As more and more companies and accounting firms are looking for solutions to speed up various business processes, accounting automation through artificial intelligence (AI) is inevitable.This is firsthand knowledge to us at Botkeeper, as we’ve helped thousands of accounting firms and businesses achieve accounting automation through AI.
Many firms are searching for the simplest, most cost-effective solutions to help save time doing their bookkeeping and increase total firm capacity. They need help with a lot of their accounting efforts, including managing invoices and transactions without doing damage to their budget.
Does this sound like you?!
We think a lot about automation and what’s possible with artificial intelligence accounting, and while we have our finger on the pulse and are helping form an automation revolution within the accounting industry, we’re not fortune tellers. So we wonder—what can artificial intelligence in accounting achieve over the next several years?
Accounting Automation Through AI: Crunching the Numbers
To understand the future prospects for artificial intelligence in accounting, first we need to evaluate the current impact of artificial intelligence on accounting in general.
Two years ago, the researchers at Sage did a survey in which they asked accountants from different companies to share their insights on artificial intelligence in accounting.
82% of the respondents confirmed that their clients expected more innovative services and resources from their accountants than they did five years ago, meaning that the high demand for AI in accounting has been around for some time, but it was slowed down due to the lack of proper solutions to implement it.
That’s why 66% of respondents answered that they were interested in investing in AI solutions to automate time-consuming tasks, and 55% confirmed they were planning to use AI to improve their business’ functionality.
Among the reasons why companies are now more serious about artificial intelligence accounting is because it gives them a competitive advantage. According to Learn G2:
- 79% of companies believe AI in accounting makes them more competitive because it also makes them more productive.
- Companies become more competitive because they spend less time on processes that would normally take several months. For instance, robotic process automation (RPA) already helps accountants reduce the time they spend on audit and contractual processing from a few months to a few weeks.
- Artificial intelligence in accounting makes companies more competitive because it offers their clients several options for financial advisory services. 68% of clients say they prefer to have both a human financial advisor and an automated bookkeeping solution. (Why wouldn’t you want the creative advisory services a human can offer in addition to the accuracy, speed, and security provided by machines?)
All these accounting automation solutions have already been made possible through AI.
However, there are still many changes ahead of us. What should we expect from artificial intelligence in accounting in the upcoming years?
Let’s take a look.
1. Machine Learning OptimizeS the Risk Assessment AND FP&A ProcessES
Among the many benefits that come with machine learning, perhaps one of the most exciting and helpful benefits relates to risk analysis and financial planning.
Machine learning helps accountants fix errors.
If you use an artificial intelligence accounting solution, it will track every move you make to fix an error in an invoice or a transaction, and based on the data that AI learned from you, it will prevent the same issue from happening again.
Machine learning & AI also aid in financial planning and analysis (FP&A).
Accountants can rely on machine learning to help analyze data and refine forecasting models. Simply put, if the data is poor quality, it's going to lead to an error down the line, but ML and AI can enhance data quality and accuracy without an accountant having to do much work at all. The technology will flag inaccuracies and errors, and it will prevent new errors from occurring based on what it learns, improving and speeding up the FP&A process.
How will the impact of machine learning change in the future?
While machine learning has already automated many accounting procedures, accountants are also looking for the applications of machine learning to help automate the risk assessment process in accounting.
- Experts at the CPA Journal suggest that machine learning and voice recognition, in particular, can be used for executive fraud interviews, which are a part of the standard auditing process.
- Voice recognition could be used to identify indefinite answers that contain words like maybe, probably, sort of, and kind of, as well as delays in responses—all of which may suggest fraud.
- Thus, machine learning can not only be a good tool to automate accounting processes and save time, but it also has the potential to become a tool to detect and prevent fraud and assess risks.
2. Automation Via Continuous IMPROVEMENT RedefineS the Accountant’s Role
Accounting is one of the most essential pieces of running a business, and it’s obviously a key piece of running an accounting firm. That’s why Botkeeper exists—to lighten the burden of tedious accounting on firms and their business clients so they themselves can focus on other things.
Like getting better: providing customers with better service, creating a better environment for employees, innovating to help advance the industry. We’re talking about continuous improvement.
When we say, "continuous improvement," we're talking about a strategic approach to finance and accounting that uses automation for repetitive tasks, calendar optimization for workload distribution, and a focus on improvements across the entire organization.
It’s all fairly basic stuff that accountants might be taught in school, but it’s not uncommon for legacy strategies to trump innovative approaches at firms.
How will continuous IMPROVEMENT and automation through AI shape accounting in the future?
A focus on continuous improvement will surely change the way we perceive accounting processes. Right now, as artificial intelligence in accounting continues to gain momentum, we still see some firms practice traditional approaches to managing invoices, transactions, and other accounting operations.
The more firms embrace and focus on continuous improvement and AI automation, the more the nature of accounting and the role of the accountant will change in the future.
3. Artificial Intelligence EmpowerS Accountants for Success
Now, let’s talk more about the accountant’s role changing due to the pressure coming from developments in artificial intelligence. Note: we’re not saying an accountant’s job is in jeopardy! Just that the associated roles and responsibilities are changing.
It’s a misconception, but some people believe that with more and more accounting operations being automated through AI, companies will no longer need accountants in the future. Botkeeper’s cofounder Louie Balasny touched upon this topic in his speech during the Collision Conference last year.
However, you should see the influence of AI on accounting not as a threat, but rather as an opportunity to combine artificial intelligence with human intelligence to achieve better results.
Here’s how we envision this tandem approach of machines and humans impacting the future of accounting:
- Creating automatic forecasts with a human touch. One of the tasks of an accountant as a financial advisor is to help their clients forecast finances. While AI in accounting will make it possible to automate these forecasts based on already available data, accountants will still have to review for accuracy and provide a professional overview and opinion, which clients are always looking for.
- Doing an audit without fear of human error. The possibility of human error is certainly present in accounting, especially if your company uses traditional approaches to accounting operations. As the impact of AI on accounting is expected to grow in the future, machine learning will help you manage the risks and identify errors in the auditing process to help you create mistake-free reports.
Focusing on other tasks while delegating simple work to smart assistants. The concept of a smart assistant (like your Botkeeper, for example) is quite new in artificial intelligence accounting. In the future, we anticipate smart assistant tools to fully complete basic accounting tasks, allowing accountants to focus more on preparing assets, liability, and capital account entries (among other things), all of which require a human touch.
There’s No Need to Fear Automation
Accounting already feels the powerful influence of artificial intelligence. After all, AI and machine learning are already integral parts of our reality, and they aren’t going anywhere.
That said, there’s still a lot to learn and accomplish with automation. You can bet that we’ll start to see more solutions emerge that will aid accountants, like machine learning as part of risk assessment and continuous accounting becoming the standard for all accounting operations.
All these changes will inevitably impact the nature of the accountant’s work, as AI will gradually automate all the routine tasks and operations. It’s worth reiterating time and again: artificial intelligence won’t take your job away. Instead, AI accounting solutions will be the help you need to do your job more effectively.
If you’ve seen enough and are ready to explore the opportunities that come with automated accounting by Botkeeper, click below to schedule your free personal assessment.