july2021 - 21

FEATURE
AI's Growing Influence Over CPA Services
By Ernie Villany, CPA
THERE'S NO GETTING around the changes that inevitably come with
technological advances, and the accounting profession isn't immune to
the coming transformations. We need to address what's happening with
the emergence of Artificial Intelligence in the accounting profession, the
repercussions, and how firms are adapting.
AI'S INFLUENCE ON THE PROFESSION
We've come a long way from the antisocial CPA
stereotype, behind a desk stacked high with documents
and dusty coffee-stained ledgers. But shiny
new calculators and a new wave of automated
systems are taking over. The stack of documents
is replaced with zip files transferred electronically
and the general ledger is maintained and updated
using electronic data extraction tools.
With the implementation of AI, time spent
number crunching is all but over for most
accountants. Intuit QuickBooks, Xero, and other
automation tools are eliminating repetitive tasks
and routine decisions. Technology has advanced
to the point where software can process almost
100% of the tax return before a CPA even lays
eyes on it. AI has its grip on the profession, and
its influence will continue to grow.
PROS AND CONS
With change to any industry comes new opportunities
and threats. How you and your firm
navigate the pros and cons of innovation will
ultimately determine your success:
PROS
Most accountants agree they'd rather spend time
elsewhere when it comes to the more mundane
tasks of the job. Thanks to AI, we can now
dedicate time to more meaningful work. The commoditization
of compliance work will give CPAs
time to dig deeper in understanding a particular
clients' needs, communicate more effectively,
and deliver information that helps them grow
their business. With bookkeeping managed by
automated systems, there's now room to provide
higher-value services and increased opportunities
for professionals who possess soft skills, such as
strong communication. Those who have these
skills can use it to their advantage, translating the
complex areas of a clients' return into something
digestible that can be used proactively to create
actionable items and achievable goals.
CONS
The thought of losing your job to automation is a
frightening one, but there's no immediate threat
to those who choose to adapt early. Your risk will
be determined by your response to change.
With new technology making certain job
functions obsolete, some job loss is a given. Juniorlevel
staff are particularly at risk, as programs
like QuickBooks eliminate basic bookkeeping
and accounting needs. This shift has created a
strong demand for qualified candidates who fit
the new requirements. In an already challenging
recruiting environment, identifying candidates
who can adapt to change, embrace AI, and provide
advisory level services has become increasingly
difficult. And the elimination of basic bookkeeping
skills has shrunk revenue from services that
were once considered accounting's bread and
butter. To compensate, accountants now have
to focus more time and energy on selling their
services as advisors and experts in tax strategies.
The flip side of lost revenue from shrinking
services is decreased costs, especially labor, but
the high demand for qualified CPAs has also significantly
increased salary levels. Many firms are
now leveraging third-party solutions to quickly
and cost-effectively process large amounts of
tedious technical data-creating pathways and
efficiencies that didn't exist before. AI is not only
helping to save time and money, but it's also
instrumental in aiding business owners to gather
data and analytics, creating efficiencies such as:
* improved customer satisfaction
* a reduction in collection times
* increasing cash flow
* operational process improvement
* cost cutting
In short, AI is optimizing the use of capital,
assessing, and providing insights that slash debt,
build cash reserves, and make smart decisions
about investments in technology and people.
If AI and automation are the fuel used to
drive the revolution, cloud technology (CT) is
the rocket ship. CT is giving CPAs unprecedented
opportunities to increase speed, access, and
integration. Software such as CCH Axcess offers
seamless integration of CRM, time and billing,
document management, tax preparation,
accounting, fixed asset management, workflow,
and communication.
HOW WILL AI AFFECT THE FUTURE
OF YOUR FIRM?
There's no need to change your profession overnight
and the robots aren't coming to take your
job. However, you may need to prepare yourself
to move your firm in a new direction.
Take advantage of the opportunities AI presents,
beginning with time saved by automation.
Utilize the surplus by highlighting tax planning
and strategic services for your clients. AI isn't
capable of giving comprehensive feedback, and
your clients need direction that a software
system simply cannot provide. Tax planning is
the jumping-off point for value-based services
that could potentially save your clients big money
in the long run. Shifting the focus presents the
opportunity to re-evaluate your pricing structure,
optimally towards value-based service and away
from hourly rates. Consider adopting a tiered pricing
structure, incentivizing clients to choose a
higher tier with more value.
The ultimate change will come in the way
clients choose their CPAs/advisors, as they'll be
looking for firms with specific core competencies
and an ability to understand their unique set of
needs. The new bread and butter for CPAs will be
substantive connections, as we shift from numbercrunchers
to strategy and planning experts. ■
Ernie Villany, CPA is the founder and president of
Boulder Valley CPA (BVCPA), a Colorado-based CPA/
advisory firm representing clients in 30 states. Ernie has
over 20 years of experience in public accounting, helping
small to medium-size businesses around the world plan
and manage their financial growth, while mitigating tax
liabilities.
JULY 2021 ■ www.CPAPracticeAdvisor.com
21
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july2021

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