Accountancy (+) AI (+) tech = AI accounting software.
The way that accountants interact with technology is changing. According to a BBC article earlier this year entitled ‘Could AI take the grind out of accountancy?’, a new generation of accountants is using AI right from the beginning of their careers.
Becoming AI-literate is no longer a boon for accountants – it’s a must-have. Accountants of all ages and experience levels must acclimate to specialised AI-powered accounting tools – pronto. As the developers of AI-powered accounting tech, we’ve broken down AI accounting software into three key, digestible insights.
Here are two key reasons why AI-powered accounting software is designed to improve on the limitations of traditional accounting software.
Natural Language Processing (NLP) is a subset of AI that comprehends natural language as it’s spoken and written. In other words, it understands the meaning of words – compared to traditional technologies that only recognise the surface structure. Traditional accountancy technologies (such as older versions of) QuickBooks, Sage and Microsoft Excel, do not incorporate NLP and, therefore, often require manual intervention to verify and manipulate data.
A typical application of NLP in accountancy technologies includes AI-powered expense management software. These tools use NLP to determine the appropriate category (such as travel, utilities, subscriptions, etc.) for expenses based on the description, vendor and other contextual cues.
Because AI lacks manual touchpoints, scaling AI-powered accountancy technologies won’t necessitate more human resources. For example, if you manually enter data from accountancy documents (e.g. invoices), an increased volume of documents will mean more time spent on those documents. However, automating this process requires no extra time if the document volume increases drastically.
When serious, payroll errors can take hours to resolve – time that many accountants simply can’t spare. AI accounting software offers several solutions for manual bottlenecks. Let’s explore a few of them.
Shave minutes off copying and pasting key info (e.g. from timekeeping systems) by automating data entry. In this context, where complete accuracy is necessary, you might consider a managed service where a trained annotator can validate your data’s accuracy.
Interesting work is happening in the automated tax filing space. Our CEO used to work for a company aiming to automate tax filings but found that traditional data entry technology systems failed to extract information from tax documents. The missing ingredient? AI. Now, it looks like automating tax filings with AI is a very real possibility.
Daily accountancy operations and admin can take time from accountants performing higher-level analysis. Financial analysis can be manually time-consuming but helpful in uncovering financial health. AI is now becoming extremely effective at calculating key financial ratios, quickly.
The future of AI-powered accounting software might manifest as more reliable, offering high-performing financial analysis and improved security.
Some accounting software offers ‘chatbot’ features, where you can ask questions about the accounting data. Such features are powered by Large Language Models (LLMs) that are often flawed (generating hallucinations or requiring several attempts to generate the desired information).
In the future, as these LLMs improve, accounting software will likely generate insights for analysts to factor into their decision-making. For example, you might expect the AI to be able to ingest large amounts of data and supply revenue forecasting, industry insights or analyses of financial health.
Earlier in the article, we noted that 77% of global businesses are pursuing the use of AI. Interestingly enough, Indusface reveals that 91% of organisations feel they are not ready to manage the risks posed by AI.
These figures may reveal concerns over safe deployment, potentially preventing businesses from wholeheartedly embracing AI. For accountancy as a sector – governed by regulations and having a rich culture of set cultural practices – it might be tempting to shy away from testing AI-powered accounting software.
While concerns about AI security are valid, particularly in light of recent incidents like OpenAI's data breach, it's important to recognise that AI literacy is also on the rise. As AI users educate themselves about using AI responsibly (such as by reading articles like this!), they will be able to consciously mitigate the risks that AI poses to sensitive financial data.
On the other end, AI vendors have a vested interest in developing the most robust security practices. For example, OpenAI's recently announced a $1 million initiative to enhance AI-powered cybersecurity. In an AI landscape where commercial LLMs are closely competing, no company wants to be known as the one with suspect security controls.
Ultimately, the potential benefits of AI-powered accounting software, such as improved efficiency and accuracy, outweigh the risks, especially when used responsibly and with appropriate safeguards.
With AI’s capabilities surging forward, it can be easy to feel adrift when considering AI-powered accounting software. The best way to stay ahead of the curve is to work alongside AI vendors who can improve their technology and have a plan for continuous improvement. Check reviews, watch demo videos and consider investing time in a Proof of Concept (PoC).
Financial Statements AI is our AI-powered solution for accountants and anyone dealing with financial statements regularly.
Instead of just extracting the raw data from financial statements, Financial Statements AI computes it. It parses the financial data accurately, leveraging it to process key ratios such as OPEX, EBITDA, Gross Profit, and more.
We built Financial Statements AI for maximum convenience, alleviating the administrative burden that haunts many accountants. Leave extracting and processing data from financials behind in 2025.
Of course, you don’t need to take our word for it. Book a demo or email hello@evolution.ai to try Financial Statements AI for free.
