If you’re an accountant, your job is more likely to be automated than is a retail salesperson’s or a technical writer’s.
Last year, entrepreneur and author Shelly Palmer named accountants and bookkeepers as two key candidates for automation. And speaking at MIT last year, Kai-Fu Lee, the founding president of Google China who also built Microsoft’s research lab in China, said that he believed white collar work (including accounting) will succumb to robots before blue collar tasks.
But this news comes with a caveat: Automation isn’t synonymous with replacing humans.
Man vs. machine?
Research from Gartner (available to clients) shows that this is what more than half of employees want if their companies choose to implement AI. Machines outperform humans at rules-based, repetitive tasks such as scanning large amounts of receipts. Conversely, humans outperform machines at cognitive tasks such as financial planning.
Regardless of role, automation will change accounting in a key, collective way: The profession will shift from pure accounting to business consulting.
Whether your small business employs credit controllers or finance managers, you must prepare your team to focus on clients’ finance and technical strategies. That’s because any rules-based, repetitive task—and those abound in accounting—will go to machines.
Robotic process automation (RPA) will erase 20 percent of “non-value-added” finance tasks by 2020. Small business leaders who don’t learn how to automate accounting tasks that machines excel at risk losing clients to competitors that do.
In this article, we’ll share six accounting roles that will likely see high levels of automation within the next five years. We’ll also explain how to automate accounting tasks within each role.
You’ll learn which aspects of the role you should give to machines, and which tasks should stay in your colleagues’ capable hands.
The role: Credit controllers find and recover unpaid debt that businesses or individuals owe to an organization. They also assess how credit-worthy potential customers are.
What machines will do: Cash disbursement
Credit controllers will use cloud software features such as invoice management and invoice processing to automate the annoying follow-up process. Most of these software tools sync with SMBs’ banks. This makes it easier to transfer funds electronically. And since Gartner predicts that average RPA prices will decrease by 10 to 15 percent in 2019, cash disbursement is forecast to be automated further.
What humans will do: External relations
Future credit controllers will focus most of their work on liaising with business owners and clients. This will involve renegotiating payment plans, visiting debtors who don’t pay during the automation process, and—in a worst-case scenario—starting legal proceedings if debts don’t get paid.
Financial account managers
The role: Financial account managers establish and maintain a company’s financial plans and policies. They maintain fiscal records, review monthly transactions, and interpret financial data for senior leadership. They also play a key role in year-end audits.
What machines will do: Financial controlling and external reporting
There’s already a full category for financial reporting software, and you’d be hard-pressed to find cloud accounting software without it. Bank reconciliation, fixed asset budgeting, and several types of reporting all come with this package.
What humans will do: Auditing
Automation leaves an audit trail in case an SMB gets a knock on its door from the IRS. With this task taken care of, financial account managers will spend more time tracking financial laws and regulations.
The role: Finance managers tell small business owners how to plan their long-term strategies for revenue growth. They also analyze markets for new business opportunities, like mergers and acquisitions (M&A).
What machines will do: Revenue management
Revenue management is already automated; in fact, it has its own software category. This is an asset for SMBs in service-based industries—for example, hotels. Over the next five years, they’ll be able to offer consumers personal promotions based on their unique buyer behavior. This is made possible in large part by increasing amounts of consumer data.
What humans will do: Business development
More businesses are choosing to bring revenue management to the forefront rather than keeping this function within a silo. Finance managers will spend more time working with sales, marketing, and other cross-functional colleagues on M&A activity and new business. As more small businesses seek alternative forms of capital, finance managers will work with peer-to-peer lending sites to grow SMB cash flows.
Financial and accounting technicians
The role: Accounting technicians collect, check, and analyze financial details including reports, financial statements, budgets, and more. They’re the first checkpoint before handing these details over to accountants.
What machines will do: General accounting operations
Robotic process automation (RPA) automates repetitive, rules-based processes. Since accounting fits the bill, many activities—such as book-tax differences and preparing tax returns—already use RPA. Over the next five years, businesses will start using RPA to do revenue audits as well.
What humans will do: Financial planning and analysis
Financial planning and analysis is far from being rules-based, repetitive, and prone to automation. This work demands more judgment and finance experience than other accounting roles. And since many of these roles are both judgment-based and include external engagement, they demand close relationships with business users and corporate leaders.
The role: Financial administrators perform budget and payroll transactions, maintain separate financial accounts, and make sure these financial records are correct. They help businesses manage and allocate their resources.
What machines will do: Revenue management
Techniques such as optical character recognition (OCR) reduce data entry by processing handwritten receipts. As this AI technique becomes more advanced at pattern recognition and converting speech to text, OCR will become a more common feature within mainstream cloud software.
What humans will do: Risk management
Financial administrators will become more focused on reporting financial projections in the form of liquidity and cash flow. They’ll advise SMB owners on the structure of their cash flows and how viable different investments are.
The role: Payroll managers manage and compile payroll and employee information. This involves completing reports, maintaining records, designing systems, and tracking federal/state compliance changes.
What machines will do: Taxes
The verdict is in: Automation exceeds humans when it comes to tax filing. Some companies that use tax automation software reported decreasing the time they spend managing sales tax by 50 percent. This included reducing time spent on some tasks from 20 hours per task down to one hour!
What humans will do: Treasury
Payroll managers will ensure that small business owners correctly invest their excess cash. They will also need to keep external stakeholders informed about the SMB’s financials. This includes liaising with credit rating agencies, banks, and customers who need credit issued back to them.