How to Predict AI's Disruption to Accounting Firms

Advances in artificial intelligence (AI) and related technologies appear to be arriving quickly, and those advancements could have a significant impact on the roles and careers of accountants and trusted advisers.

But before those advancements disrupt accounting firms, they will probably disrupt technology consulting firms, such as Tata, Accenture, and Cognizant.

Therefore, accountants and trusted advisers can observe disruption at those and other technology consulting firms and use such observations to improve their resiliency and innovation strategies, personally and at their firms.

Why Disruption Will Likely Happen At Technology Firms Before Accounting Firms

Large technology consulting firms are already using AI technologies in their operations, so they already have processes for integrating these technologies into their teams and organizations.

These firms already use AI for tasks such as data analysis, and they are exploring how generative AI could be used like a co-worker. They are likely to continue to invest in and adopt new AI technologies to improve their services and stay competitive.

As they invest and experiment, these firms may experience workforce displacement and layoffs. They may also develop new service offerings and business models that incorporate AI and automation.

Traditional accounting firms, on the other hand, may be more resistant to disruption from AI in the short term, as they are less likely to have adopted AI technologies in their operations.

However, AI has the potential to automate many routine tasks in the accounting field, such as bookkeeping and auditing tasks, and to provide insights that can help accountants make better decisions. As a result, accounting firms are likely to face increasing pressure to adopt AI technologies to remain competitive in the long term.

Leveraging Lessons from Others’ Disruption

In order to stay ahead of the curve and proactively prepare for the future, it's important to observe and learn from the experiences of technology consulting firms as disruption occurs.

Tech consultancies will use ChatGPT and other similar technologies to assist programmers in their coding work because it is highly effective for that use case.

Accountants and auditors can identify the specific AI technologies and applications that will be most relevant to the their tasks.

For example, AI-powered audit tools like Mindbridge could play an increasingly important role in the audit process, while machine learning algorithms may be used to automate tasks like financial statement analysis and tax preparation.

Leaders at accounting firms should observe new business models and service offerings that the technology consulting firms develop as a result of their continued adoption of AI. Although the approaches that technology firms take might not translate exactly to the accounting profession, the lessons may be the same.

For example, accountants may further develop their data-driven service offerings in areas like data analytics and services for automating routine tasks to free up time for more value-added activities.

Benefits of Proactive Planning for Disruption

By being creative and innovative and by staying ahead of the curve in terms of adopting and using AI technologies, accountants can position themselves as leaders in their firms and in the profession. They can recommend new services for existing clients as well as organizational changes that help cut costs.

Firms that can identify new business models may establish themselves as leaders in the field, and differentiate themselves from competitors who may be slower to adapt.

Overall, both IT and consulting firms and traditional accounting firms are likely to be impacted by AI in different ways and at different rates.

The extent and pace of disruption will depend on a range of factors, including the specific services provided by these firms, their business models, and their willingness and ability to adopt new AI technologies.

Individuals and teams that believe in their ability to grow and learn may benefit by embracing the opportunity for change.