Like just about every other major industry on the planet, accounting is being transformed by a wave of automation, powered largely by new machine-learning algorithms, and by Artificial Intelligence more broadly.
But before leaping on this particular train, it’s worth first pondering where it’s heading, and why we might want to get there. What is it that’s so worthwhile about automated accounting, and do the benefits justify the adjustment costs?
Time and Cost Efficiency
The most obvious benefit of automation is that it’s faster and cheaper to have a machine perform a task than it is to have a human being do the same task by hand. It’s been several centuries since the textile industry was revolutionised by the loom, but the same principles are at work in the modern accounting revolution.
By entrusting machines with routine tasks like reconciliation, arithmetic, and data entry, we can free up human capital to perform high-value creative tasks that help to drive the business forward. With the help of modern technology consultancy firms, it’s possible to integrate these technologies into an existing accounting setup, with minimal disruption.
Improved Data Accuracy and Security
As well as being faster and cheaper, automation also has the potential to perform tasks with a higher degree of accuracy. You might think of a CNC machine drilling millimetre-accurate holes in a sheet of aluminium.
Automation, in finance, helps to cut out human error. This is especially beneficial in data handling and storage, and in security checks. While machines can be tricked, and human intervention is still necessary to create an optimally secure system, the benefits of mechanisation here are clear.
You might think of a cloud-based accounting solution, where a machine-learning algorithm with experience of millions of login attempts might be able to distinguish easily between fraudulent and genuine login attempts. This might provide an additional layer of difficulty for would-be wrongdoers.
Enhanced Financial Insights and Decision-Making
It isn’t just speed, accuracy and cost that automation can help with. Through AI, it’s now possible to sift through vast datasets, and provide new and interesting kinds of analysis. This kind of work, in other words, is not just quantitatively different from human work, but qualitatively different, too.
The insights provided by these AI-based analyses can be presented to human decision-makers via modern dashboards and reporting tools, so that they can be acted upon quickly.
It’s likely that in the near future, the involvement of AI in financial decision-making will be established and uncontroversial. In much the same way as a calculator assists in our decision-making (and we think nothing of it), a modern AI might contribute to existing processes, or even inspire entirely new ones.
