new study Stanford University and MIT shed light on whether adopting artificial intelligence (AI) is valuable to accountants in small to medium sized companies. Simple answer: Yes.
In a survey of 277 accountants and original data from 79 small and medium-sized businesses, researchers have discovered that GEN AI can make users more productive and finish tasks faster. Used to meet clients.
But there is also fear. The biggest concerns are accuracy, data security, and unemployment if AI ends up replacing accountants.
Most impressive findings: Accountants using AI processed 55% more clients per week than those who didn't use it. It also reduced 8.5 percentage points on data entry and transaction coding tasks, saving 3.5 hours a week.
Signs that did not use extra time for idle activities also recorded 21% billable times. This shows that they were engaged in activities that boost revenue.
In reality, this meant that accountants could spend more time advising clients, addressing complex issues and reviewing their work for accuracy.
“AI strengthens accountants' capabilities by taking over low-level tasks and allowing them to concentrate more on their advisory and analytics work,” the author writes.
According to PYMNTS Intelligence ReportCFOs are confident in using AI to optimize their financial processes. Accounts receivable is a particularly promising target for AI investments, with 55% of middle market companies' CFOs willing to spend on solutions that automate invoice approval and payment.
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Faster, more detailed reporting
In this study, the authors used GEN AI for low-level accounting tasks such as data entry, transaction classification, and preliminary information processing. They used software provided by AI accounting firms that allowed the system to “understand” receipts, invoices, bank statements and other similar inputs.
The benefits of technology have expanded beyond time savings. The adoption of AI has resulted in a richer and more beneficial financial statements, in relation to a 12% increase in the granularity of the general ledger (the number of unique accounts used to classify transactions).
We've also speeded up the reporting cycle. On average, accountants using AI closed their monthly books 7.5 days faster than non-users. They complete their monthly financial statements within two weeks of the end of the month, but non-users take at least a week longer. For many small businesses, that speed could mean previous detection of cash flow issues, faster tax preparation, and more timely reporting to investors and lenders.
Research shows that these improvements did not undermine the quality of the work. In fact, the data suggests quality has improved.
Human surveillance is essential to making AI effective for accounting.
The AI systems used by partner companies provided a “trust score” and showed how certain it was about transaction classification. Experienced accountants were more likely to intervene when the confidence score was low to catch potential errors. In contrast, inexperienced accountants may accept AI output even when the system is uncertain, allowing mistakes to slip through.
The author concluded that “AI expands human judgment, not replaces it.”
read more:
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