The Impact of AI on Accounting and Bookkeeping Processes

The Impact of AI on Accounting and Bookkeeping Processes

If you are an accountant, you probably know what bookkeeping Processes refers to. In this article we will talk about how artificial intelligence influences bookkeeping processes. The great irruption of artificial intelligence in our lives can be as close as it is far.

The truth is that is difficult to predict when it will completely reach us, but each day its increasingly present. Today we use voice assistants, chatbots, internet, recommendations according to our tastes …

The future of AI is closer and faster than you think. Thanks to the acceleration of the digital transformation in accounting and finance, the machines do the repetitive tasks for us. Through AI, we can dedicate time to the tasks for which we are best qualified.

For this, if you are an accounting professional and you are interested in the advances that technology has had in this field, this review is for you.

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Accounting Process

Bookkeeping Processes

Bookkeeping processes is the systematic and organized recording of financial transactions of your business. This accounting practice is essential for the growth and maintenance of your business. Some financial transactions that you may see involved with bookkeeping include:

  • The invoicing of goods or services granted to your clients.
  • The record of invoices from your customers.
  • Verification and registration of your suppliers’ invoices.
  • Payment to your suppliers.
  • Processing your employee pay and government reports.
  • The creation of financial reports.

The most important aspect of bookkeeping is that you keep an accurate and update record of all your business information. Accuracy is the most important part you must ensure in this process. Bookkeeping is designed to provide you with the preliminary information necessary to create your financial statements.

Every transaction you make must be recorded in the books, and all changes must be continually updated. Today, most of the bookkeeping around the world is done with the help of software. The software you choose should help you manage information and process data.

Artificial Intelligence plays a very important role in this area.

Is bookkeeping and accounting the same?

Don’t you confuse bookkeeping process with accounting. Bookkeeping and accounting have many areas in common, but each process is different. Similarly, the functions of your bookkeeper and your accountant overlap.

But your business requires both positions in order to maximize your financial potential. For example, a bookkeeper may encourage you to review your accounts receivable when customers are late. It can also alert you when your cash balance is too low.

They also let you know if your expenses are in line with budget. On the other hand, an accountant can encourage you to apply for a loan (and help you manage it effectively). A loan can help you buy necessary equipment or make improvements to your facilities.

An accountant keeps track of the financial pulse of your business so you don’t trade it at a loss. These qualified professionals seek to help you and your business. A bookkeeper performs your tasks administratively.

An accountant takes on an advisory role to oversee your financial statements and meet the requirements set by banks and government agencies. As a business owner, you need the experience of both.

Bookkeepers and Accountants Will Help You Succeed Financially

When you have a financial report, do you know how to interpret it? The data you have is only as reliable as the precision with which the records are kept. There is no getting around the importance of accounting and bookkeeping to growing your business.

Both the accounting and bookkeeping processes help your business make a profit. If your business is just starting you can handle finances initially, but as your business grows, you will need a bookkeeper and accountant.

Besides, if your business has both, it will be better equipped to manage day-to-day affairs that go beyond finances.

How can AI be applied in bookkeeping?

Basic functions such as making phone calls, are an example of what you can automate with AI in accounting. However, AI has somewhat limited potential in some functions you use, such as analyzing processes and helping you with your corporate strategies.

In bookkeeping, some of the areas AI can help you with are:

  • Calculate your taxes
  • Perform tax classification of your documents.
  • Identify audit points.
  • Analyze the behavior of your results indicators.

Your accounting studies can be reinvented thanks to the advancement of AI. The structure, the processes, the quality of service provision, the relationship with customers, the results: everything can change from now on with the incorporation of an AI strategy into your company.

And there are already projects in development that bookkeeping could help you with:

  • Automation of the internal processes of the accounting study with cognitive computing.
  • Automation of the relationship of your customers with machine learning.
  • Detection of your tax and labor risks.
  • Suggestion of preventive actions based on trends and behaviors.
  • Automated identification of calculation rules and tax framing.

However, you will see that this reinvention is just beginning.

The great revolution will occur from the moment in which tax and accounting systems adopt robotic processes (RPA), integrating them with other technologies and tools.

You, accountant of the future, in a while you should have a virtual assistant. AI help you remember the document you need to close the salary settlement. And not only that, you could even look for that customer documentation, close the settlement and upload it.

Incredible, don’t you think?

Conclusion

Consistency is the mainstay you must consider with bookkeeping process. By ensuring that transactions are recorded in a timely manner, you will have accurate records that you can trust.

Bookkeepers work to match a company’s and a bank’s records. Your bookkeeper should reconcile the statements on a monthly basis. Bookkeeping is one area of ​​any business where you shouldn’t take shortcuts or be disorganized.

For example, you should not keep records in a shoe box. Regardless of the method you use to complete your bookkeeping (spreadsheets, accounting paper, accounting software), it is very important that you constantly update your main ledger.

Otherwise, you will never know if your business is making a profit, if you need more cash, or if you can take out a loan. Artificial intelligence will undoubtedly help you automate everything to better manage bookkeeping.

However, it is your responsibility to ensure an orderly and correct management of your finances. If you want to learn more about artificial intelligence and its benefits in the accounting territory, check out our blog.

Also learn about My T, an AI-based APP to considerably improve your accounting process.

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