Accounting, as a profession, is centuries old. At its advent, humans relied almost exclusively on their brain power. But numerous scientific advancements have given birth to tools and technologies that have made their job much easier.
Most businesses these days combine accounting, AI and automation to find the perfect balance between our brain power and modern technology.
Machine learning is being built into the technologies that are used by humans to send and receive information. The hope is that these ‘smart’ machines will learn from human inputs and lead to reduced use of manual labor. The key aspect of AI is that it can form its own conclusions from copious amounts of data and adjust activities based on those in real time. This helps it to learn quickly and the process can be applied to entire organizations.
Virtual accounting firms in India have completely integrated AI and automation into their processes. This makes them a lucrative option for global companies looking to outsource accounting to India or looking for offshore accounting services.
Impact of AI on accounting
AI has changed the course of a number of industries and accounting is one of them. AI has automated tasks and increased accuracy, thus leading to greater profit margins and better timelines. Let us take a look at the ways in which AI has affected today’s accounting:
AI has replaced a number of jobs: A lot of the accounting tasks previously done by humans have been automated by AI. AI has taken over data entry and audits. As these were the most standard tasks for accountants, they are now finding it hard to bill for the same.
AI has led to new accounting specialities: As AI has taken over the tedious aspects of an accountant’s job, they need to add value elsewhere with their extra bandwidth. They can offer financial advice to whoever wants it. They can also improve their bookkeeping accuracy and diversify the services they offer to their clients.
AI and automation provide detailed insights: A number of accounting platforms are moving away from just accounting towards analysis. They are doing so because AI is sieving through all the data and providing valuable insights to their clients. This is helping accountants provide expert financial counsel to their clients.
AI has prompted accountants to be more proactive: As AI has taken over the menial tasks, accountants can now venture out and seek more business endeavors. They can act as financial consultants to their clients. This entails making sure the client is ready for financial transactions like acquisitions and mergers, business loans, restructuring, strategic reviews, etc. Accountants perform these jobs in real time based on the insight provided by AI working in the background.
What are the accounting activities that AI can perform?
There are a number of tasks in accounting that AI can perform seamlessly. Let us take a look at some of them:
Enforce corporate policy: AI is able to enforce complex corporate policies in a short time and is also faster in uncovering financial non compliance issues in the financial data provided. AI can scan all documents like employee receipts, bookings, transactions and so on to uncover purchases outside of the company policy. This streamlines the job of auditors. It also ensures that all employees follow company policy as there is no human error to exploit in this regard.
Streamline data entry and analyze the same: AI can track tedious and time-consuming transactions with ease. This takes a huge burden off financial managers. AI, these days, is also capable of expense tracking. So, it can extract receipts and then put the expenses into categories based on expenditure. At the end, it also populates reports so all expenses are gathered in one place. This makes it easy for managers to analyze their expenses.
Reduced risk of fraud: AI can audit 100% of all spending reports. This is very useful for detecting irregularities in the expenses and financial data. So, auditors are now able to spot fraudulent spendings even before expense reimbursements occur. The high scalability of AI ensures that it can handle high influxes of data with zero compromise on accuracy.
Budget forecasting and tax preparations are two other aspects that AI excels at in accounting.
How do accountants stand out?
While AI is smart and has reduced the use of human labor to a great extent, accountants are still invaluable. So, what is the use of accountants when AI is doing all their menial tasks?
Consultation and advice: This is the best way for an accountant to stand out. Clients who are looking for consultation services will always prefer a human accountant over AI.
Specializations: Accountants who specialize in certain aspects will always be in demand. For example, forensic accounting, tax law, etc. are some of the specializations that accountants can consider.
Incorporate AI in their services: This is the smartest move that an accountant can make. Instead of treating AI as a threat, accountants can integrate AI into their services. This will help them automate routine activities and leave them with greater bandwidth for high value tasks.
Complex software usage: AI can do a lot of things but using complex software isn’t one of them. It can perform a few functions but cannot do so alone. Moreover, it is important to keep a human eye on it to ensure things are being done correctly.
Human touch: No matter how smart AI becomes, it is only a machine. And human touch is in great demand in the digital age. Even though AI is supremely efficient, people still prefer interfacing with a living person instead of a machine.
AI is the future of accounting andso there is no point in shying away from it. Instead, incorporating it into your business will help you bolster things. So, if you are looking to hire an accountant from India, you have come to the right place.
Contact us today to get started. In case you have any query or confusion, our experts will be glad to help you out.