Artificial intelligence (AI) is already transforming the way we live and work, but we’re on the cusp of a full-fledged revolution. Industries like manufacturing are already starting to feel the brunt of this automation takeover, but what about industries like accounting, which are more nuanced, and require more education?
As it stands, there’s no industry that’s completely exempt from feeling the encroachment of AI and automation technologies. In fact, accounting may be more susceptible than most people believe; because it’s such a valuable field, developers are incentivized to create technologies to make it easier or less costly to operate.
In this article, we’ll take a look at one piece of the accounting puzzle: the accounts payable process. How could AI technology transform this process, and how will that affect accounting workers, accounting firms, and other businesses with an accounting department?
The Accounts Payable Process
Accounts payable is all about managing your payable obligations. You owe money to vendors and suppliers who provide your business with the materials and services it needs to operate, and the people in accounts payable will make sure their invoices are paid in full. They’re also in charge of reconciling balances, to ensure there are no extra charges or missing funds.
It’s an especially relevant sub-field in accounting, along with accounts receivable, because it’s technically hypothetical to automate it. High-level accounting, like long-term financial planning and business-focused strategizing, would be much more resilient to AI and automation. The question is, in which ways will AI transform this department?
AI and Accounts Payable
These are some of the most prominent effects we’ll begin to see as AI and automation make their way into accounts payable departments:
- The biggest fear is automation. One of the most powerful uses of AI is automating repetitive tasks; if a process can, in any way, be predicted and/or reduced down to a simple set of instructions, a sufficiently powerful AI tool can handle it on your behalf. More AI tools are being developed to assist your accounting department, and accounts payable isn’t exactly the most complicated process, so it’s only a matter of time before some accounts payable processes become almost universally automated. This may be perceived as a threat to human beings in the accounts payable department, but it’s also possible to change your working patterns to work in combination with new tech to get the best of both worlds, so to speak.
- Integration with other departments. AI may also start to stitch together different elements of the accounting process to make things more universal, and easier to manage from a high level. The lines may soon start to blur between accounts payable, accounts receivable, and high-level strategic functions, so if you’ve historically specialized in one area, you may find yourself evolving to cover a more comprehensive range of responsibilities.
- Increasing consistency and error reduction. If you work as a team leader or in a supervisory capacity in the accounting department, you’ll perhaps be most interested in the dramatic increases to consistency that AI could bring. Even the best-trained and most experienced human beings can make mistakes or handle their responsibilities in slightly differing ways, but an AI program will always do the same thing, and will never make a mistake. That’s not to say that AI will be completely problem-proof, but the tiny inconsistencies and data logging errors will be tremendously reduced.
- Higher-scale data analysis. One of the best capabilities of AI is its ability to analyze vast quantities of data. Data analysis has historically been relegated to higher-level accounting functions, but with the next-generation capabilities of AI, data analyses will be associated with nearly every subfield of the accounting department.
- Real-time audits. In most companies currently, accounts payable utilizes a phased approach. You address invoices as necessary, when you approach their due dates, ensuring that vendors and suppliers are paid in a timely manner. Then, either weekly, at the end of the day, or at some other time interval, you’ll reconcile those payments to ensure everything was done correctly. With better AI, these audits could happen in real-time; working together with AI, a human could easily make a payment and update the central records very quickly.
If you currently work in accounts payable, or if you manage an accounting department, it’s important to think about how these new technologies will affect your work in the near future. In some cases, it means educating yourself and choosing a different line of work or organizational structure. In others, it means being willing to incorporate more technology into your field. There isn’t a single right way to address this trend, but you’ll need some kind of strategy if you’re going to prepare for these changes.