Incorporating Artificial Intelligence In Accounting and Auditing
AI (Artificial Intelligence) is the technological counterpart of “Human Intelligence.” To put it simply, it is allowing automated computer-based systems to execute tasks that otherwise involve human intelligence. These may include organizing company data, sorting information, sorting invoices, scanning cash flow to detect frauds or discrepancies, finance (accounting and auditing) and more. Nowadays, artificial intelligence is successfully being used to perform repetitive tasks in several industries and businesses.
The scope of work of accountants and auditors is like a rollercoaster ride. One day might be monotonous and mundane and may involve simply entering data, organizing company information, handling petty cash, or managing sales. On another day, it might be the exact opposite. It might involve complex processes and demand great attention, such as handling all corporate money transactions, detect possible fraud in accounts, get insight into overall business performance, and design business strategy.
Like other fields and industries, Artificial Intelligence has great potential in accounting and auditing. These will be discussed in detail and how AI can be incorporated in various aspects of accounting.
Data Entry
Accountants have the important responsibility of entering data of all types, which is analyzed later for a number of purposes. While this is an important task, it can be repetitive and droning, not to mention chances of human error. In addition, it tends to consume quite a lot of time. AI can perform this task with 100% efficiency with minimal chances of error. Purchasing, handling invoices, organizing payable and receivable amounts, and orders, can all be handled by AI for seamless and quick results.
Transactions and Cash Flow
Particularly in the retail sector, AI has many uses. By incorporating AI and machine learning systems, retail brands and outlets can effortlessly organize their sales receipts and other documents. AI systems can sort and organize scanned receipts and invoices, create a detailed database of customers and vendors based on available invoices and sort transactions into relevant categories.
Prevention of Fraud
Fraud and discrepancies, particularly in the banking and finance sector, pose a threat. With large amounts of money to deal with every day, the chances are that a suspicious activity might slip from observation. Among many other tasks to complete, constant scrutiny of transactions is a task accountant cannot err. Machine systems can effortlessly go through data files and identify suspicious or fraudulent activity that can be reviewed by auditors and acted upon.
Business Insight
AI can also help with providing a detailed analysis of the business. It provides valuable information about financial matters and delivers daily or even yearly reports. What is even better is that detailed financial reports can be available with one click. This allows companies to get insight into the current statistics of business and plan ahead for the prosperity of their company by avoiding potential risks and addressing issues. Accountants can greatly benefit from this technology as it will not only organize data but can also relieve accountants of some work so they can focus on more complex issues such as developing business strategies and analysis.
Conclusion
There is a prevalent fear that AI might insidiously invade the entire field of accounts and render human intervention unnecessary. There is little to no truth to this idea. Even with AI performing everyday tasks, human analysis is still crucial for the smooth functioning of any business or industry. Artificial Intelligence should be seen as a support and not as a potential competitor. Together, both human and technological intelligence can pave the way for a secure, successful, and sustainable business.
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