AI is probably the hottest topic in tech right now. It’s such an overused buzzword that people are starting to roll their eyes every time they hear it. The two schools of thought seem to be, “AI isn’t accurate enough to take over”, or “AI will take our jobs in bookkeeping?”. So, which is it? Are we doomed? Will the robot overlords finally take over?

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A Look Back in History

“Microsoft Excel is going to take all of our jobs!” - Conspiracy Theorist circa 1985. This was similar to today's fear of AI for not only bookkeeping, but jobs in general. But what actually happened? Microsoft Excel is easily the most widely used tool in finance. It’s the backbone of accounting as we know it. It didn’t take jobs, it actually helped create jobs and make our lives easier.

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The optimistic outlook is the same. AI can be a powerful productivity tool that makes bookkeeping easier.

How Will AI Affect Bookkeeping?

We’re a long way away from AI completely taking over bookkeeping. However, bookkeepers who’s value consists mostly of reconciliation and data entry will likely be the first ones phased out. Bookkeepers have human judgment and that’s going to be hard to replicate. After the mundane tasks are automated, a human will still have to review the reports for accuracy.

Auto Categorization

Auto categorization is something we’re already starting to see. As time goes on it should be getting more and more accurate as well.

Data Entry

Mundane tasks like data entry are on the way out. Data entry is incredibly time consuming and labor intensive. AI uses techniques like computer vision, language processing and machine learning to automate data entry.

Real-time Data

With all of the time intensive tasks being automated, you’ll have real time data at your fingertips. It’s no longer necessary to wait on an employee to finish their data entry.

Error Reduction

Human data entry is highly susceptible to errors. AI helps reduce risk from mistakes like: duplicates, typos, spelling errors or missing records.

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Is there a bigger threat than AI to Bookkeeping?

A larger, less talked about threat to bookkeeping is outsourcing. According to CPAPracticeAdvisor.com, Boeing cut 150 US finance and accounting jobs and outsourced them to India.

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Countries like India and The Philippines are offering bookkeeping services for 60-70% the price of US bookkeepers. It’s often speculated that the quality is much lower, but one can see how these low prices can be tempting during economic downturns like we’re facing today.

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Will AI Take Over Bookkeeping?

Bookkeeping is definitely not over. If anything it should free up time and allow bookkeepers to step up and provide more value offering insights and recommendations. Although, low value bookkeeping does seem to be on the way out.

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Hopefully AI continues to offer more productivity and efficiency throughout our day to day lives. We might look back one day and think “how did we do this without AI?”