AI is transforming the way we live and work. Virtual assistants on smartphones, self-driving vehicles, and face recognition software all use AI to streamline and enhance our daily interactions, increase efficiency, and revolutionize various industries.
What exactly is AI in accounting?
AI is a software application or a computer program that can simulate or imitate human behavior. AI applications tend to automate a significant portion of repetitive tasks in accounting. AI Technology in accounting is going to have or is already having an impact on the accounting profession.
How are accountants using AI at present?
Accountants currently utilize AI in various applications within their profession, replacing human processing and decision-making.
- · The adoption of AI in accounting is increasing and has transformative effects on business practices. Examples of AI implementation in accounting include EY’s use of AI drones for inventory counts and Deloitte’s use of the “Argus” tool for extracting accounting information from electronic documents.
- · AI is utilized in management accounting for tasks such as coding accounting entries, revenue forecasting, and analyzing unstructured data.
- · Future possibilities for AI in accounting include using intelligent virtual assistants like Alexa or Siri to analyze accounts payable for duplicate payments during audits.
- · Technological advancements in AI could enable accountants to interact with AI applications through intelligent virtual assistants, performing tasks like audit analysis, data retrieval, spreadsheet creation, and data visualization.
How AI is creating jobs in accounting?
AI is revolutionizing the accounting field, creating new job opportunities and transforming existing roles. According to Deloitte, 60% of finance professionals anticipate that AI technologies will enhance their job functions, resulting in higher productivity and efficiency. Additionally, the International Data Corporation predicts a substantial investment of USD 4.5 billion in AI and cognitive systems in the accounting industry. These statistics highlight how AI is not replacing accountants but rather empowering them to concentrate on strategic tasks like data analysis, decision-making, and delivering valuable insights to foster business growth.
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Why do accountants need AI skills?
- · Accounting is increasingly being recognized as a STEM profession, supported by efforts such as the introduction of the Accounting STEM Pursuit Act of 2021. The American Institute of Certified Public Accountants (AICPA), Center for Audit Quality, and National Association of Black Accountants have expressed their support, stating that STEM recognition for accounting will contribute to the diversification and development of a highly skilled and qualified pool of accountants in the United States.
- Accounting solutions are advancing beyond basic transactional processes, incorporating AI and ML capabilities to automate repetitive tasks like invoice processing, data extraction from PDFs, and payment handling. Gartner predicts that by 2025, hyper-automation technologies, including ML and AI, will be responsible for over 50% of work in finance and accounting BPO firms. Hyper automation involves using these technologies to automate complex tasks that traditionally require human judgment, such as financial statement analysis.
- · AI is transforming the field of accounting by automating tasks, detecting errors, and making predictions. By upskilling in AI, accountants can future-proof their careers and differentiate themselves. Accounting applications are increasingly incorporating AI and ML capabilities to automate processes like invoice processing and data extraction. Gartner predicts that technologies enabling hyper-automation, including ML and AI, will handle more than 50% of work in finance and accounting BPO firms by 2025. As accountants embrace AI, they can take on strategic roles as business advisers, compliance experts, and AI automation leaders, leveraging their expertise in data analysis and interpretation.
- · AI’s potential to provide valuable insights is hindered by implementation challenges exacerbated by a shortage of skilled individuals. To address these obstacles, finance leaders are refining their talent strategies in three key ways: recruiting AI specialists externally, equipping existing finance professionals with AI skills, and leveraging AI expertise from IT departments. Gartner reports that 32% of leading AI finance firms are hiring dedicated AI talent externally, whereas only 10% of other finance firms utilizing AI in their operations are doing the same.
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AI is transforming the accounting profession as it automates repetitive tasks, creates new job opportunities, and empowers accountants to focus on strategic analysis and decision-making. Accountants must acquire AI skills to remain competitive in a rapidly evolving field and leverage the valuable insights and efficiencies that AI offers. To fully harness the potential of AI in accounting, organizations should invest in talent acquisition and development to overcome implementation challenges and maximize the benefits of this transformative technology.