Role of AI in Accounting

• Todd Chapman
• December 02, 2022

Artificial intelligence dramatically impacts accounting and finance just like any other business. Such computer science has become an essential element of advanced bookkeeping software. Accounting procedures that took many hours or days may now be completed in minutes with maximum accuracy. It helps companies retain their employability and attract new generations of employees and customers. Are you interested in reducing costs by 80% and the time required to complete tasks by 80% or even 90%? According to the information posted on the blog of Accenture Consulting, work automation guarantees such results for the financial services industry. If financial companies and accountants want to provide the quality services their clients want and compete successfully with other industry professionals, they need to implement artificial intelligence.

What is the role of AI in accounting?

In today’s world, time-consuming tasks in finance and accounting, including auditing, banking, tax reporting, and payroll, can be successfully automated with the help of AI. Once new learning technologies are integrated into finance, intelligent systems can perform repetitive and time-consuming procedures, leaving analytical and managerial work to humans. From chatbots to interaction with a management accountant, from complying with regulatory requirements and customer wishes to performing time-consuming procedures, the impact of AI has no limits:

• AI positively affects productivity and product quality, creating optimal conditions for audit.
• AI creates a wealth of opportunities and minimizes the time-consuming responsibilities of finance professionals in finding potential for company growth.
• AI helps make financial forecasts. With machine learning (ML), accountants may predict future trends based on historical data.

Robotic process automation (RPA) efficiently performs repetitive work in business, including analyzing records and documents. The addition of RPA frees accountants from repetitive jobs that add no value. Several options to use RPA in accounting:

• AI interacts with documents in real-time using natural language processing and computer vision and generates reports immediately. Such reporting allows the company to determine the direction of movement and act if it is necessary to change course.
• AI automates document processing and authorization to streamline internal accounting, e.g., purchasing, invoicing, shipping orders, expense reporting, payables, and accounts receivable.
• Intelligent technologies audit and check documentation for corporate and government standards compliance. The system will issue a real-time warning if it notices the slightest inconsistency.
• Machine learning tools process a vast volume of information, look for potential illicit manipulations, and mark up such transactions to validate them, so they don’t cut revenue.

Regardless of the size of the business, every firm wants to improve the productivity of accounting and increase its accuracy by minimizing losses. It is all possible through the introduction of artificial intelligence tools. It is important to remember that AI cannot reproduce the creative functions of human thinking, that is, draw meaningful conclusions based on the information it receives. Even if the company fully automates its audit, only an experienced accountant can correctly interpret the data and provide recommendations to develop the organization further.

How to use AI in accounting and finance?

Modern technology-driven business approaches transform accountants from data providers to business improvement experts. Artificial intelligence creates limitless growth opportunities for companies, and CPAs can contribute to AI-ruled projects with their deep knowledge of business operations and data. Bookkeepers who plan to use AI in their work may develop advanced skills to achieve career advancement. Let’s take a look at a few ideas on how to use AI in accounting effectively:

• Dealing with accounts payable and receivable: Processing invoices takes up a lot of time and energy for accountants. AI-enabled management systems enable volume growth, error-free processing, and improved supplier interactions.
• Streamline supplier collaboration: AI technologies help expand customer reach, increase profits, and evaluate suppliers with minimal human intervention.
• Procurement procedure: when organizing procurement and supply, it is necessary to draw up a large package of documents. With AI platforms, accountants can engage in unstructured data processing, automatically reducing the risks associated with violation of legal requirements.
• Audit opportunities: digitization during auditing increases the level of security. With digital trackers, auditors can keep track of all files that have been accessed. Instead of time-consuming searching of paper documents, digital files make it easier for professional auditors.
• Improve monthly, and quarterly cash flows: AI machines get information from different sources and successfully integrate it. AI-based applications speed up all processes and make them more accurate and safer. You may easily collect and consolidate monthly, quarterly, and annual reports using AI tools.
• The implementation of chatbots: virtual assistants allow resolving of user requests effectively. Requests often include data on account balances, statements, credit account status, etc. control of unpaid invoices and automation of collection processes guarantees a balance and quick closing of the account. Advanced chatbots can answer user questions and provide high-level support.

