Friday, March 31, 2023

Will Computers Replace Accountants?

Technology has made significant advancements in every field, including accounting, Will Computers Replace Accountants? in recent years. Many functions of the accounting process are being automated these days with the help of accounting software. Numerous basic accounting functions like bookkeeping are now done via computers. Many businesses use the accounting software themselves. However, Will Computers Replace Accountants? many prefer to outsource their accounting needs to accounting services providers who automate the entire process. This advancement has created a lot of doubts in people’s minds that computers will slowly replace accountants. But such doubts are not entirely true. Automation of the accounting process doesn’t erase the need for good accountants Will Computers Replace Accountants?. Let us look at this issue in detail.

Also read: Ways Business Intelligence Can Help Companies Perform Better and Grow Fast

What does an accountant do?

The duties or responsibilities of an accountant vary based on business and position. However, there are some common responsibilities that an accountant must perform, which include:

  • Tracking and recording the financial transactions of the business
  • Ensuring the financial statements are accurate and in compliance with the relevant regulations and laws
  • Preparing and maintaining all required financial reports
  • Preparing and filing tax returns and ensuring taxes are paid accurately and on time
  • Analyzing the financial reports to identify issues, strategize solutions, recommend best practices, and ensure efficient business operations
  • Offer solutions regarding cost reduction, increasing revenue, and profit maximization
  • Conducting business forecast and risk-analysis assessments

Accountants are legally liable to ensure that their clients’ financial records comply with relevant laws and regulations. Businesses can have their accounting and bookkeeping processes managed by in-house accountants or outsource them. However, outsourcing the accounting process to an accounting services provider is more beneficial as it is cheaper, and the service providers also have a team of expert accountants.

What is covered by AI in accounting?

Computers and AI cannot handle all the parts of the accounting function. The repetitive accounting tasks can be automated, such as data entry, payroll, bank reconciliation, contract interpretation, and report generation. Automating the accounting services eliminated the risk of human error. Even though the tasks are automated, human presence is required to manage the accounting software. Accountants or accounting services providers must manage the tasks that cannot be automated but are related to accounting. 

Even though AI is cost-effective, faster, and less prone to errors, there are some limitations of AI in accounting, such as:

  • Inability to make strategies:

One of the biggest limitations of using AI in accounting is its inability to make strategic decisions. AI can record the data and prepare reports based on them to make them easily understandable. But humans are required to make any strategy and business decisions based on those reports. 

  • Cannot confirm the reliability of source data:

AI is faster and more efficient in performing accounting tasks. However, AI cannot determine whether the source data is reliable. It cannot flag out suspicious expenses and is susceptible to trickery.

  • No accountability for ethical and security issues:

AI may be able to perform all the accounting tasks, including strategizing, at the organizational level in the future. But it cannot be held accountable for any accounting scandals due to ethical or security inefficiency. It cannot make ethical decisions, and any breach in the security system can lead to a business data leak.

AI will support, not replace the accountants

Now, about the question of whether computers will replace accountants. It is not exactly correct. AI is efficient and faster than human resources in accounting, and it also makes the accounting books error-free. However, it works only on repetitive accounting tasks that take unnecessary time and human effort. Some popular accounting software providers like Intuit and Xero also use AI in their software to manage basic accounting tasks. So, the risk of replacement is there only for bookkeepers and accounting clerks who conduct data entry and other repetitive tasks.

In any case, AI cannot replace human accountants completely. Accountants will still be required to manage the AI technology in accounting. Though the accountants will need to learn some skills to survive in the age of automation, such as:

  • Big data skills: 

‘Big data’ means the data that moves fast and in huge volume, making it difficult to track and understand without the help of accounting software. Accountants need to familiarize themselves with AI accounting software and learn how it works. It will help them analyze and interpret huge volumes of business data. 

  • ERP skills:

Automation of accounting function means only the accounting knowledge will not help manage the accounting process. It is important to develop numerous skill sets, including knowledge about ERP (Enterprise Resource Planning) software like Oracle and SAP. Accountants also need to develop strategizing skills like a CFO to make decisions based on the reports prepared by the accounting software.

  • Programming skills: 

It can be a possibility that the accountant is tech-savvy enough but couldn’t find accounting software that can fulfill all business needs. In such cases, having programming skills will be beneficial. With the knowledge of programming languages like C++, Java, and Python, accountants can design their accounting software as per business needs. 

It is better to be in sync with the technological advancements and changes going on in the accounting field. Learning new skills is never bad; it is always beneficial in the long run. It will help save time and provide an opportunity to focus on difficult and more important tasks.

AI will transform the accounting field, not replace the accountants. It is a tool that accountants can use for efficient working. The presence of AI just means that accountants and accounting will have to evolve. Businesses will always need accountants to analyze and interpret the accounting reports prepared by AI. Accountants and accounting services providers already use accounting software to manage the enormous business data, so not much will change.

Everything considered, it can be concluded that AI will not replace the entire human resource; it will just replace the human resource that cannot use AI technology for the accounting function. No matter how advanced the technology is, human instinct, experience, interaction, and compassion will always be required to complete the accounting process.

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