The accountancy sector has been undergoing a massive upgrade with technologies like Artificial Intelligence and cloud accounting gaining ground. These are some of the most beloved technologies in the contemporary world. They are helping businesses grow at an unimaginable pace, bringing state-of-the-art solutions to all modern business problems. The present-day organizations are deriving great profits and business advantages in the ever-expanding, global, competitive business world.
The combination of AI and modern cloud-based applications makes the future of accounting and finance look extremely flourishing and profitable. It seems inevitable for the present-day accounting firms and Certified Public Accountants (CPAs) to embrace automated cloud tools operating in tandem with Artificial Intelligence, to optimize their operations, reach a wider audience, achieve greater flexibility, and attain unprecedented business efficiency.
“According to Accenture’s Finance 2020, 85 percent of the CFOs mentioned their plans to increase their cloud investments, while one-third of them expect their investments in cloud-based solutions to increase by more than 25 percent in the next two years.”
Artificial Intelligence
AI is one of the most promising and futuristic branches of computer science technology. It builds modern machines and tools that aim to replicate human intelligence. Mostly powered by machine learning, artificial intelligence systems enable users to automatically perform jobs that require human intelligence and rational thinking.
Today, AI is growing rapidly, designing machines that execute complex tasks and mimic homo sapiens easily. Tasks such as text recognition, which were once considered innovative breakthroughs, are regarded as inherent computing tasks these days. AI has now forayed into much complex territory, bringing innovations like self-driving vehicles.
The impact of AI on the accounting and finance sector, just like every other industry across the business spectrum, has been extraordinary. Day after day, artificial intelligence is inventing novel applications that are making complex, data-intensive accounting tasks easier. Administrative tasks such as invoice capturing, data entry, and bank reconciliation can be automated with the help of AI, saving valuable time and effort which can be invested in other business-critical tasks.
“As per Mordor Intelligence, the global market for AI in accounting is expected to achieve a massive Compound Annual Growth Rate (CAGR) of about 30% from 2020 to 2025.”
The following are a few factors that drive the strong impact that AI has on accounting:
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Streamlined Data
Artificial Intelligence helps accountants and finance professionals record lengthy and tedious transactions. It also allows the extraction of data from finance receipts and automatic classification of that data on the basis of its spend category.
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Enforce Corporate Policies
It takes a great amount of time to identify the non-compliance issues in the financial data. AI helps to enforce the corporate policies by regularly scanning employee receipts, their travel bookings, credit card transactions, etcetera for identifying transactions that infringe corporate policies. It proves extremely beneficial at the time of auditing as error detection is quick.
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Minimized Risk of Fraud
The automatic auditing with AI helps accountants detect all sorts of irregularities in accounting data which further eliminates reimbursements of fraudulent spendings. AI also manages data influxes without disturbing the overall accuracy of the system.
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Predictive Analysis
AI-based tools help accounting firms analyze the market trends for accurately predicting future results. It eliminates the human biases from the data-intensive activities, making quick predictions to help organizations with revenue forecasting, cash flows, and expense planning, etcetera.
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AI-powered Chatbots
Accountants and finance professionals are often bombarded with common queries from customers, which in order to maintain the company reputation and achieve greater customer satisfaction, can’t be left unanswered. Thanks to AI-powered chatbots and virtual assistants, these types of regular customer queries can be taken care of efficiently. Making use of Natural Language Processing and Machine Learning, these chatbots offer near human-level experience.
Cloud Accounting
Cloud computing is one of the most exhilarating contemporary technologies, giving accountants access to all their typical accounting resources via the cloud. Cloud-based accounting applications such as QuickBooks help businesses do away with the obstacles of the traditional, on-site, physical accounting infrastructure. These applications record all sorts of financial transactions and help capture cash flows, generate account reports, and perform complex accounting calculations. These are some of the major driving factors behind the rapid adoption of cloud accounting tools and internet bookkeeping.
“ About 67 percent of accounting professionals prefer cloud-based accounting solutions over natively installed accounting programs, reports Flexi. It further mentions that the worldwide market for cloud accounting is expected to achieve a value of 4.25 billion USD by 2023 from the current 2.62 billion USD.”
Listed below are some of the other benefits that cloud accounting offers:
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24/7 Access
Cloud accounting proffers all-time resource availability which modern accountants use to their advantage. They have access to all their accounting assets in a few clicks, from any geographic location. The on the go access helps managers and decision-makers easily monitor their financial data and take timely decisions accordingly.
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Easy Scalability
The modern, competitive business setup doesn’t allow much time to organizations and hence, they have to be real quick in adapting to the ever-changing business needs. The cloud offers fast scalability options where accounting firms need to raise a mere request in order to scale their cloud resources up or down. This helps them meet their new data storage requirements quickly, without changing their local infrastructure by one tiny bit.
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Greater Cost-efficiency
Cloud computing offers inexpensive cloud storage and solutions that make cloud-based accounting more cost-efficient compared to the traditional, local computer-based accounting infrastructure. Accountants can avail all benefits of the cloud with a pay-as-you-go model of payment where they need to pay only for the resources used. There are other cost benefits that accounting firms and CPAs derive from cloud accounting. Zero IT maintenance and lesser power consumption being a couple of them.
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Enhanced Data Security
Security is one of the biggest concerns for organizations planning to adopt the latest technologies. Accountants deal with critical financial data that needs top-grade security and protection. With all the sophisticated security strategies, the cloud is considered to be more secure than customary physical data servers. It incorporates multiple security layers that involve strategies such as data encryption, multi-factor authentication, etcetera.
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Advanced Backup Capabilities
In addition to providing top-grade security, the cloud also offers effective backup strategies that help accountants recover their data easily. Direct public cloud backup, Backup-as-a-Service (BaaS), and Cloud-to-Cloud (C2C) backup are some of the widely used backup strategies.
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Easy File Sharing
Cloud accounting also enables CPAs to easily share accounting data with business partners and clients. A file can be simultaneously accessed by multiple users irrespective of their location. This eliminates the need to send a file back and forth via email for sharing data.
AI and Cloud Accounting – A Highly Effective Union
It has already been proved how beneficial both AI and cloud accounting individually are. Their collaboration further extends these benefits. Cloud accounting enables easy integration of Artificial Intelligence, while AI tools are configured to deliver efficient results in cloud-based accounting. AI-enabled cloud accounting helps accountants use technologies like big data and machine learning that provides great insight into important business data, helping decision-makers take timely and accurate decisions to achieve greater profitability.
AI and cloud complement each other in the following ways to deliver flexible, efficient services:
- Modern AI tools work with private and public clouds to monitor, manage, and even cure issues occurring in various processes.
- AI and the cloud together help achieve improved data management infrastructure that effectively identifies, ingests, catalogs, and overall manages the accounting data.
- AI-SaaS integration is helping accountants utilize dynamic cloud services. For example, an AI-powered dynamic pricing module makes sure the pricing of products and services are always optimized.
Considering all the discrete as well as combined benefits of Artificial Intelligence and cloud accounting, it is clear how much value they bring to an organization. In fact, it would be an understatement to merely say that AI and cloud are beneficial for an enterprise. They do bring great flexibility, efficiency, and profitability, but above all they make businesses futureproof with their innovative applications, and hence, they are the way forward.
