Impact of Artificial Intelligence, Machine Learning, Adaptive Intelligence, Robotics and Edge Computing on Financial Accounting
Exponential Technologies are bringing about digital transformation in Finance and Accounting. Primarily Artificial Intelligence, Machine Learning, Adaptive Intelligence, Robotics and Edge Computing are enhancing output, speeding up computing, providing better accuracy levels with data security as well as creating new opportunities for human resources.
We are living in the perfect era in which practically every industry has been touched by the magical spell of Exponential Technologies. Businesses of small and medium-size to large enterprises are adopting technologies and striving to accelerate business processes, the catalyst being the capabilities of technical models. Right from storing data, to accessing, processing and saving data securely, technology takes care of every aspect. Just to recapitulate, in one of my previous articles, I covered the acceleration of Sales through Technology and now I would showcase the wonderful outcome of the conglomeration of Financial Accounting and Technology.
It is normal for human resources across industries to fear job displacement due to technological advancement; machine and adaptive intelligence taking over human intelligence. Finance and accounting professionals are no exceptions. However, the reality is completely different because when machines take over operational, time-consuming and iterative tasks, it will free human financial accounting professionals to do a higher level of more complex analysis resulting in value-added counseling for their clients as well as lucrative business for the organization. Let’s take a glimpse of the few opportunities that are now available by the grace of digital transformation of financial accounting.
We can see machines complementing human brain power. In many financial accounting consulting firms, automation, minibots, machine learning and adaptive intelligence are becoming an integral part of the team at a fast pace. As machine learning (ML) and artificial intelligence (AI) applications continue to increase and impact financial accounting responsibilities, the human resources have the promising opportunity too. They can not only focus on intellectual stuff, they are already getting more productive and proficient. They are able to handle more clients and deliver more value-added services because they can derive actionable insight rather than just play with numbers. Implementation of Adaptive and Machine Intelligence powered by strong algorithms are proving to be excellent propellers for innovation in this industry.
CFOs and Accountants are encouraging staff to leave bank reconciliations to a machine and focus on improving knowledge to develop new skills. In the near future, even though artificial intelligence and robots are sure to become an accounting professional’s most valued working partner, there is nothing that can replace the emotional intelligence humans bring to the job.
However, the speed with which technology is penetrating, not only will machines free up humans to take up other important tasks, automating accounting processes will help improve operations, prevent human-injected errors and reduce costs. Since automation will ultimately infiltrate most divisions in a company, financial accounting leaders who embrace the change are gaining expertise that will make them extremely valuable in future business process transformations.
Here are the few scenarios in financial accounting where disruption and benefits of emerging technologies are evident, which is, in turn, impacting other industrial ecosystems:
Invoice Processing: Invoice management systems are using artificial intelligence to make invoice processing much more streamlined with the help of digital workflows that are implemented. The workflows are built so as to learn the accounting codes that are appropriate for each invoice.
Supply Chain Management: Robotics and artificial intelligence are being used to vet new suppliers or vendors by checking their credit scores or tax information. The entities are created and added in the system, even portals are queried to get all the necessary information, without any human intervention.
Procurement and Purchase Management: The procurement and purchasing processes for most organizations involve plenty of operational overhead, using different systems and files that are usually incompatible with one another. As machines through APIs are able to be integrated and the unstructured data is processed, the procurement system will eventually become free of operational overhead. Robots are doing a splendid job of tracking price changes among a number of suppliers.
Financial Audits: Digitization of the audit process is helping in increasing its security by allowing a digital trail of when and by whom each file is accessed. Instead of searching file cabinets for the documentation that is required during an audit, auditors are now able to leverage the digital files. A more digital automated audit improves the efficiency and accuracy levels, providing cent percent coverage.
Closure Process: For any business, numbers matter the most and the faster you can get the numbers, the more time your organization gets to think strategically about what to do with the numbers. Artificial and adaptive intelligence are being used by robots to post data from a number of sources, consolidate and reconcile it. This is speeding up the monthly/quarterly closure process with accurate results.
Expenditure Management: Reviewing and approving expenses to ensure they are compliant with your organization’s policies is time-consuming for accounts team. Machine Intelligence is being used to read receipts, audit expenses and alert humans when a possible deviation is traced.
Customer Service: AI Chatbots and voice assistants are used to efficiently solve common questions or queries from customers including the latest account balances, when certain bills, EMIs or premiums are due, the status on cheques, accounts and more.
Edge Computing: This is the latest of exponential technologies that is generating energy to empower industries. In brief, edge computing means placing a computer near routers and gateways between the cloud and an end user of an electronic device, which could be a PC, a car, a television or something else connected to the Internet of Things (IoT). This setup is supposed to reduce communication lag times, cut bandwidth and help keep data private and highly secure by doing more computations locally. This approach differs from direct links to remote cloud storage that are more common now. Cloud infrastructure is now under strain to handle vast amounts of data that are being produced in real time and within this context, edge computing emerged. Financial Accounting would be a prime candidate for edge computing.
The key to the digital transformation of financial accounting is clubbing people and technology together allowing each one to contribute to areas they are best skilled at. Emerging technologies can efficiently and accurately analyze a tremendous volume of data, they can identify patterns in the data and learn how to treat various kinds of data. With robots taking care of the tedious, repetitive and monotonous tasks, human financial accounting professionals will be getting ample time to take up job responsibilities they are better skilled for, thus deriving job contentment as well as providing improved services.