The accounting profession stands at the cusp of a new era of digital transformation powered by intelligent automation and artificial intelligence. These exponential technologies promise to reshape the role of accountants and redefine best practices. This comprehensive guide explores how leading accounting teams harness automation and AI to elevate performance, unlock strategic insights, strengthen controls, and focus talent on high-value activities.

The Pace of Change Accelerates

Digital disruption has put accounting on an accelerated path towards a technology-driven future. Key market forces include:

Rise of Big Data - The volume of financial data organizations must manage grows exponentially. Traditional systems strain under this vast data load. AI and automation provide capacity to process, analyze and derive insights from large data sets.

Customer Expectations - Stakeholders expect real-time financial information and insights rather than periodic reporting. Automation enables continuous accounting with instant access to results.

Workforce Dynamics - Newer generations of accounting talent favor technology-enabled roles over repetitive manual tasks. Intelligent solutions improve job satisfaction and retention.

Compliance Complexity - Increasing regulatory obligations around financial controls, standards, disclosures and data privacy require sophisticated systems to manage compliance risk. This motivates automation.

Pace of Transactions - The speed of modern commerce driven by digital payments and e-commerce mandates automated systems to keep up with transaction volume and velocity.

Margin Pressures - Organizations implement automation to reduce costs and enable leaner accounting departments while supporting growth.

Together these factors make automation and AI an imperative. According to Gartner, by 2025 automation will handle 50% of standard accounting work. The core mandate for CFOs today is embracing this change through updated skills, staffing and systems.

Benefits of Intelligent Accounting Systems

Leaning heavily into automation and AI can transform the impact of accounting. Benefits include:

1. Increased Speed - Automated processes complete routine accounting tasks in a fraction of usual timeframes. This enables real-time reporting and responses.

2. Enhanced Accuracy - AI with machine learning virtually eliminates human error by consistently applying programmed rules and logic to transactions.

3. Scalability - Cloud-based automation handles spikes in transaction volumes easily by adding computing capacity, unlike fixed manual capacity.

4. Standardization - Embedded automation ensures standardized processes are applied consistently across locations.

5. Advanced Insights - By processing more data faster, automation and AI unearth deep insights hidden in financial data through advanced analytics.

6. Improved Controls - Programmed controls and segregation of duties improve compliance. Automated anomaly detection identifies potential fraud.

7. Cost Savings - Automation optimizes staff time and eliminates redundant systems, reducing accounting costs long term.

8. Enriched Jobs - Automating mundane tasks allows accounting staff to focus on strategic initiatives that develop new skills and impact.

9. Competitive Edge - Superior insights and responsiveness from automation boost enterprise decision making speed and performance.

10. Future Readiness - Digitally transformed accounting functions are well positioned to leverage new innovations in intelligent automation as they emerge.

The multi-fold benefits fundamentally upgrade accounting capabilities.

Automation Use Cases in Accounting

Intelligent automation and AI can reshape nearly every area of accounting. Here are top applications:

Accounts Payable

- Invoice processing and matching

- Vendor account reconciliations

- Payment disbursements

- Expense reimbursements

- Fraud detection

Accounts Receivable

- Customer invoicing and billing

- Cash application and allocations

- Deductions and adjustments

- Collections

- Credit analysis and risk

General Ledger

- Journal entries

- Account reconciliations

- Variance analysis

- Close cycles

- Intercompany accounting

Tax Accounting

- Tax provision calculations

- Local/national tax form preparation

- Sales and use tax management

- Tax payments and filings

- Research on tax code updates

Treasury Management

- Cash flow forecasting

- Bank reconciliations

- Debt management

- Currency risk management

- Liquidity monitoring

Management Reporting

- Custom report creation

- Ad hoc analysis

- Periodic financial statements

- Results presentation builds

- Data visualization

Audit Support

- Data gathering for auditors

- Anomaly identification

- Document audit trail creation

- Control testing automation

- Compliance monitoring

Budgeting & Planning

- Budget formulation

- Forecasting scenarios

- Driver-based models

- Workforce planning

- What-if simulations

The extensive use cases demonstrate automation’s expansive possibilities. Below we explore two high-impact applications in detail - smart report creation and continuous accounting.

