Artificial Intelligence has made a significant impact in the world of finance and accounting. In fact, AI-enabled finance and accounting systems are the way for enterprises to stay strong contenders in an increasingly competitive market because they save time and provide deep insights.
The two major reasons for the rapid growth of AI in Industry 4.0 are the exponential growth of data generated by the Internet and IoT devices and the computation of this data.
New technology is shaping Industry 4.0 in every vertical with intelligent responses to changing expectations of customers, suppliers, vendors, and partners. Automation enables a reduction of 80-90% of the time previously taken by the workforce in performing disparate and repetitive tasks manually. It also enhances the quality of the output by reducing human error.
Almost all accounting tasks, including payroll, tax, banking, and audits, have become automated with AI, disrupting the accounting industry, and bringing about a big change in how business is done.
Robotic Process Automation (RPA) can complete repetitive tasks in the enterprise's business processes with amazing efficiency, including document or data analysis. With RPA in place, the finance team can break free of getting bogged down by non-value-added tasks. Instead, they can focus more on taking up strategic and advisory responsibilities.
Let’s look at a few applications of RPA and Intelligent Automation in accounting:
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Enterprises that jump on the digital transformation train by adopting AI have the advantage as they can leverage AI to all aspects of accounting, including improved operational efficiency, reduced costs, and more significant ROI. For instance:
Payables/ Receivables Processing
Invoice processing is considered one of the more time-consuming and labor-intensive parts of the enterprise. AI-based invoice management systems help by increasing the volume, performing zero-error processing, and improving vendor relationships.
The AI-based approach helps expand customers' reach, increase revenue, and evaluate the suppliers with minimal human intervention.
Purchasing and procurement processes mean a lot of paperwork - sometimes in different systems that are seemingly unconnected! With AI-driven workflows, finance teams can process unstructured data while automatically mitigating governance/compliance/risks.
Data analytics establishes the scope of the audit, and risk assessment as RPA and analytics facilitate tracking of routine transactions. Cognitive computing, predictive analytics, and AI enable tracking more complex transactions that go with estimates and judgments.
Monthly and Quarterly Cash Flows
AI-based tools empower enterprises to reconcile financial activities quickly, understand historical cash flows, and predict future cash requirements. AI applications also ensure that all financial processes are secure by collecting data from many sources and integrating the data.
When manually done, managing expenses-related processes is not only filled with complex paperwork - but also prone to fraud and data breaches. Expenses management automation ensures almost zero errors and alerts the team to a breach if it occurs.
AI-driven chatbots help solve user queries quickly and efficiently, including queries on account balance, financial statements, account status, etc. Tracking outstanding invoices and automating the follow-up collection processes with AI ensures that accounts are kept balanced and closed promptly. Moreover, AI chatbots answer customers' routine questions and can provide level-1 support.
Adopting AI and automation tools into an enterprise can come with a few challenges, but none that can’t be overcome.
No doubt, the stakeholders of an enterprise have recognized the value of adopting AI-powered systems and applications. However, it also requires a shift in the mindset of more than the CFOs. The finance and accounting professionals need to make the shift and equip themselves with the necessary skills and knowledge.
The finance teams must appreciate that they are now free to contribute to new business relationships, improve existing partnerships, and work from a position of strength, thanks largely to AI and the resulting critical insights.
Enterprises must not only invest in technology but also the workforce required to handle said technology. It means that they must also provide proper training and support for the teams to use AI to optimize productivity efficiently.
As advanced technology evolves, it will only become more sophisticated, with more tools and systems becoming available to finance and accounting. The rapid expansion into digital transformation with AI and automation sets the pace for quick learning and the adoption of new ways of time and cost-cutting.
Finally, finance and accounting teams adopting AI to their practice will be better able to analyze a tremendous amount of data, identify patterns and trends. Even better, they will be able to use the latest technology and tools to support various working modes and geographies by taking over routine tasks that are better suited to machines.
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