AI will revolutionize accounting, but not in the ways you might expect
Artificial intelligence (AI) is everywhere. In the news, on the minds of CEOs, in blogs such as this one. Canadian entrepreneurs are actively working to determine to what degree this burgeoning technology will impact their organizations and industries—and how they should be responding.
That answer will vary depending on the sector, but in finance, we’re already seeing AI and machine learning having a strong influence on how organizations manage their accounting and financial operations. That influence is only poised to grow in the years ahead.
According to a recent survey by global recruitment and HR consultancy Robert Half Finance and Accounting, 52 per cent of more than 300 CFOs polled from across Canada said they felt AI would bring significant change to companies’ finance and accounting processes in the next three years. Fully 38 per cent felt that payroll would be affected, while 55 per cent cited cost reductions as the greatest benefit.
Trailing close behind: reduced human error (53 per cent), improved bottom-line performance (42 per cent) and increased employee efficiency (41 per cent).
It was another finding that was perhaps the most telling. Forty-two per cent of the CFOs surveyed indicated that AI would free their finance and accounting teams to focus on higher value work. This is precisely how we’ve seen the technology reshape the professional services industry in recent years. Rest assured, federal and provincial governments, along with the Canada Revenue Agency, will ensure that lawyers and accountants are always employed thanks to a steady stream of annual legislative amendments. As such, organizations will continue to rely on professionals whose job it is to respond to those changes and develop or fine-tune finance strategies that minimize tax exposure and risk, and deliver optimal bottom-line performance.
As the CFOs noted in their responses, they’re increasingly relying on technology to take the bean-counting out of the accounting business. Case in point: sophisticated software is already helping to manage the more mundane tasks currently handled by accounting departments. Invoice management systems have already largely streamlined accounts payables and receivables processing, for example. But we’ll continue to see broader applications of AI, such as the vetting and onboarding of potential suppliers—even checking their credit or tax scores—managing simple audits and even streamlining procurement and purchasing. The hours once spent tallying and submitting expenses are also being reduced with the help of AI.
What machines will never manage to do is to replace the insights and expertise that an experienced Chartered Professional Accountant can provide. When an entrepreneur needs assistance in highlighting growth opportunities, preparing a succession plan, an international growth strategy or managing estate planning—to name just a few functions—having a qualified financial team on hand will still be essential.
What will change is that our profession will place a greater emphasis on using tools such as AI to optimize our own time-honoured processes and—as the survey indicates—deliver higher value work that can help position our clients for success. Accountants of the future will emerge from their undergraduate programs with some degree of coding expertise, a greater education in work flow management and an enhanced professional focus on analyzing the enormous reams of data that these revolutionary digital tools are already delivering.
If your organization is large enough to employ its own finance department and hasn’t begun embracing AI and other tech tools, now is the time to start. Staff may need to be retrained, some new talent with the right skill sets may need to be recruited, while others may not be able to adapt to this sweeping digital transformation and will need to be replaced. Virtually everyone will require some form of continuous re-training as the technology continues its rapid evolution.
Most importantly, AI should be regarded as a tool to take your organization’s financial systems and processes to almost unimagined levels. The ability to assess and decode complex information could deliver game-changing results, if the data are used effectively. That’s the challenge, and the area where your accounting firm will be more helpful than ever. Information is useless if it can’t be interpreted through the lens of financial best practices, tax and legal compliance and, most importantly, the strategic vision you have for the growth of your business. How you want your company to grow, expand and capitalize on opportunities is entirely unique—and your financial strategy should be customized to suit that vision.
AI will be one tool, among many, that your Chartered Professional Accountant will be putting to even better use to help you achieve entrepreneurial success in the years ahead.
Jenny Lian, Partner