How AI is transforming accounting and finance

Backed up by machine learning, AI has the ability to draw conclusions humans may have overlooked

With the ability to learn and adapt with use, artificial intelligence (AI) is one of the hottest topics today. While the AI of today isn’t the AI we envisioned in our childhoods, the type of AI that included a robot uprising or a supercomputer plotting our demise — it is, without a doubt, quite intelligent, very capable and improving quickly. In fact, because it can digest and analyze untold amounts of data much faster than any human could, and further enables computers to make decisions that were previously reserved for human minds, AI is being used in industries all over the world.

This means that from digital marketing to accounting and finance, anything and everything AI touches is ripe for a transformation. AI cannot only act without human input but also draws conclusions from large amounts of data fed into it, this transformation rings especially true for industries in which numbers and data are the lifeblood, case in point, accounting, and finance.

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How AI Is Transforming Accounting and Finance

With the exception of computers brought to us by the digital revolution, accounting and finance haven’t changed very much in the past hundred or so years. That is until AI came into the picture and brought its many abilities and capabilities into play. In other words, accounting firms used to favor humans for data processing and similar tasks, they’re now looking beyond a human workforce and into one powered by AI.

Why the change? Why are these firms now considering AI for jobs that used to be up to us? 

Well, as we covered earlier, AI is rapidly advancing and can now process data at lightning speed – a speed so fast that humans can’t even compete. Additionally, because it has machine learning backing it up, AI can learn from data and draw complex conclusions that humans would have completely overlooked. Along similar lines, because it relies on code and programming to ensure everything goes according to plan, AI can greatly reduce or even eliminate errors that their human counterparts would have failed to notice.

The thing is, while at the face of things all of this sounds good, and even though AI has the power to completely revolutionize finance and accounting, there is an ongoing debate as to whether it should even be allowed to do so.

Humans vs. machines

The debate on AI’s use in accounting and finance surrounds the prospect of displaced human workers. On the one hand, machines can perform certain tasks better than humans while not collecting a single paycheck. On the other, these people are left jobless – should their livelihood be compromised for a better ROI and bottom line?

Some argue yes and others argue no. But, and this is a big but, while some see the coming of AI as a sign that we’re being replaced by robots, this is not entirely true for accounting and finance. Yes, while some accountants will inevitably lose their jobs, a large percentage of them will actually use AI to support their decision-making and generate new insights from data. For example, as the consulting firm Accenture said in its From reporting the past to architecting the future report, machines and AI actually complement brain power:

“This steady influx of intelligent machines into the finance workforce will not overrun humans, but there is a tipping point for finance jobs on the horizon," Accenture report stated. "As routine tasks become automated, finance professionals will be freed up to focus on more judgment-intensive activities. Some jobs will disappear, others will transform, and new roles will emerge.”

In other words, instead of replacing human accountants, AI is taking over menial tasks so that humans can focus on higher-level things that require human insights that can’t be replicated with machines. As AI takes over more and more of these repetitive and time-consuming duties, human workers will need to refine their skills and learn to use AI’s capabilities to their advantage to increase their own productivity.

As creative agency Appnova mentioned, "On the one hand, AI and machine learning are helping companies and marketers get a more profound understanding of their customers. Algorithm AI is much faster at extracting critical information and data and are able to divide a market into much finer segments."

Therefore, as AI permeates more and more of the accounting and finance industries, more and more tasks will be automated, leading to improved operations and overall lower costs. This creates firms that are more productive and efficient, and who can also take on more clients than those who haven’t embraced artificial intelligence.

Final thoughts

Forbes predicts that "by 2020, accounting tasks including tax, payroll, audits and banking will be fully automated using AI-based technologies, which will disrupt the accounting industry in a way it never was for the last 500 years, bringing both huge opportunities and serious challenges."

AI has the power to transform the accounting and finance industries. It can process, analyze and predict faster and more accurately than any human ever could. As it does this – take over an increasingly amount of tasks previously reserved to humans – workers will be able to devote more of their time to higher-level work that requires actual brainpower, and that these AI-enabled computers can’t handle; can’t handle yet, that is.

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