By Nicky Tombs.
It’s interesting to read all the media coverage lately about the effect that AI will have on future accounting roles. Apparently accountants, due to our reliance on data input and analysis tasks, are particularly susceptible to computerisation and advances in AI.
For example, existing accounting software providers, as well as startup companies, have already developed systems that allow organisations to scan invoices and upload them directly into the system. The invoices are checked to ensure the calculations are correct and even to ensure the tax ID matches the company. The system then automatically codes the invoices by matching them to previous similar transactions, remembered by the AI. As is always true with AI, the more you use the system, the more it will learn and the more accurate it will become.
Of course, this has led to speculation that accountants won’t be needed in the future. However, Deloitte released a report in 2016 to show that the human element is always required. In fact, according to Deloitte, these technological advances could simply mean that accountants have more time for value adding activities, once time is freed up from more transactional tasks.
This makes sense as it generally follows that any advancements of this nature will throw up new opportunities, if you’re willing to look for them. There will certainly be the opportunity for practice accountants to offer more forward thinking planning and analysis to clients, as accountant time and client money will be freed up for this.
Accountancy firms have already started to offer these more advisory services and build skills in these areas. The aim is to become a ‘virtual CFO’ for firms by building on advice that is probably already being provided to companies in a less detailed way. Accountants are becoming more actively involved in their clients’ organisations, rather than being removed from the decision making process.
Clients will also need expertise to install and maintain the new IT accounting systems, as well as formal training to use them effectively. This is a whole new service area that capitalizes on the existing knowledge of the client’s organisation, allowing the Accountant to advise the best system for that organisation and the best way to set it up. IT focused accountants may be very much in demand in the future.
The benefits of using AI for auditing purposes are easy to see. AI can take over manually intensive tasks such as data extraction, comparison and validation. However, it’s difficult to imagine a world where AI is so advanced that the system will be able to investigate and understand reasons for anomalies. Certainly, current AI is not capable of this, and until the technology equals or surpasses human intelligence, handing over the accountability of this to machines seems unlikely.
Management Accountants, FP&A and Finance Business Partners working in organisations may actually have the most to gain from the new technology. Time freed up from transactional tasks can be spent building relationships and industry knowledge that can add value to organisations, especially in SMEs where there is currently less time available for this side of the role.
There is a disadvantage to the accounting profession. If AI systems automatically take care of basic accounting tasks such as double entry, will that knowledge eventually be lost? It’s likely that Junior Accountants will have less opportunity to build up their basic experience and therefore less knowledge to draw upon to build their careers. Firms will need to be aware of this and provide more opportunities for junior team members to build this knowledge, as well as opportunities to build skills as Business Partners to firms.
One thing is certain, whichever sector of our industry you are a part of, it’s important to ensure that you keep an eye on your own personal development, and, as a manager, that the skills of the accountants in your department are reviewed and developed. In the future, soft skills (especially communication skills), and business acumen will become more highly sought after, and the traditional accountant role must evolve to reflect this, or get left behind.
Nicky Tombs is finance business controller at Mr Green Ltd, an iGaming company based in Malta.