For decades, the life of an accountant was defined by the ‘grind,’ hours spent on manual data entry, reconciliation, and chasing paper trails. This definition has evolved through advances in technology.
AI is now widely considered the technological revolution of our time, transforming many aspects of our daily lives.
AI might be the latest innovation in accounting tools, but it’s not the first new technology to advance all aspects of tax and accounting, and it should be embraced the same way you once had to learn Excel.
So many people are hesitant to trust AI, which is understandable. We all read the articles about how Artificial Intelligence will replace our jobs. Despite the headlines, AI is not coming for your job or mine – it’s coming for our workload. AI is now mainstream; get on board or get left behind.
If you are unsure where to start, try exploring a simple AI-powered bookkeeping tool or an automated expense tracking app. Taking just one step, like experimenting with a platform that automatically categorizes your business expenses or reconciles transactions, can help you gain confidence and see the real-world benefits firsthand. Start small and build your knowledge as you go.
As a progressive CPA firm, we are actively employing AI to improve our clients’ financial positions; with sophisticated tax strategies, more efficient (and yet more detailed) financial statement audits, a quicker turnaround in the production of accounting records, insightful company specific financial analysis, fraud detection, financial forecasting...the number of meaningful ways we use AI to enhance our client’s position is an article in itself.
You can’t glean value from accounting if you don’t know the definitions of assets, liabilities, revenue and expenses. In the same way, for your company to mine value from AI utilization, you need to have a foundational knowledge of key terms and concepts.
Here are a few key terms to build your foundation:
- Artificial Intelligence (AI) is a general term used to describe any technology that allows computers to do tasks that usually need human intelligence.
- Machine Learning (ML) is a method for achieving AI where computer programs extract knowledge from data and adapt their behavior without being explicitly programmed for each step.
- Agentic AI is a technology capable of making decisions and carrying out goal-driven actions independently or with little human guidance.
- An AI Agent is a tool created to perceive its environment, make decisions, and independently complete a specific task or series of tasks.
- AI Assistants are sophisticated AI programs designed to understand user intent, provide information, and perform a broader range of tasks than chatbots.
- An AI Chatbot is a particular kind of intelligent bot that uses a conversational interface.
- A Bot is an automated software program created to carry out specific, repetitive tasks according to a set of predefined rules.
- An AI model is a specialized computer program that functions as the ‘brain’ of an AI tool.
- An Algorithm is a step-by-step process or set of rules that an AI model uses to solve problems or identify patterns in data.
- Guardrails, robust mechanisms, and controls designed to ensure that AI systems operate within acceptable ethical, legal, and technical boundaries.
- Hallucination is an AI output that sounds plausible but is factually wrong or illogical.
In the modern economy, a small business is only as agile and successful as its data allows it to be. While ‘doing things the old way’ feels safe, it inevitably becomes a competitive disadvantage. Automated management systems providing AI-driven, timely information flow, sophisticated analysis, and meaningful market insight are no longer luxury features: they are essential for any business aiming to scale in a digital-first market.
A simple next step is to review your current accounting software or systems to see what AI-powered features may already be available. This evaluation can help you identify opportunities to automate repetitive tasks or gain better insights from your financial data. Starting here provides a clear pathway to begin your company’s AI journey.
Angela Piñon (apinon@stcpa.com) is the Outsourced CFO & Advisory Services Manager at Schmersahl Treloar CPA. She can be reached at 314.966.2727.