There’s a lot of buzz in the air about artificial intelligence. Depending on who you listen to, AI can work miracles, perform magic, or possibly take over the world. The trouble is, all the buzz can make it hard to actually cut through the hype and figure out how to best use AI.
Fortunately, there are some very real uses for artificial intelligence in business today. And while they might not be magical, they can make a huge difference to your company.
Finance and accounts payable are great areas for implementing AI tools. Using AI in accounting and finance yields insights that can drive better decision-making. AI bookkeeping can boost your bottom line, improve efficiency and help you make the most of your limited resources.
Not sure how to implement AI and machine learning tools in the right areas? Keep reading to learn everything you need to know about the future of accounting and finance.
Current State of AI Integration in Accounting and Finance
In many ways, AI’s core set of capabilities can shine in accounting firms and throughout the accounting industry. AI can automate data entry, saving companies time and resources and protecting them from costly human errors. Just as crucially, AI can perform basic data analysis and transaction categorization.
AI-driven organization and analysis are helping companies spot trends and patterns that drive smarter decisions down the road. Accounting departments are already using AI in accounting for payroll management and employee reimbursement.
Finance teams offer countless examples of AI tools in accounting to create budgets and forecast the year to come. AI-driven bookkeeping tools like Zeni can automate and present your financial data in real-time, as well as offer powerful analysis and insights. Booke can extract figures from databases, categorize transactions, and even reconcile accounts. Tools like Truwind use AI to create accurate monthly financial reports.
Benefits of Using AI in Accounting and Finance
It’s hard to overstate the benefits of AI in accounting and finance. And teams are constantly figuring out new ways to expand the role of AI in accounting. But we do know that leveraging AI can create a lot of advantages for just about any operation. Here are some of the most beneficial areas for implementing AI.
Automate Repetitive Tasks
AI shines at automation. It can transform tedious, routine tasks and business processes like data entry. This means that your company can use AI tools to enter figures from invoices and receipts, saving time and resources.
Manual data entry tends to be full of errors. Even the best workers make careless mistakes entering data from invoices. Tired, distracted, or overworked accountants make even more mistakes. Unfortunately, even minor accounting errors can cost your business time and money.
Switching to AI-powered automation eliminates human error and saves companies the headaches involved in correcting mistakes. Using AI tools can confirm that your employees are always paid in full and on time. It can also ensure that you never double-bill your clients or forget to make a payment to your vendors.
Identify Patterns and Anomalies
Worried about financial fraud? If you’re not, you probably should be. Reports show that small businesses are at a high risk of experiencing fraud – even higher than corporations or non-profits.
The good news is that AI excels at spotting patterns and anomalies. That skillset makes AI the ideal partner for identifying financial fraud. AI can be configured to automatically flag purchases that are unusual or out of character – in other words, purchases that don’t fit the usual pattern.
If someone uses the company credit card to make a fraudulent purchase, for example, AI can notify your accounting department right away so that they can put a hold on the card. Using AI in this way lets you keep an eye on things, even when you don’t have a lot of time. It’s like having a team of investigators who are always on the job, keeping your finances safe.
The better you can predict the future, the better you can plan for it. AI helps you identify patterns and trends so you can forecast your budgetary needs and financial performance more accurately.
Forecasting relies on data for its accuracy. Data on industry trends, economic indicators, and consumer spending patterns can all help accounting teams make smart predictions about the year to come. AI tools can make sense of the reams of data available today. Algorithms can organize, analyze, and spot patterns in big data when humans are overwhelmed by all that data.
By using AI to predict trends for the year to come, you can make informed decisions about inventory and staffing so that you can make the most of your resources.
Remember the old days when people used to talk about “having a hunch” or “going by their gut?” Sure, sometimes it’s a good idea to follow your heart – but the best business decisions are the ones made based on information and critical thinking.
AI can help you make smart, data-driven decisions. Analyze your finances across departments, by quarter or by year. Spot micro-trends and identify early indicators of downturns so you can be on the lookout for problems in the coming year.
Hesitating between two possible actions and unsure how to decide? AI can analyze your records so you can study the outcomes of similar moments in your history. In fact, you can use data to make such detailed predictions about the future that you’ll feel as if you have a crystal ball.
Every business seems to be doing more with fewer resources these days. Fortunately, using AI tools can help you reduce costs so that you can make the most of your limited resources.
AI can automate processes like bookkeeping, reporting, and invoicing. Automation reduces the cost of labor. It's also worth noting that automation eliminates the risk of costly human error. Not only will you save money with error-free automation, but you'll also save valuable resources you might otherwise spend on correcting human errors.
Depending on your sector, you may face strict regulations and have an intense burden of compliance. AI can help.
AI tools can automate record keeping and then store the information in an easy-access database so that you never have to worry when it’s time for an audit. Your accounts are always in order in case of inspection.
With the right AI tools, you’ll be able to share your data, summon up your records, and compare your records against your own history, all with just a few keystrokes.
Provide Useful Insights
The accounting profession runs on insights. AI-powered systems can mine your business history – and sift through reams of external data – to come up with unique, actionable insights.
Identify areas where your company may be wasting resources, for example, by examining your financial records. You can also use AI to spot unnecessary bottlenecks in your workflow.
Challenges and Risks of AI in Accounting and Finance
Everything worthwhile comes with its own challenges. AI is no exception.
There are some real concerns about AI when it comes to data privacy, ethical considerations, and potential job displacement. As we have seen, AI is a powerful tool, which means it can potentially cause real problems.
Some people worry that AI will lead to widespread unemployment, for example, by eliminating the need for certain jobs. Others fear that AI-powered tools will make it too easy to collect personal data, leading to invasions of privacy. There are also concerns that AI will reinforce existing racial and gender biases.
Fortunately, there are solutions to these problems, some of them involving AI.
How These Risks Can Be Mitigated
AI can help alleviate concerns about job loss by providing new opportunities for employment. AI can handle tedious manual tasks, freeing up employee time for more challenging work. In the future, employees will need to operate the AI – prompting AI, for example, or using its analysis to craft business plans.
AI tools can also be used to safeguard privacy by increasing data protection and encrypting sensitive data. In a similar way, AI can be used to monitor communications for ethical considerations, verifying that codes of behavior and conduct are followed consistently.
AI Forecast in Accounting and Finance
AI is still a new technology, and it will keep evolving in the years to come. AI will continue to be an important part of business.
It’s likely that AI will become more fully integrated into workflows so that employees will work smoothly alongside AI tools. AI can provide insights, data analysis, and visualizations that help teams with forecasting and decision-making.
AI is already powering virtual assistants and chatbots, which help businesses deliver information more quickly and efficiently. The development of natural language processing means that virtual assistants are likely to keep improving and may take on a larger role in business in the coming years. AI is even helping to detect financial fraud by spotting unusual transactions and issuing alerts.
Future-Proof Your Strategies With the Right Partner
Whatever sector you’re in, it seems clear that AI is the path forward. Successful businesses are already finding ways to become more efficient and save resources by automating their manual processes.
Savvy business leaders are also using AI tools to analyze their existing business practices and spot areas of waste and inefficiency. As technology evolves, AI appears poised to deliver ever-better insights and business intelligence.
Adopting AI is one of the best ways to stay competitive in your field. For most people, that means working with experts in the field and getting the right advice. Consulting with the experts can help your company increase efficiency, streamline processes, and maximize profitability in the years to come.
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