The Impact of AI in the accounting field. History of AI in Accounting

The Impact of AI in the Accounting Field
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The Impact of AI in the Accounting Field
Introduction
The success of companies is pegged in their book keeping abilities with accountants and auditors playing significant roles in this respect. Business accountancy is responsible for keeping accurate and updated business records. Additionally, business accounting is critical in the analysis of a company’s financial operations that is helps the management in making better business decisions more proficiently. The field of accounting continues to experience technological disruptions with companies adopting new and efficient accounting systems. The accounting field was first based on ledgers and paper journals until fast, and efficient computerized accounting systems were developed replacing the traditional accounting processes. Fast forward, organizations are now adopting artificial intelligence (AI) in their accounting processes which are not only fast and efficient but also accurate. AI has become instrumental in improving the quality of accounting processes as well as mitigating various challenges associated with traditional accounting systems.
History of AI in Accounting
AI technology has more than 20 years of applications in financial repowering and auditing with an increasing number of firms adopting the technology including accounting and auditing firms. A research that was conducted by the University of Oxford in 2015 indicated that the accounting field is among the fields expected to experience the greatest change in their jobs with accountants having a 95% chance of losing their jobs to AI technology (Griffin, 2016). The accounting field, however, used ledgers and journals to record financial transactions prior to computer technology. The ‘80s and ‘90s saw an increase in accounting computerization as a means of increasing speed and efficiency. Digitization of accounting processes simplified the distribution of financial data as well as save costs that went too hard copy printing (Boylan and Boylan, 2017).
Accounting embraced manual computer typing in the ’90s using computer software that eased writing and calculations which were more cumbersome and time-consuming (Frey & Osborne, 2017). The need for efficiency, accuracy, and speed necessitated the incorporation expert systems into accounting processes thus marking the debut of AI in accounting.
Some of the challenges that pushed for the adoption the AI technology in the early 1990s include:
* Accounting information unable to provide satisfactory information to decision makers:
Traditional accounting systems including computerized accounting database systems did not provide adequate accounting information with output such as productivity and reliability of data becoming biased due to data exaggeration O'Leary, 1991). Such information is unreliable in making management decisions.
* Complex computerized accounting database systems
The traditional computerized accounting database systems had complex output while churning out primary output models such as cash flow statements, balance sheet and income statements (O'leary, 1991). The summary output of these important primary models was c...