AI technology is everywhere, so subsequently it will also start infiltrating areas such as accounting solutions. Which is a perfect area for AI to work well in, due to its data and numbers nature. Sure, not every AI feature already works as we are promised and like in every business area, there is lots of AI-washing happening. But AI technology excelerates so quickly, that it's only a matter of time until accounting software solutions will provide the perfect service they promise. We took a critical look at AI in accounting and let you know what works already and what requires some fine tuning.
In theory these should be the key AI capabilities and strengths for accounting and our assessment of the status quo:
\- Predictive Analytics: AI algorithms analyze historical financial data to forecast future trends, cash flows, and potential risks. This improves financial planning and allows a more strategic approach. Our verdict: Although the tools could be capable of making solid predictions, they also need a large enough data set to make them. So in practice the ball is in the court of the business owner for this to work. When enough data is available, this allows businesses to make better decisions and take a glimpse into their financial future.
\- Pattern Recognition: AI is good at identifying patterns and anomalies in large datasets, which helps fraud detection and can uncover financial errors. Our verdict: Works quite well in most cases already, and if it doesn't it's mostly due to a lack of AI understanding context.
\- Automation of Routine Tasks: AI automates routine tasks that take up a lot time, such as data entry or invoicing. Our verdict: AI does a flawless job in this area already.
\- Intelligent Data Visualization: AI accounting tools offer advanced data visualizations, which make complex financial information easier to understand for non-accountants. Our verdict: To be honest we were not able to put this to the test yet, but QuickBooks and Xero offer this feature.
