The Effects of AI on Accounting
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The Effects of AI on Accounting
Artificial Intelligence, otherwise known as AI, is not something that exists only in science fiction or Hollywood movies. It’s here. And it’s changing the way accountants are doing business. Here’s how and why.
AI Can Help with Tedious Tasks
While combing through spreadsheets is by no means an unimportant task, it can be time consuming, which is why utilizing machine-learning can help with things like this. AI can be used to analyze large volumes of data at speeds beyond what is humanly possible. This way, you can spend more time doing the things that only people can do: engaging with clients on a personal level, as well as working on decision-oriented computations. In fact, according to Shamus Rae, a partner at KPMG, AI will improve the quality of audits. Why? Rae claims that with AI, “it begins to allow us to ask a lot more questions. It will improve efficiency in what we do and will provide more insight.”
AI Utilizes Natural Language Processing Capabilities
Let’s say you’re working on a dense contract or dataset. AI technology can extract key terms, then compile and analyze that information in a shorter period of time. With these kinds of AI tools, companies can differentiate themselves in the marketplace and gain a competitive advantage. For instance, at Crowe Horwath, a Chicago-based accounting firm, scientists used machine-learning to sift through a tangle of billing systems for a healthcare client to flag accounts where there were time-consuming and costly complexities in claim processing and reimbursement. The result? They were able to pinpoint these cases in record time, which saved the customer hundreds of billable hours. Overall, it increased productivity and the folks at Crowe Horwath came out looking like heroes.
AI May or May Not Affect Jobs
Let’s be honest: machines can compute faster than people, so it stands to reason that some jobs will be eliminated. According to Dwayne Bragonier, a chartered professional accountant and founder of BAI Bragonier & Associates Inc., "A big chunk of the manpower required to record a transaction or to accumulate transactions into an aggregate will, of course, be automated.” However, that’s not the whole picture. Bragonier claims that the implementation of AI ignores all the opportunities that technology presents. “The work that will be automated is not a CPA's responsibility. That work was simply something that needed to be done for CPAs to start their job," Bragonier said. This begs the question: what is a CPA’s job? Bragonier said the key tasks center on providing and interpreting "dashboards" or reports that offer value. In his opinion, the critical job is interpreting the meaning and value of the details that the data provides.
Alanna Klassen Jamjoum, director of digital transformation at global management consulting firm A.T. Kearney, expounds upon what we might infer from Bragonier’s opinion that, in the end, humans will not become obsolete.
"In a future where we are increasingly surrounded by AI, we will crave human interaction even more," Klassen Jamjoum said. "And many jobs will be augmented by AI, meaning people can achieve things they never thought possible. Technology should empower, not take away."
These articles are intended to provide general resources for the tax and accounting needs of small businesses and individuals. Service2Client LLC is the author, but is not engaged in rendering specific legal, accounting, financial or professional advice. Service2Client LLC makes no representation that the recommendations of Service2Client LLC will achieve any result. The NSAD has not reviewed any of the Service2Client LLC content. Readers are encouraged to contact their CPA regarding the topics in these articles.