Once upon a time not so long ago, when we heard the term Artificial Intelligence, most of our minds quickly pictured some futurist robot that had very little to do with us. However, what has happened over the last few years is that Artificial Intelligence, (AI)--or what many call machine learning--has arrived upon the business landscape.
If you are unfamiliar with exactly what AI is, let's clear that up. This article from Professor John McCarthy at Stanford University is in a Q & A format that will answer all of your questions about AI. However, to help you with the basic definition of AI below is the definition from the article:
"Q. What is artificial intelligence?
A. It is the science and engineering of making intelligent machines, especially intelligent computer programs. It is related to the similar task of using computers to understand human intelligence, but AI does not have to confine itself to methods that are biologically observable."
Of course, we could delve more into exactly what AI is and how it affects us and our world, but for the purposes of this blog post, we are going to direct the conversation toward how AI affects your accounting firm, especially when it comes to your auditing department.
The best way to learn something new is to see examples of how other people handled the issue successfully. If your accounting firm is on the cusp of implementing AI and you want a great example of how one accounting firm successfully handled this process, read this article from the Journal of Accountancy. The article is titled How We Successfully Implemented AI in Audit. It is the story of how one Maryland accounting firm began using AI in their audits.
The article is especially helpful because it goes through the thought process that led to the firm seeking a better auditing solution and arriving at AI as the answer. Here is a paragraph from that article:
"We recently implemented AI for auditing. The AI we use is machine learning where the machine has built-in algorithms that help it learn based on transactions it is fed. This software platform uses AI and various control points (benchmarks) to analyze the transactions in the general ledger and then puts those transactions into buckets: high risk, medium risk, or low risk. Previously, we would manually sample at random to figure out which transactions to review, which was less effective. AI is absolutely more comprehensive; it alerts us when things don't look right and tells us where to start and where our risk is going to be. It shows the risk at the transaction level."
For even more help setting up AI in the auditing department of your accounting firm, the following upcoming 2 free webinars should provide all the education and information you will need:
Be the Smartest Person in the Room. How AI Helps You Always Have the Right Answer--This free webinar presented by professionals at Thomas Reuters is coming up this Tuesday, Sept 24, 2019.
You’ll earn CPE and learn:
- What makes AI so critical to the future of landscape of tax and accounting firms' compliance — Hint: it’s changing the way you work
- How powerful platforms like Checkpoint Edge use AI to answer questions and conduct research
- What questions your peers have about AI and what your experts have to say in response.
Register for this free webinar by following this link.
The Convergence of Audit Methodology and Technology--This free webinar will be held on October 3, 2019, and will include Pete Bieghler, Senior Consultant, Tax Products – Learning at Thomson Reuters and Rachel Godwin, Shareholder at Hartmann, Blackmon, & Kilgore as they discuss how to apply technology in your audit methodology and workflow. You'll earn 1 CPE credit for participating in the live webcast.
After completion of this webcast, you should be able to:
- Identify ways to enhance your audit effectiveness and improve overall efficiency
- Understand how technology helps you link your risk assessment to your audit programs effectively
- Identify areas to apply data analytics in the audit process
- Execute on tips for how to get started with executing change in your practice
Follow this link to register for this valuable free webinar.
The Rules of Thumb blog from MoneyThumb feels confident that by using all of the information we have provided in this post you should have no problem implementing AI into your accounting firm's auditing process. Be sure to share this post with your accounting and auditing peers so that they too can take advantage of this awesome AI learning experience.
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