Will AI eat my accounting practice?

Adam Turner

The article is relevant to members in Australia and New Zealand and was current at the time of publication.

Tools like Microsoft Excel allowed accountants to spend less time adding up numbers and more time interpreting the results. As accountants became more valuable to businesses, their numbers increased rather than dwindled.

As with Excel, accounting firms that ignore AI will struggle to compete. Once again, this does not mean human accountants have become redundant, says Jason Robinson, FCPA and Director of financial advisory and accounting services provider Future Advisory.

Human empathy, insight and intuition will become more valuable as AI and automation take over routine work, meaning that junior accountants must focus on developing those human skills, Robinson says.

“Accounting practices using AI will eat those practices that aren’t using AI, but this means juniors who aren’t starting out on compliance work need to be fast-tracked into learning the advisory and consulting skills that will be critical for accountants going forward,” he says.

“Experienced advisors must actively mentor juniors to develop client-facing confidence and strategic thinking, so juniors can engage earlier in client advisory roles.”

Role of accounting juniors

Accounting firms expecting juniors to pay their dues performing compliance work will struggle to attract the best talent, as technology-savvy graduates enter the workforce ready and eager to do much more.

“Today’s juniors are smart, creative problem solvers who are already using tools like AI,” Robinson says. 

“They won’t be content to shuffle paperwork and crunch numbers for a few years when they should be learning how to talk to clients.”

“In the age of AI, clients will value the human connection more than ever, relying on nuanced understanding to underpin advisory services like growth and planning.”

As with previous technological upheavals, it is important for accounting firms to recognise that AI is a tool, not just a threat. Along with offering accounting firms the opportunity to build better client service models, AI also offers them the opportunity to attract a wider pool of young talent, say Tyler Wise, FCPA and Partner, Accounting & Business Advisory with financial advisory and accounting services provider Findex.

“The accounting industry has a challenging pipeline for talent, because there’s a stereotype that working with numbers is mundane and dry,” Wise says.

“In truth, accounting can be dynamic and exciting, and delegating the more mundane aspects of accounting to AI helps sell that vision to the next generation of talent.”

Just like an ambitious junior accountant, AI is working its way up the corporate ladder to handle more senior tasks like analysis and forecasting, Wise says.

“Juniors might take the initial brunt, but accounting firms need to recognise that AI is also set to reshape senior roles,” he says.

“This is why they require a balanced approach to AI that is quick to learn but deliberate in implementation. If they don’t understand the threats and opportunity, it will sneak up on them.”

In a traditionally conservative industry, it is tempting for smaller accounting firms to stick with their old ways and leave new technology to the big end of town, but they cannot afford to be complacent, says Sarah Lawrance, FCPA and Founder and CEO of outsourced accounting and bookkeeping services provider Hot Toast.

“I don’t say this to scare people, but every accounting firm needs a disruptive mindset that looks ahead, asking what their business model would look like if their compliance work disappeared tomorrow,” Lawrance says.

Delegating the compliance workload to AI frees up accountants to focus on higher-value tasks, but AI still requires human oversight to ensure quality assurance and accountability — a role likely to be played by juniors.

Junior accountants tasked with overseeing AI compliance work will benefit from earlier audit experience to nurture their critical thinking skills, Lawrance says.

“I started in audit, which lets you look at things from a different perspective while developing curious and critical thinking,” she says. “The ability to stress test numbers and identify anomalies better equips juniors for overseeing AI’s compliance work.”

“At the same time, those critical thinking skills are also preparing juniors to sit in front of clients with a true understanding of the integrity of the data.”

Don’t forget safeguards

Even with humans in the loop, AI safeguards are required to ensure people remain the final decision-makers and bear responsibility for protecting clients and preserving professional standards.

Accounting firms require AI Governance and Risk Management guardrails to enforce policies around data handling, privacy, security and accountability. Lawrance says this means AI adoption must begin with strategy, policies and procedures, rather than technology.

“It’s easy to jump headfirst into letting your people use AI, but first accounting firms require oversight and internal controls over which AI services are used, which tasks they are entrusted with and what data they can access,” she says.

“You also need to take your clients on the journey, which requires transparency and accountability when it comes to how the people in your accounting firm use AI.”