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Charlotte Rogers

5 Myths About AI in Accounting



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The workplace is changing rapidly with technological breakthroughs, the rise of Artificial Intelligence (AI), and the increasing reliance on tech for tasks and data storage. It is easy to feel left behind. Accounting is one of the fields in which AI is changing the game. So, how can you leverage AI in your practice? With AI being new to the game many people have concerns about the effectiveness, or rather the over-effectiveness of the technology. And let’s face it, pop culture's portrayal of AI as a harbinger of world domination doesn't help. It's only fair that people are a little concerned.  This blog will address some of the most common myths about AI in accounting, clarify what’s true, and help you navigate the new landscape of AI-powered accounting.


Myth #1 AI will take the jobs of accountants


Many misconceptions about AI exist. One of the largest is that people are afraid that AI will take over jobs and put them out of work. Since AI was introduced into the workplace, people have been afraid of it taking over their jobs entirely. However, AI wasn’t created to replace humans, but rather be a tool to use in the workplace. Accountants have been using automated accounting systems to do the monotonous jobs that no one wants. Crunching numbers and sifting through endless data is something a human could do, but with the help of AI, these tasks are getting done quicker and more efficiently, leaving the experts to focus on more creative and complex tasks. 


Rather than being afraid of the advancing technology of AI, consider it as a tool to help your team get things done more efficiently.  Financial roles are unlikely to be entirely replaced by AI because they require a "human touch"—the kind of empathy, judgment, and creative problem-solving that a robot simply can't replicate. As an article on Ocrolus put it, “AI is designed to enhance human capabilities, not replace them.” While AI can learn and improve its capabilities over time, it lacks the common sense, creativity, and interpersonal skills that human accountants bring to the table.


Finally, there's a misconception that AI is as "smart" as humans. While AI can process vast amounts of data and learn from many different sources, it lacks the innate understanding and imagination that humans possess. Accounting isn’t just about numbers and regulations; it involves understanding unique client situations and developing personalized solutions—skills that only human experts have. As Jason Staats said, “AI isn’t going to replace accountants but accountants who use AI will.” 


Myth #2 Using AI in accounting is expensive. 




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Contrary to popular belief, incorporating AI into accounting doesn’t have to break the bank. Since AI became mainstream, it has become even more accessible to small businesses and entrepreneurs as well as large corporations. In the past, automated accounting was expensive and only large corporations could afford to use it. Now, however, there are endless options of AI-automated accounting software to pick from based on your needs and budget.


The first thing to do is to research. Figure out what you need from AI and then look for software that provides that service. Some tools have an initial cost or ongoing maintenance fees. Decide if the cost is worth it for you. Most of the time, integrating AI into your workflow streamlines processes, saves time, reduces errors, and ultimately saves money. Studies have shown that "AI in accounting can lower operational costs by up to 25%." Some popular software options to explore include Karbon, Hubdoc, Xero, and Float. Remember, AI tools can be mixed, matched, and customized to fit your specific needs.


Myth #3 AI is slow and complicated.

One of the greatest advantages of AI in accounting is its ability to turn hours-long tasks into minutes-long ones, often with greater accuracy. Research found that “AI can reduce the time it takes to close financial books by up to 80%.” and that “AI can analyze financial data 1,000 times faster than a human.” While AI isn’t perfect (since it derives its information from human sources, which can be flawed), it remains far more efficient than manual methods for many routine tasks. 


Most modern AI-based accounting systems are designed to be user-friendly, even for those with little to no tech experience. However, getting used to automated systems does take some adjustment. It can be difficult when you have no understanding of the business context or how the AI algorithm gathers information. The best way to become comfortable using AI is to jump in and start using it. Do your research so you can find what AI software would be the most beneficial to your needs, and explore YouTube or Google tutorials if you are struggling. Learning how to use AI pays off in the end by streamlining the process of your time-consuming tasks and allowing you to work on other things. 


Myth #4 There is no need to change the way we do things.


People have argued that there is no need to change the current systems in accounting because the traditional methods work just fine. However, this is a short-sighted approach in a rapidly evolving technological landscape. The world of accounting (and for that matter, the entire workforce) is changing with the development and improvement of technology. Not adapting your current methods with new technology may lead to your business falling behind your competition. The goal isn't to abandon tried-and-true methods altogether, but to strike a balance that integrates both traditional practices and innovative AI technology.


 People don’t like change, it's true, but to stay above the competition means improving with new technology. A smart and progress-driven approach seems to be a balance of AI and human work. People have argued that AI isn’t developed enough to use productively in the workplace. However, companies like Netflix and Amazon already use AI with their algorithm to personalize customer experiences, showing that AI is more than capable of delivering value in the business world.


Myth #5 AI compromises customer privacy

Another common concern is that AI might compromise customer privacy, especially since it often uses Personally Identifiable Information (PII) to function. It’s assumed that this information is easily leaked because of AI’s data-gathering processes, but this is nothing to be concerned about. Financial technology is programmed with the highest privacy and security.  Automated accounting is no regular AI; it is designed with customer privacy in mind, and nothing but the highest caution is used when handling customer information. The automated document classification technology is designed to gather the most important information and delete the rest.


In essence, the same level of care and confidentiality that a human accountant provides is embedded into AI-driven systems. The misconception that AI doesn’t value privacy is simply unfounded—advanced AI accounting systems prioritize client confidentiality and employ robust encryption and security protocols to ensure it.


Conclusion


AI is not a threat to accounting; it's an opportunity. By debunking these common myths, it's clear that AI has the potential to revolutionize accounting in a way that complements, rather than competes with, human expertise. As technology advances, the key is to leverage AI as a tool that enhances our capabilities, allowing accounting professionals to focus on what they do best—solving complex problems and delivering personalized client service.




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