Artificial intelligence refers to a set of technologies that simulate human thought when performing tasks.

The field broadly encompasses:

Machine learning – where software recognises patterns in data

Predictive AI – where software uses those learned patterns to suggest actions to human users

Generative AI – where software uses learned patterns to create new content (this includes AI that writes text and creates images)

AI in accounting stems largely from the predictive branch. It helps to sort and organise data, which can automate labour-intensive data-entry, data clean up, and coding tasks.

Because it can identify patterns so quickly, it’s got a huge role to play in forecasting, reporting, and recognising fraud.

Examples of AI in accounting

AI research has been going on for decades and it’s delivered lots of products that are already in the modern accounting toolkit.

Receipt and invoice scanners

AI-enabled software will read electronic or hard-copy bills and receipts to capture the key data and enter it into the accounting ledger.

Categorising and reconciling transactions

Software suggests matches between transactions on the bank statement and in the ledger based on transaction amounts and vendor names. It can also suggest how to categorise those transactions.

Again, the user can confirm or override the suggestion.

Invoice reconciliation

Online accounting software can search business bank accounts for deposits that match outstanding invoices. Unpaid invoices remain on the receivables list.

Accounts receivable

Software can send automatic reminders to customers whose invoices are coming due (or have gone past due). It can also flag them on an aged receivables report.

For more information contact McGowan Accountancy Services