Machine learning and accounting: What you need to know
Trent McLaren says machine learning presents an opportunity to the accounting profession today, tomorrow and in the future, but it requires an open mind.
It's been said that machine learning and artificial intelligence will transform the accounting profession unlike anything we've ever seen. If you're still wrapping yourself around cloud accounting software, just wait until you get a glimpse of machine power.
A look to the future
Envision a world in which your clients collect, tag and record all transactions into their accounting solution automatically using a smartphone, website or POS system.
A system that communicates with clients, chases documents and alerts the accountant of overdue work already exists. Right now, interconnect systems shares data between one another, with the adviser in the middle analysing and reviewing the quality of data coming into the central system.
Imagine a machine that could…
But imagine if the accounting system could learn how the accountant operates, and how clients operate:
The system could code transactions based on your prior history with 100% accuracy, then automatically reconcile transactions, and find their match and source document.
What if the machine could find all the errors created by your client, and automatically corrects and posts to the correct account.
And the machine could then start to review your client and their clients to determine buying behaviour, the late payers v the good payers, options for cashflow lending based on your receivables data, and check with the bank or financial institution how much money could be borrowed and when you'll expect to pay it back.
How about a machine that can predict your cashflow forecasting and then alerts the accountant, ensuring smart decisions now, despite these things aren't likely to occur for three months. Not only would the accountant be better prepared but they will be able to make better decisions based on machine recommendation, on a future it's predicted, your history, and your customer data.
The machine could analyse and compare your business against other businesses in your area, province, country and then create a benchmarking report on where you succeed and where you need improvements.
All this is just the beginning, my friends, of machine learning and artificial intelligence.
How can accountants use machine learning
There's a lot of doom and gloom associated with these advancements to accounting technology. But machine learning and artificial intelligence will provide accounting firms with the same value cloud accounting does.
It will be different at first, and some may not enjoy it, understand it and will likely be sceptical because this is the technology set to challenge the profession. After all, nobody wants to think a machine can do their job.
As this technology becomes available it's important to understand how it can enhance what accountants do and how to best allocate team resources as a result. The accounting world is evolving and it's about to incorporate a new kind of employee: the machine kind.
So don’t think how you alone can use it, but how your whole team can use it.
If this was available tomorrow, what plans and processes will you need to have in place? Start thinking about how you prepare for the next wave of technology and write this into your two-five year plan
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Winner - AccountantDaily Thought Leader Of The Year for 2017
I lead a team of spirited people looking to make a difference in the accounting industry as we know it. Elimination of debtors, automated invoicing and the thought of never having to touch your firm's billing again is a reality we deliver to accounting...