AI is fundamentally a prediction technology. As advances in AI make prediction cheaper, we’ll use prediction more frequently and widely. You might have heard of terms like automation, machine learning, and deep learning. Well, if you are unfamiliar with these innovations and what they mean for your financial and accounting process, let's get you up to speed.
Artificial Intelligence (AI)
Artificial Intelligence is a machine’s ability to rationalize and take actions that have the best chance of achieving a specific goal.
AI is often used to handle high-volume and repeatable tasks faster, more accurately and at a lower cost than humans. These innovations mean AI can now automate routine accounting tasks such as tax filings, financial statements, payroll, and bookkeeping. Artificial intelligence can perform tasks usually done by humans to save time and money for your business. Given enough data, AI could even make accurate future predictions about your business.
What could this mean for finance and accounting? More insight for less time and money.
For example, certain accounting processes require a team of people to collect information like when preparing tax returns. The team reviews data to ensure it's valid, consolidates the information and requests follow-up support on significant variances.
Using AI, you can collect all the information you need, cross-check the info to look for errors in the data, then consolidate it according to your specifications. All of these tasks are done automatically, saving you inordinate amounts of time previously wasted on mundane these tasks. In addition to automating the manual consolidation process, automated processes can display and store all of your information in one place for all to see.
The Benefits of AI:
Saves you money and stress by reducing the time you spend doing mind-numbing, repetitive tasks.
Provides feedback by analyzing data.
Allows employees to focus on more value-added activities.
Improved data quality and reduction in manual errors.
Provides an excellent audit trail.
Easily scalable to meet demand.
Interacts with enterprise systems the same way a human user would — does not require underlying system changes.
With much more automation to come, AI is exactly the kind of opportunity small businesses should adopt and leverage. Start automating your bookkeeping for free with our ReInvestWealth accounting software.
Advanced Analytics Explained
Many large businesses already leverage analytics to obtain financial insight from their accounting data. For example, CPAs in financial reporting roles help companies understand what impacted their financial results and why. In financial planning and analysis roles, CPAs use historical data and assumptions to model and forecast financial results.
All the advancements in AI have increased the predictive and prescriptive capabilities allowing for more advanced business analytics, especially for small businesses that don’t have a smaller-sized workforce.
AI uses data, algorithms, and machine-learning techniques to anticipate future outcomes and suggest the best course of action based on its prediction.
What does this mean for businesses? The role of accountants is evolving to do more than just report key performance indicators (KPI) and make periodic forecasts. Companies take advantage of AI and its analytical capabilities to develop a more profound understanding of new market trends, identify new KPIs for performance management, and improve the accuracy and timeliness of the forecasting process.
To analyze vast amounts of data, it will no longer be sufficient to leverage tools such as Excel or QuickBooks. Instead, businesses need platforms like ReInvestWealth to understand how to leverage the data reported by AI.
The Benefits of Advanced Analytics:
Provides recommendations based on factual data rather than gut instinct.
Can easily analyze vast amounts of data to identify otherwise hidden correlations and trends.
Reduces forecasting time, enabling faster decision-making.
Allows for a deeper understanding of the business and market trends.
Increase the quality of your data and the reliability of your predictive outcomes.
Limits existence of potential bias and human error that may skew outcomes.
What ReInvestWealth can do with AI
While AI-enabled robots will not fully replace accountants, they will substantially transform how they work. Here at ReInvestWealth, we will continue to develop AI models at the forefront of fintech to help transform businesses by giving them a data-driven edge over competition.
The Benefits of having Accountants Equipped with AI:
Expands financial stewardship beyond regular capabilities.
Improves timeliness and accuracy of reporting.
Allows businesses to focus on managing relationships with stakeholders.
Accountants are more easily able to sift through large amounts of data to uncover hidden trends and anomalies.
Shortens financial close cycles while reducing errors.
Has better capabilities to help businesses identify and track core metrics.
Businesses need CPAs to be resilient, adaptive, and innovative to remain competitive and help their organizations navigate this transformative and revolutionary technology. CPAs are in a unique position to help business leaders leverage AI to build efficiencies and maximize Big Data opportunities and insights. The team at ReInvestWealth embraces AI and are proactive in adapting and sharpening their skill sets to meet the needs of an AI-powered, everchanging world.
Written by: Cam Hennessy
ReInvestWealth Founder and CEO: Behdad Karimi Dermeni