AI is penetrating a wealth of global sectors. This isn’t a trend, it’s an evolution, one the promises to revolutionize commercial processes and communication. From telecommunications chatbots which automate responses to consumer queries to mining data in the biopharma industry for use in drug production and, of course, receipt extracting, AI-powered ecosystems are beginning to automate processes and provide valuable commercial insight.
Though still in its earlier iterations, AI is already showing the potential to shape the future of accounting. Earlier this year, German-based software company Smacc garnered press coverage for using AI to automate accounting systems for SMEs and freelancers. Having received $3.5 million in Series A financing from high-profile venture capitalists, it’s clear that the confidence of AI to solve problems traditionally associated with accounting practices is clear.
Machine learning is, arguably, the Holy Grail of technological autonomy. After decades of speculation, it appears as though the apex of the tasks that computer programs can complete on our behalf is within touching distance. From automating sales and invoices to expenses and managing liquidity, has the time finally come when we hand the reins over to computers?
The Rise of AI
AI as the Holy Grail of computer science isn’t a term coined by us (as much as we’d like to take credit for it!) Microsoft founder, Bill Gates first said this at Code Conference in 2016. Looking back now, it may be hyperbole to say that this was a prophetic remark, however, given the rise of AI, not just in 2016 but, in the subsequent years is proof that our enthusiasm for AI has been anything but dampened.
Today anyone with even a passing interest in AI, whether in its applicational potential, for example, in receipt parsing technology or intelligent robotics can hardly go a few days before seeing yet another link, article or opinion on their Facebook feed or Twitter account promoting one new development or another. Lack of job security and technology run amok are some of the more popular opinions, but surely these are a mite naive. AI’s potential to enrich our lives far outweighs any alarmist and unfounded viewpoints.
AI Accounting Adoption
As difficult as it is for us to break this to any technophobe, AI isn’t on the precipice of mainstream adoption, it’s already happened – penetrating a wealth of sectors, including accounting. Cloud-based accounting packages, like QuickBooks have gone on the record to say that they’re now 75% automated.
Is this a worry for traditional accountants? No. Financial accountants provide much more than merely keeping track of receipts. If anything, the introduction of artificial intelligence applications free up valuable time, that accountants would have spent on receipt parsing and organization, allowing them to focus on aspects of their role that are more intrinsic to ongoing commercial prosperity.
Moreover, the rapid change in client sectors, combined with the introduction of complicated regulations means that human services will become more important than ever to ensure that compliance regulations are met, and financial controls are sound.
Evolution of Global Accounting
This is especially true of blue-chip multinational companies. Managing corporation tax, for instance, is challenging enough in a business’ country of origin, let alone ensuring compliance in multiple regions.
Whereas AI is now being adopted for multi-national expense management, through such valuable capabilities as receipt extracting, for example, it’s not quite capable of proficiently managing complicated tax codes or compliance requirements of working in the EU, USA or anywhere in the world.
Does this mean that this will endure as the technology evolves? Maybe so or maybe not. However, what this does highlight is that at present and for the foreseeable future, accountants are still required to ensure that businesses are financially and legal compliant in their operations.
Foreseeable Challenges for AI Accounting in the Future
Though machine learning can manage a diverse range of tasks, providing that you have enough data to draw from, data scientists still dispute the logistics of how AI’s unique functionality. Indeed, so complicated is the math, it’s almost a Herculean task to re-engineer and decipher how the system learns. This makes diagnosing issues challenging.
Futurists have lauded AI and its ability to revolutionize multiple facets of our lives for decades, yet as we enter the 2020’s it’s becoming clear that any perceived challenges that we may face are swiftly being countered by innovation. However, wholesale deployment at the expense of human manpower is hardly something that we should expect in the coming years.
So, should we expect AI to overhaul the accounting profession? No. However, revolutionary innovations, such as receipt parsing technology, could allow accountants to streamline processes, allowing them to focus on other areas of their job and provide a better overall, customer-centric experience to clients.