Should We Use AI in Accounting? Applications, Benefits & Challenges

Artificial intelligence is rapidly changing how businesses handle their finances. From automating routine data entry to powering virtual assistants, AI tools promise to make accounting faster and more accurate. But adopting AI also introduces new challenges around security, oversight, and implementation. Below, we explore the main applications of AI in accounting, its benefits, and the considerations every business owner should weigh.

Applications of AI in Accounting

Automating Routine Data Entry

With AI tools, accountants can simplify routine data entry. Instead of typing data manually, they let software read and record financial information.

One notable example is AutoEntry, an AI-powered tool integrated into the accounting system Sage. AutoEntry uses ML-powered optical character recognition (OCR) to capture information from unstructured data like receipts, invoices, and bank and credit card statements. Then, it categorizes and publishes the information into connected bookkeeping software.

Similarly, AI-powered bookkeeping platform Zeni Accounting uses AI to automate manual bookkeeping tasks. It uses OCR to extract structured data from your invoices, then performs daily data entry into your books. It also uses AI to categorize transactions and complete bank reconciliations. This saves hours of repetitive work, reduces the risk of data entry errors, and keeps financial records up-to-date with minimal human intervention.

AI-Powered Virtual Assistants

AI-powered virtual assistants simplify accounting workflows by answering natural language queries. For example, SAP’s virtual assistant Joule lets users get answers or complete tasks by asking questions, such as “Which invoices are past due?” or “What’s our month-end close status?” The assistant pulls data from accounting systems, summarizes key insights, and then guides users through processes like report generation. This spares teams the manual effort of searching through dashboards, enabling greater focus on higher-value analysis tasks.

Bookkeeping software giant QuickBooks also developed a virtual assistant to support software workflows. The generative AI assistant Intuit Assist allows users to ask questions, summarize financial data, and complete accounting tasks through natural language queries. This helps users navigate the software more efficiently, speeding up in-app bookkeeping processes.

Security Considerations for AI Accounting Tools

Because AI accounting tools handle sensitive financial data, security should be a top priority when choosing a provider. Consider the following factors:

• Privacy policy details: Some companies will retain your data to improve personalization or train AI models. Check your provider’s privacy policy to determine what they use your data for and how long they intend to store it.
• Security certifications: These credentials show that third parties have validated the effectiveness of your provider’s security practices. Examples of security certifications include ISO 27001, SOC 2, or PCI DSS.
• Encryption standards: Check whether your provider’s encryption protocols meet industry standards. Common strong encryption protocols include AES-256, TLS, ChaCha20-Poly1305, and RSA.
• Authentication options: Many digital platforms offer authentication options to prevent unauthorized access. These include multi-factor authentication, biometric authentication, one-time passwords (OTPs), passkeys, and security keys.
• Access control granularity: If you intend to share control of your platform with other team members, such as bookkeepers, accountants, or employees, look for granular access controls that let you regulate exactly what each user can view and edit.

An Alternative to AI: Outsourcing Your Accounting

If you want to increase workflow efficiency without introducing the complexities and challenges that come with AI implementation, consider outsourcing accounting to third-party providers like freelancers, shared service centers, or bookkeeping firms. Professional accountants can help you offload the burden of financial management workloads, including tasks like bookkeeping, payroll, and compliance.

Outsourcing can improve accuracy, scalability, and cost savings without AI technology. It also shifts the responsibility for software updates, compliance, and error management to the service provider, which can be attractive for smaller firms or business owners without internal accounting expertise.

Many companies adopt hybrid approaches, combining traditional software, RPA, and human expertise instead of full AI deployment. This allows organizations to automate repetitive tasks while retaining professional oversight for tasks that require human judgment.

Let EpicBooks Handle the Complexity

AI can speed up routine bookkeeping, but it works best alongside professional oversight. If you’d rather skip the complexity of implementing and securing AI tools yourself, EpicBooks offers a simpler path. Our experts combine modern, time-saving technology with human judgment to deliver accurate books, insightful reports, and reliable financial management. Read the EpicBooks services page for more information.