AI and Accounting: What the Future Holds

At this point, we can’t escape Artificial Intelligence (AI) because it’s everywhere. News shows talk about it and the blogs and magazines are writing endless articles about what’s next. While movies are focusing on the darker themes of the technology (Insert ominous Terminator quote here), AI is actually transforming our world for the better.

Artificial Intelligence enables computers to perform complex, decision-based tasks that were once only thought capable by humans. Machine learning enables systems to understand behaviors through repetition, which makes the computer better at analysis and decisions.

If you’re new to AI, you’re not alone. The technology is ever-evolving, and what felt far-off a decade ago, is now our everyday thanks to Siri, Alexa, and chatbots. Not to mention, there are plenty of other daily interactions with AI you may be having and not even realize it. In Dan Brown’s latest book, Origin, one of the main characters is an AI-based personality named Winston. Just a few years ago, it would have seemed far-fetched for this to be a reality-based novel, not strictly sci-fi. Now? It’s totally believable.

When it comes to accounting, AI is a term on everyone’s mind because a lot of the financial firms have invested in it, including the Big Four (Bank of America, Wells Fargo, JP Morgan Chase, Citibank). AI has changed the game because it helps cut the time accountants have to spend on audits and asset estimates. Machine learning and artificial intelligence will help accountants become more productive and proficient, but they’ll be able to provide hands-on service to their clients rather than just crunch the numbers.

Accountants will get more freedom

Banks and tech companies alike are not only investing in AI for practical reasons of keeping up with the times, but also to innovate, to push harder for new breakthroughs that could change their business models. Machines aren’t going to replace accountants overnight, but what they are capable of is taking complex financial problems and solving them much faster than their human counterparts.

Chatbots answer the everyday questions from customers and are increasingly becoming capable of handling tier 1 level support. Additionally, they can answer questions about your latest account balances, when certain bills are due, the status on accounts and more.

D.R.E.A.M. (Data Rules Everything Around Me)

At the center of the AI revolution is an overwhelming amount of data. Because AI can parse and collect data at such a fast rate, we can see trends and analyze swaths of data, and manage and sort it properly. We can learn from what the machines are telling us. They see patterns that we couldn’t imagine, but also they can deep dive into areas we only could scratch the surface.  

Because companies are investing heavily into AI, some tools feature natural language processing capabilities, which can navigate deeds, contracts and other documents. They even extract specific keywords and then digest that information to break it down even further.  

At ScaleFactor, we’ve invested heavily into being a data-driven company. Our data scientist uses machine-based learning to analyze billing systems, what our processes are accomplishing, and ultimately to learn what our customers want. We can proactively fine-tune our operations, but also save ourselves a lot of hours trying to figure out the Rubix Cube that is data collection.

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The future is in automation

Humans will be free to take on client-based tasks while accounting processes will be automated. Tasks like bank reconciliations will be streamlined, making everyone’s lives easier. But, one aspect the machines won’t be able to supersede is a human’s emotional intelligence; we’ll always react differently than our digital counterparts.

There are already AI-powered invoice management systems in the market with digital workflows that learn invoice accounting codes. AI will help vet new suppliers by checking tax information and credit scores without their human counterparts ever having to lift a finger. The process will be fully automated. We’re already starting to see this trend emerge.

Expenses and monthly and quarterly close processes will move quicker because the primary inputs will be automated. They will be equipped with systems pulling from established, and continually learning data sources. This will allow teams to think proactively rather than reactively at the last minute. Monthly numbers will be accessible much faster. When it comes to the expenses, there are already applications in the market that allow for speedy reimbursement. Users just have to snap a photo on their iPhones, while the information uploads and is approved with a swipe by the boss.

AI will speed up the auditing process because instead of the possibility of human error, the chain will be entirely digital, allowing for a tighter, more precise review. Auditors will be able to access data and files in perfect order which allows for efficiency and accuracy.

We already do less paperwork than ever, but as AI continues to develop, we’ll see procurement and purchasing processes be transformed through API’s which will utilize data, and track price changes, along with any anomalies along the supply chain.

AI allows accounting companies, but also tech companies to solve problems in ways we’ve never considered, thanks to the data we’re armed with. We’re no longer talking about hypotheticals; we’re talking about advances our team can realistically develop. AI helps conduct accurate assessments while accessing thousands of accounts, compiling information to make educated choices.

For accountants, the future means they’ll need to adopt the current best practices to stay ahead of the game. There’s a lot of software out there right now that can help streamline their workflow. Don’t look at AI as a means that will phase out jobs, but a means to do more meaningful work. Getting familiar with data management and new technologies will only help as more and more Saas (Software as a service) options become available and adopted by the industry. It’s not a wild assumption to say that within the next five years, AI will have mind-blowing capabilities. 

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