Is artificial intelligence a threat to accountants?

1 year ago

Some pundits have identified the accounting profession as particularly vulnerable to take-over from advanced computing systems. According to The Future of Employment, a 2013 report by Carl Frey and Michael Osbourne of Oxford University, 47% of total US employment is liable to be replaced by artificial intelligence.
In their extraordinary study, they categorised over 700 jobs, and graded these jobs by the probability that these jobs are able to be computerised – meaning that an artificial intelligence could take a human’s place in performing the function. The jobs least likely to become computerised are those such as recreational therapy, whereas telemarketers are 99% likely to be replaced by computers.

Accountants and auditors do not fare well by Frey and Osbourne’s study – according to their figures, there is a 94% chance that these jobs will become computerised in the near future.
But how close to the truth is this prediction? How worried should accountants be?

Automation and its effects on employment

New technology will, inevitably, take jobs. The spinning jenny was a mechanised device invented by James Hargreaves in 1764 that revolutionised the yarn production process. It was so effective that Hargreaves had his machines destroyed by yarn spinners, and he had to take his production into hiding. But the spinning jenny was an inevitability, and inevitably led to the vast extension of the clothing industry.
Artificial intelligence is no different – jobs will be lost, but the new opportunity that emerges from the new technology will leave its mark in new employment. As has always been the case, adaptability to the new economic climate will be a large determinant of success post-change.

Accountants already use AI

The accounting profession has embraced the computer revolution. The most prominent (and ubiquitous) computer program in the field is Microsoft Excel, whose digital spreadsheets hugely reduced the burden of accountants.

Similarly, programs like Sage that allow people to access their books from wherever there is an internet connection, bring vast improvements to both accountants and businesspeople. Being able to see the present state of a business, and having a medium through which business information is more easily understood, allow for productivity gains – the less time spent on the tedious, means more time to spend on the more creative aspects (or, perhaps, more time for leisure).

These computer programs have made a number of jobs redundant – but these are largely administrative jobs.
What would it take to make accountants redundant? The fact is that an artificial intelligence that would make the accounting profession history would likely make most jobs redundant. The kind of problem-solving, creativity and pattern-finding that an accountant has to produce in their role requires a kind of intelligence that is not currently reproducible. It involves qualities of thought that are used by engineers, strategists, marketers, lawyers and other professionals. In the scenario in which artificial intelligence sophisticates to that point, it would fall to the newly-anointed artificially intelligent accountant to find a way to resolve the problem of comprehensive unemployment.

While many of the number-crunching aspects of the profession are likely to fall, the business savvy and strategic competency that is inherent in the accounting profession will live on.

How to use your accountancy skills for the greater good

For accountants specialising in small business, helping your clients to achieve their goals is a […]

1 year ago
An introduction to interest rates for the small business owner

The great political and economic trends that sweep across society can cause businesses to suffer […]

1 year ago
5 things you should know about South African women entrepreneurs

South Africa has a burgeoning class of women entrepreneurs who are doing extraordinary work in […]

1 year ago
4 career pivots for accountants

Being an accountant is a lucrative and frequently rewarding career for many people. But as […]

1 year ago
Wrapping your head around Sage’s services

Sage’s comprehensive cloud-based accounting software may seem intimidating to the uninitiated. With a wealth of […]

1 year ago
Why should I choose Sage cloud based accounting software

As a small business owner and entrepreneur, you need to exercise discretion in how you […]

1 year ago
What is VAT

VAT is an acronym for Value Added Tax. In South Africa, VAT is currently 14% […]

1 year ago
What is a VAT vendor, and which items are exempt from VAT

In part one of this VAT series, we looked at what VAT is. In this […]

1 year ago
Payroll – how Sage makes it painless

Sage One Payroll is a comprehensive small business-oriented payroll solution designed so that you can […]

1 year ago