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Technological innovation is transforming the accounting profession, with artificial intelligence (AI) and machine learning set to have a big impact over the next few years. Cloud-based accounting software Xero was one of the first platforms to see the potential that the cloud held for accounting, and tips AI to be the next big development.
AI, machine learning, and enhanced levels of automation will lower the cost of running businesses. Rather than putting accountants out of business however, new approaches, legislation and efficiencies will cement the position of accounting at the strategic heart of businesses, rather than as a siloed function.
Colin Timmis, Xero’s South Africa head of accounting, comments: “Cloud accounting has already radically changed the role of the accountant. Accountants are increasingly performing the role of business consultants. Through accounting software that’s connected to bank feeds, and receipt scanning tools, they can access a real-time, live ‘ledger’ which they can use to inform advice and recommendations.
“AI and smart machine learning programmes will be the next big thing, enabling automation to further disrupt the industry, and the role of the accountant. From Siri to Amazon Echo and self-driving cars, AI has begun to enter our everyday lives, and the same is true for accounting. There is a perception that AI will put people out of jobs, but this doesn’t necessarily apply to accountants.
“Machine learning could advance high integrity accounting, one of Xero’s key areas of focus, which is when data is not touched by human hands. Coding work would become completely automated and data entry would be redundant. Accountants will therefore have more time to focus on the business and developing growth strategies. Xero’s founder and CEO Rod Drury described eliminating coding as ‘one of the biggest changes that has happened to accounting, ever’.
“AI efficiencies could also boost productivity – something that would benefit South Africa given that we were ranked 52 out of 61 countries in the 2016 Institute for Management Development (IMD) World Competitiveness Yearbook (WCY). South Africa’s small and medium sized enterprises (SMEs) contribute an estimated 52% of GDP yet have traditionally been less able to access productivity-boosting technologies. Just as with cloud technology, low-cost AI tools could unlock SME productivity and competitiveness, boosting the whole economy as a result.
“Research we conducted with World Wide Worx revealed that South Africa’s small business owners have good relationships with their accountants. The majority (88%) use an accountant or bookkeeper regularly, and 93% report a “good” or “very good” relationship with their advisor. Accountants will have to adapt, but developments in AI have the potential to enhance these relationships even more.”