Blockchain Technology

  • جو شخص بہانہ بنانے میں بہت اچھا ہو ، وہ کسی اور کام میں اچھا نہیں ہو سکتا
  • پیسہ بدترین آقا ہے، مگر بہترین غلام بھی ہے
  • کسی فرد یا قوم کو برباد کرنا ہے تو اس کی امید کو مار ڈالیے اور اگر اسے تعمیر کرنا ہے اس کی امید کا دیا روشن کیجئے
  • کامیابی سوچ سے ملتی ہے
  • زندگی کی دوڑ میں دوسروں سے آگے نکلنے کیلئے تیز چلنا ضروری نہیں، بلکہ ہر رکاوٹ کے باوجود چلتے رہنا اور مسلسل چلتے رہنا ضروری ہے
  • جب باتیں آمنے سامنے ہوتی ہیں تو جھوٹ اور غلط فہممی کا خاتمہ ہو جاتا ھے
  • بہت اونچے پہاڑ پر چڑھنے کے لئیے قدم آہستہ آہستہ اٹھانا پڑتے ہیں
  • تین چیزیں نیکی کی بنیاد ہیں، تواضع بے توقع, سخاوت بے منت اور خدمت بے طلبِ مکافات
  • غربت اور افلاس کی وجہ پیداوار کی کمی نہیں، بلکہ اسکی غلط تقسیم ہے
  • دولت ہونے سے آدمی اپنے آپ کو بھول جاتا ہے اور دولت نہ ہونے سے لوگ اس کو بھول جاتے ہیں
  • مصروف زندگی نماز کو مشکل بنا دیتی ہے , لیکن نماز مصروف زندگی کو بھی آسان بنا دیتی ہے
  • گناہ کو پھیلانے کا ذریعہ بھی مت بنو, کیونکہ ہوسکتا ہے آپ تو توبہ کرلو, لیکن جس کو آپ نے گناہ پر لگایا ہے وہ آپ کی آخرت کی تباہی کا سبب بن جائے
  • اپنی زندگی میں ہر کسی کو اہمیت دو, جو اچھا ہوگا وہ خوشی دے گا اور جو برا ہوگا وہ سبق دے گا
  • درخت جتنا اونچا ہو گا اس کا سایہ اتنا ہی چھوٹا ہو گا, اس لیے اونچا بننے کی بجائے بڑا بننے کی کوشش کرو
  • جو شخص کوشش اور عمل میں کوتاہی کرتا ہے, پیچھے رہنا اس کا مقدر ہے
  • جو لوگ میانہ روی اختیار کرتے ہیں, کسی کے محتاج نہیں ہوتے
  • حقیقی بڑا تو وہ ہے جو اپنے ہر چھوٹے کو پہچانتا ہوں اور اس کی ضروریات کا خیال رکھتا ہو

Jul 5, 2016
313
5
18
Karachi
#2
Blockchain promises to be a disruptive technology for the accountancy and auditing professions. Here the Institute of Chartered Accountants in England and Wales’s (ICAEW) IT faculty collates useful information and resources on the distributed ledger technology and its applications.

What is blockchain
Some call blockchain a foundational technology with the ability to transform how many tasks are done, and predict that its adoption will spend the end of the audit profession, or even the whole of accounting. But beneath the hype, there is a complex and developing technology that has a long way to go before its true use cases and effects are identified.

Blockchain has the potential to disrupt the work of accountants – particularly those focused on transactional tasks. It has the potential to increase the efficiency of the process of accounting for transactions and assets, operating as a system of universal entry bookkeeping. Undoubtedly, blockchain has to solve some technological and legal challenges before it can be fully bedded into the financial record-keeping systems of the world. However, the accountancy profession with its unique technical and business knowledge is well-positioned to help blockchain with these struggles.

Opportunities and challenges
Blockchain is a foundational change in how records are kept and updated. Rather than having one single owner, blockchain records are spread out among all their users. The genius of the blockchain approach is in using a complex system of consensus and verification to ensure that, even with no central owner and with time lags between all the users, there nevertheless remains a single, agreed-upon version of the truth.

Key features of blockchain
Blockchain is unusual for a hyped tech trend in that it is a back-office solution to how to transfer ownership of assets and record data online – in other words, it is a platform for accounting and business to be done on, rather than a novel application or business model. The technical details of how blockchain works and what makes it proof against attack and theft are outside of the scope of this paper; however, a brief overview is provided in the appendix of the report.

We split the most important facets of blockchain technology into the "three Ps" – three key terms that explain what makes blockchain different from the more familiar ledgers of today, which are databases owned and run by a single party.

FEATURE: Propagation
BLOCKCHAIN LEDGER: New transactions originate with one user but propagate to a network of identical ledgers, without a central controller.

FEATURE: Permanance
BLOCKCHAIN LEDGER: All transactions and records are permanent, unable to be tampered with or removed.

FEATURE: Programmability
BLOCKCHAIN LEDGER: Many blockchains are programmable, allowing for automation of new transactions and controls via "smart contracts."

