Man and machine have been at odds in the workplace for centuries, with the debate surrounding whether the latter would replace the former revived at various inflection points throughout history.
A new report by Asian broking firm CLSA asserts that "we are fast approaching a world in which humans and artificial intelligence (AI) are bound together in a constant exchange of information and goals -- where people and software will not be much use without the other."
The report argues that the creation of "a truly capable AI ecosystem will be the most important invention in human history to-date,” identifying the industries that will be disrupted in the short term, with accountancy being one of them.
The cloud transformed accounting, and we’re now at the forefront of the next wave of industry disruption.
Constrained by the limitations and lack of connectivity of desktop software in the past, many accounting professionals would either be tethered to their desks or forced to visit their clients in person. Many would spend hours performing manual tasks, like data entry or even printing paper checks. It was a very labor-intensive process, with very little room for value-add beyond compliance-related activities.
Cloud accounting platforms have freed accounting professionals in more ways than one. Data entry has been nearly eliminated, given that information now flows freely between systems. The time required to deliver compliance services, like tax finalizations and maintaining accounting records, has declined.
In response, many accounting professionals changed to offering value pricing or monthly fixed fees to their clients. Cloud-based accounting practices have also enabled advisors to take on more clients. Cloud accounting platforms are now consolidating on a powerful set of technologies that help unlock the potential of vast connections and unique datasets to drive machine learning and establish personalized automation systems for small businesses.
Advanced automation means the way small business owners do their accounting will evolve along with the processes used by the software and their advisors. As an example, the system can start to learn how invoices are coded and begin to predict where the next invoice generated should be coded, cutting the number of mistakes a small business owner makes.
AI and machine learning are already changing the way accountants work today. Given this prevalence and further steps towards code-free accounting, the next logical query is whether accountants will eventually be replaced by robots.
The short answer is no. As technology does more of the traditional data entry work inherent in accounting, we will see more advisors step into virtual CFO roles within the small businesses they serve. The higher level advisory services that help clients feel more on top of their finances are important human functions that cannot be replaced by robots.
Because machines will be highly adept at execution work, such as preparing statements and identifying errors, but not so good at creative work, this is where people will be needed. By pivoting to the creative and providing meaning and context from data, humans will provide an irreplaceable service.
As the CLSA report proposes, people and software will work alongside each other -- with one not much use without the other. While the transition to AI-powered systems may be painful initially for many industries, in accountancy, professionals will automate what can be automated and shift their focus to provide more value to their clients than ever before.
