Can AI Replace Your Accountant?

By Praneeta Ranchhod | 24 February 2023 |

Read Time: 3 Minutes

AI Image of robot being an accountant — caption for image

When I worked in corporate, I would get told that my job would be obsolete in a few year’s time as AI was going to replace me. Well, it’s a few years later and I am still here.

Now, technology is evolving rapidly. You may have heard of ChatGPT, the technology that’s sparking conversations about which industries it will replace in the future. Accountants and marketers are among those on the chopping block.

But is it likely that AI will replace accountants?

As an accountant, I researched this topic and found that while AI can automate certain tasks, it cannot replace human accountants entirely. Accountants do more than generate data; they also analyse and interpret it, which requires human judgment and expertise.

The impact of technology on the finance function can have a significant effect on a business’s competitiveness. Business owners will need to invest in suitable software and outsourced accounting services to automate routine tasks, allowing them to focus on core business tasks.

AI will assist accountants with complex tasks such as fraud detection and financial analysis, providing insights and recommendations to improve financial performance and reduce costs.

Business owners will need to seek out accountants that use AI to obtain more efficient service and lower costs.

Accountants who use AI will replace those who don’t, but critical thinking skills, problem-solving, and communication cannot be replicated by AI.

Accountants and AI will work together to add more value to business owners in the foreseeable future, and business owners will need to understand the value of AI and incorporate it into their businesses.

Are there AI tools available that I can ask Accounting questions?

Over the weekend, I discovered that someone used the Chat GPT API to create an accounting chat bot which you can subscribe to for $6 (R110) a month. That’s a massive saving on your accounting costs!

(This is an American tool so it might not be relevant for South African Companies as we use IFRS to prepare our financials. The US uses US GAAP. Also obviously the compliance environment is different – the example is just used to explain the concept)

With this chat bot, the claim is that it can ask it any questions 24/7 and it will answer.. I highly doubt that any accountant will respond at 3am.

So in this case: AI 1- Accountants 0.

I conducted a simple experiment to test Chat GPT’s accounting knowledge. I fed it a simple scenario and asked it for an income statement.

This is the first scenario:

In this scenario, I left out the breakdown of what Suzy spent the R2 450 on as well as the useful life of the lemonade machine.

In this case, Chat did not ask further questions and provided me with a solution based on the information I had fed it:

It made assumptions (which it did not disclose) around the cost of goods sold and the advertising and completely ignores the depreciation of the lemonade machine, thus resulting in the incorrect net income of R1 400.

Once I corrected the input, it gave me the correct answer, although not in a multi-step income statement, but rather in a single-step income statement. I probably had to be more specific on what format I require:

AI Chat gpt correct answer — caption for image

In conclusion, the solution you receive will only be as accurate as the input you feed it. And to assess the accuracy of the solution, who will you ask? An accountant!

The technology is still new and is constantly learning and evolving. In the future it will likely be more sophisticated and will probably give the correct answer.

But as Business Owners you will still need an Accountant to oversee the results.

So, it seems accountants are not going anywhere soon!

Finally, if you’re still dreaming of replacing your annoying accountant with a bot, instead of just finding another one, I’ll leave you with this: who will you blame when your bot gives you bad advice?