How Are Accountancy Firms Using AI?

According to the 2024 Generative AI in Professional Services Report from the Thomson Reuters Institute, many firms remain cautious about integrating Generative AI (GenAI) into their workflows.

However, Artificial Intelligence (AI) is beginning to revolutionize the way accounting firms can operate, enabling them to streamline processes, improve accuracy, and provide greater value to clients.

Which firms use AI?

The number of firms adopting AI in the accounting industry is on the rise, with firms from the Big-4 down to local boutiques increasingly using AI solutions to enhance their services.

This is primarily being driven by the availability of open source tools such as ChatGPT, although it is expected this trend could soon shift to more industry specific technology as providers bring their own GenAI solutions in the near future. 

But how exactly are firms using AI?

Automation of routine tasks 

AI-powered software can now automate repetitive and time-consuming activities such as data entry, invoice processing and reconciliations, performing them much faster and more accurately.

This is reducing human error and freeing up valuable time for professionals to focus on higher-value activities. 

Enhanced data analysis

AI algorithms can analyse financial data from multiple sources including bank statements, invoices and expense reports to identify potential areas of improvement, detect irregularities and make recommendations for optimising financial performance.

AI could even predict future trends by analysing historical market data to provide valuable insights into potential risks and opportunities.

Improved compliance and risk management

AI has significantly improved compliance and risk management by automating the monitoring and analysis of regulatory changes by quickly scanning through extensive legal documents, such as tax codes and regulations, reducing the need for manual research.

Streamlined processes

AI has also transformed the audit process. With AI-powered audit software, the process of manually reviewing financial data has become more efficient and accurate, identifying potential risks and flagging suspicious transactions.

These algorithms learn from past audits, improving their ability to detect anomalies and potential fraud, allowing for more thorough and effective assessments and enabling more valuable recommendations to clients.

This should also instill more confidence in the accuracy of financial statements.

Conclusion

While many firms remain cautious about fully integrating GenAI into their operations, the potential of AI within the accounting industry is undeniable. As firms begin to adopt these technologies, they are poised to deliver more accurate, efficient, and value-driven services to their clients.