The objective of the report is to focus on the utilization and impact of AI (artificial intelligence) in the accounting field (Bench-Capon, 2014). The explanation of AI’s influence in the accounting field highlights on how development of this technology has transformed the accountants work as well as efficiency in providing better services to their clients.
While working in huge accounting firm, it is usually identified that clients basically shows their interest in understanding possible opportunities as well as threats, which can arise owing to adoption of AI. Therefore, the audiences of this specific report mainly involve both accounting experts and non- accounting experts.
The vital decision that is to be made by the accounting firm is mainly about the adoption of AI in the workplace. The main reason behind this is that although AI helps to generate numerous opportunities, it might pose threat to hacking of data (Bond & Gasser, 2014). Moreover, there are some clients who think that existing business framework can be in threat owing to implementation of AI.
As the basic aim of this report is to highlight on the different aspects of AI to the accountants, proper information is needed for making these decisions. In fact, the information required by the managers of this accounting firm is the impact of technological development on accountant’s business practices.
While carrying out this study, the keyword that is searched in database mainly involves the concept of AI, its significance in the accounting field along with its opportunities and threats.
The present report provides an overview about the accounting theory and contemporary issues relating to accounting from the perspective of accountants. This section focuses on the Artificial Intelligence (AI) and its significance on the accountants work. AI has been accredited as one of the biggest boons of engineering, which revolutionized the global market with its varied potentiality and functionality (Brodie, Mylopoulos & Schmidt, 2012). This technology was initially developed for military purpose, which became beneficial to them for achieving their target. AI has been uncongenial to psychology and thus has benefitted largely to the accountants. Since then huge development has been done in AI in order to improve the performance of the organization. However, it also acts as a link between the capability of human thinking and machines and thus allows the machines to make a replica on human thinking capabilities. In addition, AI has helped to reduce the extent of human being effort in any kind of work.This section also depicts how the technology has changed the accountants work in the present decade. It also highlights on risk analysis of AI for assessing various scope of having advantage from using this technology based on the perspective of accountants. Lastly, the recommendations for this AI for making it highly beneficial for accountants have been mentioned in this report.
AI refers to the simulation of the human being’s intelligence processes by the machines mainly computer systems (Ennals, 2012). These processes basically include- reasoning, learning and self- correction. The Defence department of US has introduced this AI in the year 1956 basically at the time when it was not available in the society. The utilization of AI was limited only to usage of defence and had inhibited popularity for advancement in technology. In the year 1970, DARPA (Defence Advanced Research Projects Agency) had utilized it for mapping street for the first time, which brought it to public domain. Furthermore, in the year 2003, DARPA again introduced personal assistants and this further exposed AI in the global market. At the last quarter of 2011, AI gained huge popularity in the global market due to its application. This became a standard for using it in certain fields that includes- medical, automobile, banking, accounting etc. Ghahramani (2015) opines that the best utilization of AI was in accounting field and thus has revolutionized this sector from different perspective.
The main goals of AI includes-
John McCarthy who is known as father of AI defines AI in four ways, which is depicted below:
AI contributes not only in engineering field but also in the field of psychology, philosophy, sociology, maths, neuroscience and biology. The vital components of AI make it updated technologically as well as promote it as replications of humans.
Accountant plays vital role in business organization as they control their profitability level. Based on the accounting concept, the companies evaluate their capacity of production and hence adopt their marketing strategies accordingly (Shoham,, 2014). Increasing advancement of technology in this accounting field has made it highly productive, effective and user friendly based on the ethical viewpoint. In addition, numerous developments occurred after the introduction of AI in the field of accounting in the year 1980. Various instances reflects that implementation of AI has mainly revolutionized financial analysis. Expert system is one of the important developments that occurred owing to utilization of AI, which in turn helped the accountant in making accounting calculations in simpler way (Sol, Cees & Robbé, 2013). In short term, AI has brought several opportunities for the accountants in order to enhance their efficiency as well as deliver high value to the business. On the other hand, in longer term it has also raised opportunities for bringing about additional radical change in the systems for taking over decision related task presently done by individuals.
Recent evidences highlights that AI has increased scope of accountants as new accounting system reduced human efforts through automation. As a result, it increased the efficiency of accountants, simplified their work and improved their performance. For example, implementation of accounts software helps the accountant in doing the work through inserted data and also decreases error (Ginsberg, 2012). However, with less error, the firm faces no extra tax and thus it facilitates to have sustainable organizational structure. In the present era, near about 95% of the accountants faces threat owing to advanced automation capabilities that has been provided by AI. For this reason, the accountants in business are now providing various opportunities to their clients that include- strategy as well as advisory services. Thus, this is how AI reshapes the accounting sector.
Recent evidences reflect that AI has been growing at rapid scale in all sectors owing to its several advantages. Through development of automation, it can be predicted that AI will make more decision making task in future (Sutikno, Facta & Markadeh, 2013). Moreover, it will also enhance the deliverables quality and make the business more sustainable. Apart from this, it has also wider possibility in making business highly sophisticated in future. The opportunities from utilization of AI in different fields are given as under:
By taking into account these benefits of AI, it can be said that all business should adopt this for making their operations better. With less error as well as higher efficiency in work, AI will transform the industry.
Technology has been advancing at rapid speed with increasing growth in business. It has been argued by some researcher that although AI increases the opportunity to decrease the workload for humans, sustainability of human being might be at stake in the present period. On the contrary, there are certain threats that the business faces from the use of AI. From the perspective if accounting, the threats from AI includes-
Although AI poses threat to the accountants, thereby it can be perceived that this can benefit humans in the long run by increasing efficiency and decreasing error in work. Therefore, AI has generous scope of huge development in the accounting firms.
From the above analysis it can be seen that adoption of AI in the accounting firm involves some risk also. However, recommendation has been given in this report for reducing threats for AI and improving efficiency in technology. These recommendations might also help in improving AI performance as well as internal control of the accounting firm. These includes-
Conclusion
From the above study, it can be concluded that AI has huge significance in the field of accounting. It highly affects the accounting firms by bringing about automation technology in work. Owing to development in cloud based technologies and reduction of error margin, the performance of the accounting firms has improved. Moreover, AI also poses threat to the accountant job since the advancement of technologies starts to perform tasks that are undertaken by the accountants. As AI has technologically upgraded over the years, it increases the scope of data hacking owing to excessive internet usage. Furthermore, the recommendations provided in this report should be implemented by the firm in order to increase efficiency as well as accountability of AI for the accountant. Hence, it can be said that adoption of AI will be highly advantageous for the accounting firm as it will aid them in increasing productivity.
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