firm can best use the technology.

For more information on understanding blockchain, check out this primer and this article

Mark Parzygnat, Program Director - Blockchain, IBM. An IBMer for over 20 years, Mark has worked on both legacy products and emerging technologies within IBM and in conjunction with open source product development. He helped lead the creation of Hyperledger Fabric, a popular open source blockchain technology hosted by the Linux Foundation. He works with multiple companies on the use of this and IBM's enterprise enhancements.

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