Source: ICAP - The Pakistan Accountant
 
Jul 5, 2016
313
5
18
Karachi
#3
Blockchain and the future of accountancy

Details on the potential of blockchain, its implications for auditors, how the accountancy profession can lead and what skills are necessary for the future.

The potential of blockchain
Blockchain is an accounting technology. It is concerned with the transfer of ownership of assets, and maintaining a ledger of accurate financial information. The accounting profession is broadly concerned with the measurement and communication of financial information, and the analysis of said information. Much of the profession is concerned with ascertaining or measuring rights and obligations over property, or planning how to best allocate financial resources. For accountants, using blockchain provides clarity over ownership of assets and existence of obligations, and could dramatically improve efficiency.

Blockchain has the potential to enhance the accounting profession by reducing the costs of maintaining and reconciling ledgers, and providing absolute certainty over the ownership and history of assets. Blockchain could help accountants gain clarity over the available resources and obligations of their organisations, and also free up resources to concentrate on planning and valuation, rather than recordkeeping.

Alongside other automation trends such as machine learning, blockchain will lead to more and more transactional-level accounting being done – but not by accountants. Instead, successful accountants will be those that work on assessing the real economic interpretation of blockchain records, marrying the record to economic reality and valuation. For example, blockchain might make the existence of a debtor certain, but its recoverable value and economic worth are still debatable. And an asset’s ownership might be verifiable by blockchain records, but its condition, location and true worth will still need to be assured.

By eliminating reconciliations and providing certainty over transaction history, blockchain could also allow for increases in the scope of accounting, bringing more areas into consideration that are presently deemed too difficult or unreliable to measure, such as the value of the data that a company holds.

Blockchain is a replacement for bookkeeping and reconciliation work. This could threaten the work of accountants in those areas, while adding strength to those focused on providing value elsewhere. For example, in due diligence in mergers and acquisitions, distributed consensus over key figures allows more time to be spent on judgemental areas and advice, and an overall faster process.

Implications of blockchain for auditors
Blockchain has applications in external audit. Performing confirmations of a company’s financial status would be less necessary if some or all of the transactions that underlie that status are visible on blockchains. This proposal would mean a profound change in the way that audits work.

A blockchain solution, when combined with appropriate data analytics, could help with the transactional level assertions involved in an audit, and the auditor’s skills would be better spent considering higher-level questions.

For example, auditing is not just checking the detail of whom a transaction was between and the monetary amount, but also how it is recorded and classified. If a transaction credits cash, is this outflow due to cost of sales or expenses, or is it paying a creditor, or creating an asset?

These judgemental elements often require context that is not available to the general public, but instead require knowledge of the business, and with blockchain in place, the auditor will have more time to focus on these questions.

How the profession can lead with blockchain
The move to a financial system with a significant blockchain element offers many opportunities for the accountancy profession. Accountants are seen as experts in record keeping, application of complex rules, business logic and standards setting. They have the opportunity to guide and influence how blockchain is embedded and used in the future, and to develop blockchain-led solutions and services.

To become truly an integral part of the financial system, blockchain must be developed, standardised and optimised. This process is likely to take many years – it has already been nine years since bitcoin began operating and there is much work still to be done. There are many blockchain applications and start-ups in this field, but there are very few that are beyond the proof of concept or pilot study stage. Accountants are already participating in the research, but there is more for the profession to do. Crafting regulation and standards to cover blockchain will be no small challenge, and leading accountancy firms and bodies can bring their expertise to that work.

Accountants can also work as advisers to companies considering joining blockchains themselves, providing advice on weighing the costs and advantages of the new system. Accountants’ mix of business and financial nous will position them as key advisers to companies approaching these new technologies looking for opportunity.

Skills for the future
The parts of accounting concerned with transactional assurance and carrying out transfer of property rights will be transformed by blockchain and smart contract approaches.

The reduction in the need for reconciliation and dispute management, combined with the increased certainty around rights and obligations, will allow greater focus on how to accoun for and consider the transactions, and enable an expansion in what areas can be accounted for. Many current-day accounting department processes can be optimised through blockchain and other modern technologies, such as data analytics or machine learning; this will increase the efficiency and value of the accounting function.

As a result of the above, the spectrum of skills represented in accounting will change. Some work such as reconciliations and provenance assurance will be reduced or eliminated, while other areas such as technology, advisory, and other value-adding activities will expand. To properly audit a company with significant blockchain-based transactions, the focus of the auditor will shift. There is little need to confirm the accuracy or existence of blockchain transactions with external sources, but there is still plenty of attention to pay to how those transactions are recorded and recognised in the financial statements, and how judgemental elements such as valuations are decided. In the long term, more and more records could move onto blockchains, and auditors and regulators with access would be able to check transactions in real time and with certainty over the provenance of those transactions.

Accountants will not need to be engineers with detailed knowledge of how blockchain works. But they will need to know how to advise on blockchain adoption and consider the impact of blockchain on their businesses and clients. They also need to be able to act as the bridge, having informed conversations with both technologists and business stakeholders. Accountants’ skills will need to expand to include an understanding of the principle features and functions of blockchain – for example, blockchain already appears on the syllabus for ICAEW’s ACA qualification.

Source: ICAP - The Pakistan Accountant
 

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