Artificial intelligence (AI) is a technology fast claiming its place among regulated industries like legal, banking and accounting. Adoption is seen as a feature of service updates to accounting packages, typically delivered as software as a service (SaaS) in the cloud, or by internal developers using AI platforms to build tools, applications or answer queries directly.
A recent report from Thompson Reuters’ on the Future of Professionals reveals that “40% of tax and accounting firms have no significant AI adoption plans, while those with strategies are seeing a 3:1 ROI on their plans.”
In the report, experts discuss the critical role AI will play in the future of the accounting industry, as well as offer guidance on how to develop and implement AI-forward strategies.
The Rise of AI as an Accounting Software Feature
As with other lines of business, AI has been creeping into the software landscape in the last few years. While early generations of AI might not have been specifically designed with tax and accounting in mind, users found them a useful research tool, as long as they double-checked any information obtained.
Notorious early examples of faux AI included lawyers who used it to present courts with fictional legal precedents and fictitious cases. This brought down the wrath of judges, but helped highlight the value and risks of AI.
Now almost any software tool for a specific market comes with AI features built in that are helpful for tax or accounting use cases. AI’s typical use cases for accounting professionals include:
- Predictive intelligence where machine learning models forecast metrics such as cash flow, identify tax-saving opportunities, and flag anomalies in financial data.
- Performing audit and risk analysis where tools analyse large datasets to detect trends, outlier data points, or assess risk.
- Tax compliance and filing can simplify tax season and support end users through automatic completion of forms, verifying entered data.
- Ensure compliance by checking documents and contracts match the latest information in a world of ever-changing tax and related regulations.
Making AI Part of Your IT and Operational Policies
As with the well-established risk posed by Shadow IT, unauthorized use of AI creates legal and reputational risk for any tax or accounting firm. By building acceptable use policies, blocking access to unwanted sites or tools, and training staff in the correct use and documentation of AI tools are vital for all firms looking to gain an edge through the use of AI.
If employees are left unguided, they are likely to experiment with generative AI or automation platforms without formal advice, leading to inconsistent practices, the risk of data leaks, or regulatory breaches. Even broader functions like fiscal reports for selling or buying a business require use of data where any AI contributions must be carefully managed.
To mitigate these risks and unlock AI’s full potential, firms must embed AI into their broader IT governance strategy and operating rules. This primarily involves adopting an AI platform at the Pro level. This keeps your business and customers’ tax or finance data private, rather than risk it escaping to be used as training data on other systems. Other key steps include:
Evolving Your Existing or Develop New Acceptable Use Policies
To clearly define which AI tools are permitted, under what conditions, and for which tasks. Include guidance on data privacy, intellectual property, and ethical use to ensure compliance with regulations like GDPR or the EU AI Act.
Provide Clear, High-Quality Training & Documentation
Train all staff on how to use AI responsibly in their operational roles and when they are investing new opportunities. They must understand that it is essential to protect inputted data, to verify outputs for accuracy and the risk of other’s copyright material creeping in, and how that translates to shared, customer or public document publishing
Another valuable element of training is explaining how to escalate concerns about rogue or improper use of AI. These steps help to build a culture of accountability and transparency.
Integrate AI Use into the Business IT Strategy
AI use is already accelerating fast as a competitive advantage for accounting firms. Complete and move beyond pilot or test projects. Integrate AI into core infrastructure and operational planning, with KPIs tied to business outcomes such as efficiency, accuracy, and client service.
Establish Governance Roles With Ethical and Bias Safeguards
Assign governance to key leadership roles with responsibility for ensuring AI best practices are implemented and to address any issues. Also, they should drive regular checks to ensure AI systems avoid bias or making hallucinations that can impact decision-making data.
By treating AI as a strategic business asset with performance goals and safeguards, it can become a powerful and managed tool, rather than a rogue experiment. T|ax and accounting firms can foster innovation while safeguarding their reputation and legal standing. The goal isn’t just control—it’s responsible enablement.
Embracing AI Will Drive Business Success and Benefits
Just like calculators, computers and spreadsheets before it, AI is just a tool that businesses can use to improve their performance. All the news and hype around AI can be put to one side by accountancy firms using AI that is trained and managed to operate in a taxation or accounting environment.
The benefits of AI include better trend spotting than humans and traditional backward-looking systems can provide, and the ability to speed up operations and reduce the amount of grunt or donkey work that accountants need to worry about. As long as there are checks and balances to ensure a valid result, AI will be your friend, one that grows and learns with the business for years to come.
