I Robot

Sixteen years ago just as the tech bubble was about to erupt like Mount St. Helens, two software executives from a company in California dropped by my office to demonstrate their latest product, an accounting application that could be accessed remotely via the Internet.

Back then, vendors like those were referred to by the acronym of ISPs – Internet Service Providers – which as most of you know by now the online product movement has evolved to the more updated and colorful nomenclature of “cloud applications.”

I compared that experience to the first time I saw my uncle demonstrate the Bowmar Brain, a hand-held electronic calculator back in 1972, or when I witnessed a crude form of email in the early 1980s.

Today, many CPA firms have eschewed the expense of servers or on-site remote people and opted for the hundreds of available cloud apps, as over the past decade even the traditional accounting software vendors now offer a cloud version of their product lines.

But there’s an emerging trend that’s a bit eye-opening and, from my standpoint, a tinge frightening.

Now, accounting “robots” are beginning to elbow their way into the arena.

Robots or “Machine Learning” is currently getting built into most financial software programs. Global vendors such as Sage, Xero, and Intuit either all have it or are currently in beta testing.

Essentially the "bot" can be accessed via text or voice. It scours the data in a tax or financial program and tells you what you need in literally, a fraction of a second. Sort of like a min-Watson inside a financial software program. Eventually it learns trends and preferences and will offer suggestions on changes. They integrate with a firm’s ERP system to automate the end to end accounting processes. While I read somewhere that the human error rate is between 10-15 percent in any accounting department, while the robotics accuracy is touted as 100 percent. So ideally CPAs can wave goodbye to those 70 and 80-hour workweeks.

So what’s the problem?

Well, as with anything related to artificial intelligence, there’s always the factor of human uneasiness and of course the fear of becoming obsolete. After all, look what happened to typesetters and layout personnel in the newspaper and magazine industry once that process became automated.

I seriously doubt any software will render accountants obsolete, as the work will still require that element of human judgment. But I’m not going out on a limb here by saying that the profession might have to learn new processes and change the often antiquated approach many have taken for years.

Now if these robots can somehow teach my daughters to adhere to a budget with 100 percent accuracy we may be on to something.