In 2020, the FBI reported a nearly 70 percent increase in cybercrime complaints with more than $4.1 billion in losses. IC3 (the U.S. government’s Internet Crime Complaint Center) received a record number of complaints from the American public in 2020, almost 792,000. This represents a 69% increase in total complaints from 2019. As agencies tackle this new threat, they have a new line of defense: cyber accountants. Working alongside cybersecurity and IT experts, cyber accountants have the technological and financial training to assess costs, system vulnerabilities, and risks of cyber-attacks. From an economic perspective, “Cyber accounting is the new force of accounting in (the) Digital Economy.” If you’re an accountant or thinking about going into accounting, here’s what you need to know.
Accountants Are on the Front Lines of Cybercrime
Financial public accountants have a huge volume of financial data and private documents that belong to their clients, which is why cyber criminals are highly attracted to accounting firms and accounting departments in organizations and businesses.
Cyber criminals also like to focus on retailers due to the extensive amount of credit card information retailers possess. For example, a 2013 data breach of the retailer Target exposed the credit card information of 40 million customers (about twice the population of New York state). As a result, Target had to pay an $18.5 million settlement and reported a total cost of $202 million.
Another form of identity theft is account takeovers. This is when someone steals and uses personal identifying information, like a name or Social Security number, to commit fraud or other crimes. In 2020, account takeovers were 62 percent higher for online retailers than any other industry in 2020. Maryland ranked 10th among 55 U.S. jurisdictions with close to 15,000 victims of cybercrime. Accountants are responsible for implementing the necessary internal controls to mitigate the risks of data vulnerability and to be prepared for the threat of cybercrime.
CyberAccounting Is Accounting for the 21st Century
Management and in-house accountants are often the first to become aware of data breaches and can be part of the first line of defense against cyber-attacks. It’s all a matter of understanding the threat and being trained in cyberaccounting.
Professionals in the cybersecurity field have the expertise to identify cybersecurity risks and mitigate those risks. But they often don’t have expertise in accounting processes, which differ depending on the type and size of the business. Accountants can implement controls, detect suspicious activity associated with data breaches, and contact cybersecurity professionals.
Cyber accountants bridge the divide.
Cyber accountants work jointly with cybersecurity experts to identify system vulnerabilities, develop and implement strategic plans to protect assets, and evaluate the need to implement new internal controls to close data security gaps. If a security breach occurs, cyber accountants have the skills to work alongside cybersecurity professionals throughout the response and recovery process.
Embracing this systems approach, organizations are working toward mitigating many of the cybersecurity risks they face by hiring accounting employees or contracted staff who fully understand cybersecurity as a new field in accounting.
You Will Soon Need Technological Knowledge to Pass the CPA (Certified Public Accountant) Exam
It only takes one person to initiate a major ransomware attack or other forms of cybercrime. Cyber-attacks on businesses, governments, and nonprofit organizations are an increasing threat to the national economy. When interviewed by 60 Minutes, Jerome Powell, chairman of the U.S. Federal Reserve, stated “I would say that the risk that we keep our eyes on the most now is cyber-risk.” In response, the American Institute of CPAs (AICPA) will release a newly structured CPA exam, known as CPA Evolution, for the January 2024 exam. For the first time in the history of the CPA Exam, technology will be one of four core topics, and information systems and controls will comprise one of three discipline topics. By adding cyberaccounting to your education now, you will be well equipped to help mitigate cyber risks to financial data and save your organization from costly losses.
UMGC (University of Maryland Global Campus) Can Help You Succeed in CyberAccounting Through a Master’s Degree
UMGC is helping those in accounting gain knowledge and skills to help protect organizations from financial ruin caused by cyberattack. UMGC has developed a Master of Science degree in CyberAccounting to help meet the need for cyberaccounting professionals. Coursework includes cyberaccounting management and compliance, cyberaccounting risk management, and cyber forensics in accounting. With these skills, you can be exceptionally valuable to employers and build a successful career in cyberaccounting.
Reference on this webpage to any third-party entity or product does not constitute or imply endorsement by UMGC nor does it constitute or imply endorsement of UMGC by the third party.