The goal of all business software, including accounting software, is to improve business integration. As digitalization advances, the demand for data centralization increases. Consequently, AI-enabled bookkeeper programs are becoming more and more equipped to ensure full integration and optimization of business processes while simultaneously solving business consulting challenges. When organizations use AI-enabled accounting software, their business model will be more analytical, accurate, and streamlined.

Main benefits of AI in bookkeeping

Data is the core element of AI and accounting. The ability of AI to collect, organize, analyze and interpret numerical data makes it a valuable tool for an accountant. The correct and complete use of AI in the financial industry allows you to develop a holistic money strategy built on effective bookkeeper and economic inclusion:

• Increasing the effectiveness of the role of an accountant: a specialist no longer needs to collect information to audit or analyze organizational income. He may spend time and energy on other essential responsibilities, including strategic development and compliance control.
• Improve accuracy and reduce human errors: AI simplifies accounting by naturally minimizing errors and reducing the time it takes to detect and correct errors. Such features make businesses less susceptible to massive financial inaccuracies, such as missed payments or tax penalties. Such functions make the business less easy to huge financial inaccuracies, e.g., missed fees or tax penalties.
• Improved forecasting capabilities: The long-term development strategy of any business is based on forecasts. Having deeper insights and machine learning tools allows you to make accurate and reliable predictions. Knowing how things will play out in the future is priceless.
• An excellent opportunity to fight fraud: the artificial intelligence checks each financial document to find errors; it can notice violations and send a notification to the accountant. It helps prevent minor inaccuracies from turning into severe problems and draws specialists’ attention to suspicious behavior and transactions.
• Search for hidden ideas: AI technology successfully searches for invisible patterns, ideas, and trends at first glance, giving your company a competitive advantage. All information will be delivered on time and in the best possible way to make quick and informed decisions.

AI and the cloud cooperate to process much information as quickly as possible. Such a service streamlines procedures, saves time, cuts costs, improves productivity, and delivers accurate results. Given all the benefits AI brings to the profession, it will remain in the accounting business for a long time, and its role will evolve. It will provide specialists with additional opportunities to optimize existing processes, create new work methods and increase the company’s value in the eyes of its partners and clients.

Challenges of deploying AI-based tools in accounting

As more companies add AI to their financial operations, they face hurdles. Consultants who help clients add AI to their bookkeeping procedures have identified several common problems. If you are planning to add artificial intelligence systems to the accounting department, analyze these difficulties and decide how best to overcome them:

• The need to provide significant computing power: AI tools and technologies require advanced computing power. It is essential to quickly process a large amount of information to form artificial intelligence systems and add deep learning techniques. Small businesses or startups need help to finance significant computing power.
• Information security: accounting uses a large amount of data; depending on the purpose, this information is present on AI platforms. Some of this data may be sensitive, so there is a risk that important information will be leaked. Due to the lack of a privacy and data usage regulator, many firms are reluctant to add AI.
• Ambiguous results: when processing data between companies or people, conflicts often arise that only the human brain can resolve. The task of creating artificial intelligence that may adapt to such situations and produce results that everyone agrees on remains relevant. Sometimes professionals come across data that leads to unethical and unfair results. Using such systems leads to wrong decisions.

Many people are wondering if AI can replace accountants. Since such tools can perform some of the tasks previously the responsibility of humans, this can affect low-level positions but completely replace artificial intelligence specialists. According to the U.S. Bureau of labor statistics, until 2026, the employment rate of accountants will increase by 10%, which is a high figure. Artificial intelligence can take over tedious and time-consuming procedures such as data entry and verification and eliminate mistakes, reducing liability. Refusing routine work, accountants may engage in consulting activities. They can also focus on strategies – process improvement, cost reduction, and capital structure optimization – while reserving the right to control sensitive data.