How Generative AI Will Change Accounting. Prepare for a seismic shift in the accounting landscape as generative AI takes center stage, reshaping the way we handle death and taxes. This groundbreaking report by Marc Andrusko and Seema Amble delves into the profound implications of this transformative technology on the accounting industry.
Discover the future of accounting and taxation in this must-read report that unveils the power of generative AI. Dive in to stay ahead of the curve and thrive in the evolving financial landscape.
Table of Contents
Genres
Accounting, Artificial Intelligence, Taxation, Technology, Finance, Business, Innovation, Disruption, Automation, Future Trends
The report “Death, Taxes, and AI: How Generative AI Will Change Accounting” by Marc Andrusko and Seema Amble explores the transformative impact of generative AI on the accounting industry. It highlights how this cutting-edge technology will revolutionize the way accounting professionals handle complex tasks related to death and taxes.
The report provides insights into the potential benefits and challenges of adopting generative AI in accounting practices, emphasizing its ability to streamline processes, enhance accuracy, and improve efficiency. It also discusses the need for accounting professionals to adapt and upskill to leverage the power of AI effectively.
Review
Andrusko and Amble’s report offers a thought-provoking and comprehensive analysis of the intersection between generative AI and accounting. The authors skillfully navigate the intricacies of this emerging technology, providing clear explanations and practical examples of how AI can transform accounting practices.
The report’s strength lies in its ability to balance the potential benefits of generative AI with the challenges and ethical considerations that come with its adoption. However, the report could have delved deeper into the specific steps accounting professionals can take to prepare for this technological shift.
Overall, “Death, Taxes, and AI” is a valuable resource for anyone seeking to understand the future of accounting in the age of artificial intelligence.
Recommendation
The field of accountancy in the United States is evolving. Facing declining numbers of practitioners as its current generation of professionals begins to retire, the industry is ripe for change. Enter artificial intelligence, which can execute many accounting tasks, particularly the more mundane. But fintech experts Marc Andrusko and Seema Amble advise that AI cannot — nor should it — replace human judgment. Professional development will remain critical, even as accountancy stands on the cusp of a generational shift. Accounting professionals will find this a useful take on the future of the sector.
Take-Aways
- The next decade will witness a sea change in accounting.
- Artificial intelligence has the potential to streamline many accounting functions.
- Certain aspects of accounting, however, may not prove compatible with AI.
Summary
The next decade will witness a sea change in accounting.
Potentially, some three-quarters of Certified Public Accountants in the United States could retire in the coming decade. The declining number of American students obtaining accounting degrees provides clear evidence that the profession’s appeal is dwindling. Client demand for accounting services is beginning to exceed professionals’ ability to provide them.
“Bookkeeping, accounting, tax preparation, and auditing are fields full of largely formulaic and repetitive exercises that would immensely benefit from generative AI’s gift of efficiency and time savings.”
Generative AI can assist with accounting workflows and corporate finance. Large Language Model (LLM) artificial intelligence performs best when using natural language to synthesize research and provide information to the user. Presently, these models cannot perform quantitative functions.
Artificial intelligence has the potential to streamline many accounting functions.
Certain types of accounting functions appear to lend themselves to the technology, including the reconciliation functions of data gathering and input. LLMs will be able to pull data from unstructured documentation such as receipts, invoices, and contracts. AI may perform research involving, for example, classification, reporting, and taxation of various line items, as well as the synthesizing of data from a confusing universe of accounting standards and tax codes. Other tasks ripe for automation are data analysis, summary, and report production.
“The industry is filled with highly paid professionals who spend many hours per week ingesting data from disparate sources to make recommendations based on the recognition of patterns observed over countless hours of educational training and professional experience.”
AI could be most beneficial to accounting by converting annual tax-season engagements into ongoing consulting services that would provide analysis, service, and counsel to clients.
Certain aspects of accounting, however, may not prove compatible with AI.
Notwithstanding its potential to disrupt the profession, genAI cannot at present function as a reliable substitute for professional judgment and sales. Nor can AI take on acquiring new business, a task that usually falls to senior management. Gaining new clients relies heavily on interpersonal skills, foremost among them the ability to read emotional nuance. Because AI will streamline many accounting functions, it may well threaten accountancy’s primary billing metric: billable hours.
“At the end of the day, it will still be up to the seasoned professional to win new business, sign their name next to a recommendation (even if said recommendation is 90% automated via AI), and stand by it.”
AI-automated manual functions could reduce the value of less senior staff, if not replace them entirely. Learning the mundane aspects of their field is how accountants have historically gained bottom-up experience. LLMs would not replace firms’ training programs but rather supplement the work of those newer to the profession.
About the Authors
Marc Andrusko and Seema Amble are partners at Andreesen Horowitz focusing on financial technology solutions.