From mechanical calculators to the birth of the internet, the quest for artificial intelligence (AI) has spanned centuries. Now, its reach extends to the heart of businesses: financial reporting, where it promises to unlock a new era of accuracy, efficiency, and insight.
While AI is impressive when it comes to increasing efficiency and accuracy in tasks like interpreting and quantifying financial statements, its limitations emerge when contextual judgment has not been explicitly modelled.
Using AI tools without understanding its limitations and assumptions can compromise transparency, privacy, and information control. This lack of understanding is underscored by the recent lawsuit against OpenAI and Microsoft for allegedly using copyrighted content from The New York Times to train their chatbots, highlighting anxieties about data-gathering practices and potential plagiarism.
With global data creation projected to grow to more than 180 zettabytes by 2025, it is crucial to understand how AI systems make decisions, source validation, and convince users of their worth.
How AI is helping to fill gaps in accountancy
Like many other economies, Singapore’s accountancy sector faces a talent shortage. Compounding this challenge, accountants, auditors, and finance professionals need diverse skills to ensure accurate and reliable financial statements. This agility is crucial for navigating shifting regulatory landscapes and tackling ESG goals with accountability.
Companies are turning to AI-focused solutions to fill talent gaps and reshape their operations. Adopting automation can boost productivity by aiding in mundane tasks, quickly identifying errors, detecting fraudulent activities and extracting deeper insights from financial data
In 2020, one of Singapore’s leading financial institutions implemented an AI-powered fraud detection system utilising machine-learning algorithms to analyse vast amounts of customer data, transactions, and behavioural patterns in real-time, searching for anomalies that might indicate suspicious activity. Machine learning algorithms are now scrutinising financial statements with eagle eyes, detecting fraudulent activities with pinpoint accuracy.
Challenges and opportunities of integrating AI into our world
Of course, integrating AI into existing processes is not without its challenges. Ensuring the availability of accurate, representative, and high-quality data is crucial, as it could lead to unreliable results. Companies must also approach AI development responsibly, consider ethical implications, explainability and remove potential bias.
Rising costs and ensuring employees understand the broader implications of AI are critical considerations for organisations, especially SMEs. Beyond the technical skills required to operate the technology, talent mastery necessitates understanding the ethical dilemmas and limitations of using AI. With careful planning and responsible implementation, tailoring strategies to meet the specific needs of businesses of varying sizes and models, AI has the potential to transform our business landscape. This shift would also empower financial professionals to unlock new levels of value for themselves and their clients.
Accountants are pivoting from a “number crunching” job to an analytical role to identify and justify processes and operations with financial reporting. Making accounting the bedrock of every business, ensuring financial health, business growth and transparency.
While the initial excitement surrounding automation can overshadow the complexities of emerging technologies like AI, the challenges and considerations they present hold a crucial key: the opportunity to shape a human-centred, ethical future. Instead of focusing solely on tool development, it is about prioritising the user and equipping them to ensure their needs and values are embedded in the technology’s design and implementation.
For example, the auditor’s role remains crucial in fostering a balanced integration between AI and human expertise in financial reporting. This symbiotic relationship positions auditors as the guardians of accuracy, transparency, and ethical standards for the information generated by AI tools. To this, we ultimately fall back on the core requirement of our profession – ethics, which means we accountants have a significant role to play in ensuring transparency and impartiality.
There has never been a better time to be an accountant
Looking ahead, it’s clear that AI has the potential to transform the finance sector, as evidenced by initiatives like the AI Verify Foundation, which are underway. As AI has evolved from a general-purpose technology to a tailored tool for finance teams, continuous learning and development have become even more imperative. By leveraging AI technologies effectively, finance professionals can equip themselves with the right skills to embrace the AI revolution and shape the industry.
The potential that AI technology carries with human expertise can yield excellent results for the accountancy profession. While we recognise strengths and limitations, the priority is to equip the professionals in our field with the proper understanding and skills to utilise these tools for the greater good. Staying true to our core values and beliefs – ethics and transparency – in our approach to AI and developing our work is essential to creating a resilient future for a prosperous economy.
About the author
Daniel Leung is the Country Manager for ACCA Singapore where he is responsible for leading the group’s external engagement with regulatory bodies, government agencies and partners. He works closely with the organisation’s membership, employers, learning and policy teams to deliver ACCA’s Singapore strategic priorities and deliver change for public good.