Smart Reporting with Natural Language Generation

Management teams depend on digestible reports to track financial metrics and glean insights. But compiling monthly and quarterly reporting packages manually consumes tremendous time. Rote drafting of commentary also limits analysis. Enter natural language generation (NLG).

NLG is an AI technique that converts data into written narratives. Rather than having staff copy last period’s report and plug in new numbers, NLG automation can instantly generate an entire management report from scratch.

After feeding the algorithms company guidelines and past reports as examples, NLG software can autonomously:

- Import latest period results from financial systems

- Analyze current period performance vs. historical trends

- Call out major variances or anomalies

- Provide commentary explaining key drivers and changes

- Format into presentation-ready reports with graphs

NLG systems like Narrative Science produce reports with clarity and depth faster than humans. And the constant learning capabilities of AI mean the reporting continually improves over time based on feedback.

By tapping NLG, accounting teams relieve staff of repetitive reporting while benefiting managers with faster insights. Leaders also get on-demand custom reporting. The future of reporting is undoubtedly automated.

Continuous Accounting Through Automation

Traditional monthly close processes struggle to keep pace with the speed of modern commerce. Closing cycles reduce organizational agility. Continuous accounting via automation solves this.

Rather than periodic reporting, continuous accounting uses automation to:

- Ingest data in real-time from transactions systems

- Apply rules to automatically reconcile accounts and post entries

- Identify and flag exceptions for staff to resolve

- Generate rolling financial statements on-demand

This creates real-time visibility into balances and performance. By automating repetitive reconciliation and posting tasks, finance staff avoid monthly fire drills. They redirect energies towards value-added analysis and advisory support of business leaders.

According to research firm Gartner, continuous accounting can:

- Shorten close cycle by 50% or more

- Cut reporting costs by 20-40%

- Accelerate real-time reporting by 100%

For organizations seeking greater financial agility, continuous accounting is essential.

Selecting Finance Automation Solutions

Today’s market provides automation solutions tailored to virtually every accounting process. When assessing options, consider these criteria:

- Cloud deployment for scalability, speed and lower IT overhead

- Embedded AI and machine learning capabilities

- Pre-configured integration with major accounting systems

- Drag-and-drop interfaces for non-tech users to build workflows

- Advanced analytics and visualization tools

- Catalog of pre-built templates and use cases by accounting process

- Robust data security and access controls

- Mobile app support for approvals and information access

- Ongoing enhancements through regular software updates

- Responsive customer support and adoption consulting

Leading vendors include Workday, Oracle, BlackLine, AppZen, FloQast, and others. The ideal solutions will blend ease of use with advanced intelligence.

Governing Automation and AI Initiatives

Implementing new technologies requires structured programs for success. Best practices that accelerate automation returns include:

- Executive sponsorship - Ensure initiatives have active C-suite advocates reinforcing urgency.

- IT partnership - Engage IT teams early as partners to coordinate systems integration and data flows.

- Prioritized roadmap - Sequence automation rollouts thoughtfully based on expected ROI, ease of implementation and interdependencies.

- Change management - Clearly communicate changes, train staff on new skills, and address transition concerns.

- Dedicated resources - Appoint process experts to document requirements for automation and monitor results.

- Continual enhancement – Adopt continuous improvement mindset to maximize value of solutions through steady enhancements.

With a coordinated approach, automation efforts gain traction and acceptance.

The Future of Accounting - A New Paradigm

Intelligent automation constitutes a true paradigm shift for accounting. Tactical mundane tasks get handled digitally while talent focuses on high-level analysis and advising the business.

By embracing this shift, leading accounting teams position themselves for the future with:

- Extreme productivity enabled by 24/7 automation

- On-demand scalability to support rapid growth

- Real-time financial information at their fingertips

- Superior data insights that improve decision making

- Streamlined compliance through consistent standards

- Enriched accounting jobs focused on business partnership

- Competitive advantage through reduced costs and improved agility

Rather than fall victim to disruption, forward-looking functions harness automation to forge the finance group of the future starting today.