Artificial intelligence (AI) has begun to infiltrate all aspects of our lives, from ordering food to controlling our homes. But there's one area where AI has yet to make a significant impact: accounting. The path of AI Accountants is littered with phonies - offshored labor pretending to be robots. Despite what you may have heard, AI accounting is not a realistic replacement for human accountants. Here's why.
First, AI accounting software is not yet sophisticated enough to handle all of the complexities of real-world accounting. AI software can't always correctly identify and categorize transactions - it simply does not have the capability to understand the vast possibilities of what the transaction was used for. For example, a company transacts outside labor for the development of their office software: would the AI know to capitalize the cost, or would it take it as an outside labor expense? In order for the AI software to figure this out, it would require the capacity to communicate with the various stakeholders in the business. This is something that AI software cannot do.
Second, even if AI accounting software was able to accurately categorize transactions, it would still lack the ability to provide the critical insights that human accountants can. Accountants use their knowledge of accounting principles and their understanding of a company's business to provide valuable insights into a company's financial situation. For example, an accountant might notice that a company has been increasing its inventory levels rapidly, which could be a sign that the company is having cash flow problems. AI software would not be able to provide this type of insight - it would only be able to report on the data it has been given.
Third, and perhaps most importantly, AI accounting software would not be able to provide the same level of customer service that human accountants can. When you work with an accountant, you are working with a professional who understands your business and is there to help you grow it. AI software would not be able to provide this level of service - it would simply be a tool for inputting and outputting data.
Some of the most notable self-described "RoboAccountants" has been exposed on the web, the "robots" turned out to be low-cost labor in another country. AI Accounting companies, as with the majority of Silicon Valley startups, operate at negative cash-flows funded by investor rounds. The moment they are unable to fundraise, your business will suddenly have to find a new service provider.
AI accounting software is not yet ready to replace human accountants. It may one day be able to provide some valuable insights, but it will never be able to provide the same level of service or understanding that human accountants can. For now, if you need an accountant, you're better off working with a human. GFT is an accounting outsource service that can provide you with the accounting services you need, without the facade of AI software. Contact us today to learn more.