Artificial Intelligence: The accountant’s friend or foe?
At the Future of Accountancy event hosted by CPA Ireland in September, our CEO Mark Edmondson presented a session on Artificial Intelligence: The accountant’s friend or foe?
In this session, some of the topics Mark touched upon were around:
- Introduction to AI
- Humans vs AI
- Practical applications
- The foundations for an AI strategy
If you missed the live session, you can now watch the full video on demand below:
Firstly, what is Artificial Intelligence (AI)?
AI is a wide-ranging branch of computer science involved with building smart technology capable of performing tasks that typically require human intelligence, or to put it simply, automating a task or an activity that we have done before. But more than simply an automation play, AI is essentially starting to replicate some of the problem-solving capabilities that humans pose.
First conceived in 1955, AI is not a new concept but has been receiving a great deal of attention over the last few years. It has taken a little while for it to be married with some of the dynamics that have changed over recent years, particularly around the prevalence and the availability of data and has really certainly changed in the professional services environment of how AI techniques can be applied.
Technology for a long time has been able to look at a process that has been performed and where it is consistent or repeatable start to automate that, be it through more a physical nature through robots or a machine or progressively through software applying that same process. However, it is the cognitive capability, problem solving and thought process of humans where AI starts to take it to a whole new level.
Delving further into the strands of AI
AI is a very broad term and there are many different strands from cognitive computing to machine learning that make up the foundations of AI. Two terms that are very comparable and used interchangeably are machine learning and AI but there are key differences – machine learning is trained to do one task and being an expert at something narrow whereas AI has broader cognitive capability.
Let’s take Google’s DeepMind AlphaGo software as an example; the first computer program to defeat a professional human achieved this by watching humans but then was succeeded by AlphaGo Zero which is completely self-taught and in three days beat AlphaGo. You could probably relate that to some of the ways that accountancy services are performed and begs the question, should technology learn from humans that are carrying out the services right now or should the technology reinvent the way the service is being performed?
Probability of computerisation
A 2013 study by Frey and Osborne on The Future of Employment paints a bleak picture of what is coming down the road in terms of how susceptible jobs are to computerisation. By implementing a novel methodology to estimate the probability of computerisation of various occupations, it was found that:
- There is a 58% probability of Personal Financial Advisors being computerisable;
- There is a 94% probability of Accountants and Auditors being computerisable;
- There is a 98% probability of Bookkeeping, Accounting and Auditing Clerks being computerisable;
- There is a 99% probability of Tax Preparers being computerisable.
However, it’s worth bearing in mind that this data is based on what tasks accountants did nearly 10 years ago and that the role of accountant has changed dramatically over the past 8 to 10 years. Technology has been strongly adopted in that period and we now have the ability to acknowledge these trends and reshape and move what it is that an accountant does – from the legacy way of performing a service to reposition and elevate the role of the accountant in order to provide more value to the client they serve.
Two key effects on the future of work
Author of A World Without Work: Technology, Automation and How We Should Respond, Daniel Susskind supports this sentiment and presents two key effects on the future of work:
- Substitution effect: the automation of work, exchanging humans for machine.
- Complimenting effect: the enhancement of work, increasing the value of human effort.
He proposes that in the next 10 years, the complementing effect exceeds the substitution effect, leading to job creation.
Keeping that in mind, we believe that the next 10-year window presents a strong opportunity for those in the accountancy profession who are embracing technology and embracing the opportunities that lie ahead to grow and ultimately succeed.
So where does Inflo sit within all this?
When we talk about technology in accounting, we face a large array of buzzwords and naming conventions. One of the barriers to adopting technology is understanding what all these techniques are and how to apply them to the work carried by accountants right now e.g. which one should be incorporated to help the way audit work is performed or how can tax processes be automated?
Inflo provide accountants in practice with a cloud-based software solution that allows them to work collaboratively with their clients. We have found that accountants are more focused on what these techniques do as opposed to what the techniques are, so we converged all these emerging techniques into one simple solution – Inflo Hybrid Intelligence (InfloHI).
Inflo Hybrid Intelligence represents the future of accounting: a hybrid of emerging technologies with human intelligence to maximise value and impact.
How does InfloHI supports accountants in practice?
Techniques such as machine learning, robotic process automation and AI are changing the face of accounting. InfloHI converges the most advanced techniques available to augment your firm’s expertise.
InfloHI targets the pain points of accounting firms and their clients, applying the most appropriate technique to ensure relevance and reliability. Whether applying robotic process automation to data ingestion, machine learning to fraud assessment or process mining to business cycles, InfloHI instantly performs thousands of calculations across millions of transactions. It transforms the way accounting firms work with their clients.
Begin your AI journey today…
The key to AI success in your firm or any other scenario is simply humans. Humans, people, talented individuals are going to be the key success factor for a firm to be able to harness and embrace AI.
For accountants in practice, start applying AI in your services today and for accountants in industry, ask your advisors how AI can add more value to your business.
Remember, AI is an augmenting capability that will ultimately benefit the profession.
If you would like more information about any of the topics in this article, please fill out and submit the form below. Alternatively, to get started on your AI journey, sign up for Inflo for free NOW.