How AI technologies can transform accounting
Debra Feltham, FCPA likes to be technology-forward at her accounting practice. At Mount Pearl, N.L.-based Feltham & Associates, this means embracing cloud-based solutions and other efficiency-improving tech ever since launching her firm in 2005.
Today, such forward thinking means adopting different AI technologies, which are promulgating across industries—including the accounting sector. Using reporting and analysis software like Fathom, Qvinci and Syft or programs like Dext, which allows for AI recognition of receipts, allow firms of any size—even solo practitioners—to save time and optimize their work.
“It's very much embedded in every part of what I do,” she says. “And I think of it as a tool that's an extra pair of hands for me.” This comes in particularly handy at a firm like Feltham’s, which has only six employees at the moment.
With the AI revolution coming to workplaces across all industries, the lingering question is how it will shape each profession. In the past, CPAs have adopted other technologies to work more efficiently, but there’s some hesitance.
A 2023 survey by accounting cloud software firm Rightworks asked nearly 500 decision makers and influencers at accounting, tax and bookkeeping firms, uncovering that nearly three quarters said they weren’t using AI in their work.
But there is a change on the horizon coming from elsewhere in the business world. Nearly three quarters of companies surveyed by KPMG earlier this year are using or piloting AI in financial reporting. This is expected to rise to 99 per cent of companies in just three years.
Public accountants already have many ways to incorporate AI into their work. Generative AI, like ChatGPT which can help compose marketing copy or assist with communications; multimodal which can analyze text, numbers and graphics—like those found in annual reports; or embedded AI like the "copilots" which assist in a variety of software platforms. CPAs can use AI programs that assist with audits, create financial reports and quickly identify critical issues to discuss with clients.
To help make CPAs make sense of and navigate these emerging technologies, CPA Canada has partnered with the Association of International Certified Professional Accountants to produce educational materials on AI. This includes a webinar on use cases, governance and implementation which attracted record attendance this spring.
At the event, Melissa Robertson, CPA, Principal, Research & Thought Leadership (Technology) at CPA Canada advocated starting small. "Look inward, see what real problems within your organization you can actually solve with AI,” she said. Robertson added that going too big too fast and doing too much with AI will lead to failure. Firms should leverage the knowledge and the workforce they have as they explore the new technology.
CPA Canada also launched a paper on AI this year, with two others to follow on the topic in months to come.
PSAB hasn’t yet launched an AI-focused project, but chair Clyde MacLellan, FCPA, recognizes its importance. “But the power of AI for the public sector may lie more in how financial statement/financial information preparers can accelerate the reporting processes and be more responsive to a variety of interested and affected parties.”
Feltham uses Syft, for example, to create and analyze key performance indicator reports for clients quickly, and use the information to have strategic discussions.
Syft, which starts at $15 USD per month and other AI-based software programs have low enough prices that even solo practitioners and small firms can afford it, and unlock returns on investment. "It allows us the ability to do more for the client and provide better value," Feltham says.
Robertson said firms need to put policies in place as they integrate the tech, by first understanding how AI is being or may be used by CPAs. It’s also critical to ensure that they are not putting proprietary or sensitive information into programs which may share it.
Feltham says AI should not overtake manual review and that CPAs should use the new technology thoughtfully.
“We've always said every accountant needs to have professional judgment,” she says. CPAs need to educate themselves in how to use AI responsibly, but it’s also critical not to “not be afraid of what the technology can bring.”