For years, business pundits have predicted the demise of the accounting profession as technology replaces work traditionally performed by the industry.

accounting

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For years, business pundits have predicted the demise of the accounting profession as technology replaces work traditionally performed by the industry. According to The Hackett Group, since 2004 the median number of full-time employees in the finance department at large companies has declined 40 percent, to about 71 people for every $1 billion of revenue.

The CPA profession acknowledges that the accounting skill set is changing, but the need for specialists in financial reporting, auditing, tax, and advisory services remains strong. For example, Wolters Kluwer N.V. uses Oracle’s Hyperion software to close its books in half the time it used to. “With fewer workers needed to collect financial information, Wolters Kluwer is hiring more analysts to help sift its data on profits, revenue, and cash flow, among other things, to help in planning and forecasting.”1

Many fear that machines will replace people. That might be the case for routine accounting tasks, such as bank reconciliations and invoice payments, but new opportunities have emerged. As artificial intelligence becomes more accepted in the workforce, it can be an essential partner. Artificial intelligence will not replace CPAs; rather, their duties, responsibilities, and contributions will change for the better. Artificial intelligence will eliminate certain day-to-day tedium, freeing up CPAs to work where human attentiveness is needed, adding value to the business.

We are at a point where accounting automation is the major technological innovation that will impact everyone working in the profession. This article explores components of this technology model and assesses factors limiting its current use, opportunities for the future, and skills needed for those working with innovative technology.


Defining Accounting Automation

In Accounting Today, Therese Tucker describes robotic process automation (RPA) as a system to capture, manipulate, and interpret transactional data flowing from myriad information technology (IT) systems and applications.2 RPA reduces the time spent performing repetitive tasks, and linking it to data analytics and artificial intelligence opens up a world where machines have the potential to augment (and perhaps replace) the work of humans. For CPAs, the key to a successful integration of accounting automation, or robo-accounting, will be a robust understanding of processes and the necessary internal controls.

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