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How Accounting Firms Use AI to Boost Efficiency and Client Services

How Accounting Firms Use AI to Boost Efficiency and Client Services

Alicia Shapiro
September 06, 2024 • Estimated Reading Time: 6 minutes

A modern accounting firm office featuring computer screens displaying AI-driven tools and financial data, such as tax documents, audit reports, and charts. Digital representations of AI technology, including neural networks and machine learning symbols, are seamlessly integrated with traditional accounting elements. The image symbolizes the balance between AI automation and human expertise in transforming accounting processes.

Image Source: ChatGPT-4o

How Accounting Firms Use AI to Boost Efficiency and Client Services

In today’s rapidly evolving business landscape, technology has become essential, and the accounting field is no exception. AI is transforming accounting firms by streamlining processes, improving accuracy, and enabling firms to deliver greater value to their clients. However, many firms remain cautious about integrating Generative AI (GenAI) into their workflows. According to the 2024 Generative AI in Professional Services Report by the Thomson Reuters Institute, 30% of tax and accounting firms are considering GenAI tools, while 49% have no immediate plans to adopt them.

The Current State of GenAI Adoption in Accounting Firms

As of the report, 8% of tax firms currently use GenAI technology, with 13% planning to implement it soon. While the overall adoption of AI in the accounting sector has grown, many firms are still exploring how best to incorporate GenAI into their operations. The benefits of AI—automating routine tasks, reducing errors, and freeing up accountants to focus on high-value advisory work—are clear, but firms continue to weigh the risks and rewards.

Interestingly, 27% of tax firms using GenAI have turned to open-source tools like ChatGPT, while only 8% are using industry-specific AI solutions. This trend may shift as more tailored GenAI tools enter the market in the coming years.

A bar chart displaying the organizational adoption of GenAI technology in tax firms. It shows that 8% of firms are already using GenAI, 13% are planning to use it, 30% are considering whether or not to use it, and 49% currently have no plans to adopt GenAI technology.

Image Source: Thomas Reuters 2024

A table comparing the use of open-source GenAI tools (like ChatGPT) versus industry-specific GenAI tools in tax firms. The table shows that 27% of firms already use open-source tools, while 8% use industry-specific tools. Additionally, 31% of firms have no plans to use open-source tools, and 30% have no plans to use industry-specific tools. The table also indicates future plans and uncertainties about GenAI adoption.

Image Source: Thomas Reuters 2024

How the Big 4 Accounting Firms Lead AI Adoption

The “Big 4” accounting firms—Deloitte, Ernst & Young (EY), PwC, and KPMG—have been at the forefront of AI integration, investing heavily in AI-powered tools to enhance their services. Here’s how they’re utilizing AI:

Document Review (Deloitte): Deloitte has developed an automated document review platform that uses AI to evaluate large numbers of contracts, helping practitioners quickly find key information.
Auditing (EY): EY incorporates AI into its audit process, using it to analyze unstructured data like contracts and large data sets, improving fraud detection and risk analysis.
IT and Development (PwC): PwC has developed in-house AI applications that improve productivity in development processes by 20% to 50%. They also offer employees and clients access to an enterprise version of ChatGPT-4o.
Client Solutions (KPMG): KPMG’s Trusted AI framework helps clients design and implement AI solutions responsibly, building loyalty and ensuring ethical AI use.

AI in Smaller Accounting Firms

Smaller accounting firms may not have the same resources as the Big 4, but they are also leveraging AI to stay competitive. According to the GenAI report, top AI use cases for tax firms include:

Accounting/Bookkeeping Automation: Automating tasks like expense categorization, account reconciliation, and financial report generation, reducing manual errors.
Tax Research: AI-powered algorithms quickly return authoritative tax data, improving the accuracy and efficiency of research.
Tax Return Preparation: AI automates data extraction and analysis from financial documents, making tax return preparation faster and more accurate.
Tax Advisory: Firms use AI tools to generate predictive insights, helping clients plan for future tax implications.
Document Review: AI summarizes key points in contracts and invoices, speeding up reviews and improving the accuracy of financial audits.

A horizontal chart listing the top 5 GenAI use cases in accounting and tax firms. The five categories are: 1) Accounting/Bookkeeping automation, 2) Tax research, 3) Tax return preparation, 4) Tax advisory, and 5) Document review.

Image Source: Thomas Reuters 2024

Daily AI Use Among Firms

Among the firms using GenAI, 42% report using the technology daily or multiple times a day, while another 31% use it weekly. AI is proving to be a valuable tool in enhancing efficiency and accuracy, enabling firms to offer better services to their clients.

AI in Accounting: A Powerful Opportunity

AI offers accounting firms, large and small, a unique opportunity to improve their operations and services. By embracing AI with curiosity and an open mind, firms can stay ahead of the competition and thrive in an evolving industry.

To learn more about AI in accounting, connect with the AI @ Thomson Reuters community, where you can explore the latest trends and unlock AI’s full potential. Read the full 2024 Generative AI in Professional Services Report.