A recent article from Fortune reported a shortage of around 340,000 accountants in the US as of March 2024. Many large corporations’ recent quarterly earnings statements contained errors, and while we don’t really know if a shortage of accountants is to blame, it’s certainly a factor to consider.
A lack of accounting staff may lead to overwork, which means a potentially greater margin for error due to longer working hours and having to balance multiple roles at once. Down the road, this could mean higher turnover rates.
A shortage of accounting staff also means more job openings—but research shows that fewer and fewer college students have been majoring in accounting over the past several years. This could be attributed to many things: increased tuition, student loans for the extra year of school required to become a CPA, declining interest in accounting, the lack of perceived social impact, etc.
Regardless, organizations need accurate and effective accounting processes to retain stakeholders and employees, increase revenue, meet customer needs, and generally operate as a successful company.
By leveraging artificial intelligence, the accounting profession can address major issues, like financial statement errors, the accountant shortage, the declining interest in accounting careers among younger generations, and the challenges associated with the education/certification process. AI has the potential to enhance the accuracy and efficiency of accounting practices and make the profession more attractive and accessible to a broader pool of talent.
How AI can help organizations address the challenges associated with the CPA shortage:
1. Automating tasks – AI can automate routine and time-consuming tasks to alleviate workloads, allowing accountants to focus on what cannot yet be done with AI. This shift can help mitigate the effects of an accountant shortage by giving existing staff their time back.
2. Strategic hiring and compensation - Companies may need to reconsider their hiring strategies and compensation packages to attract talent in an AI-augmented accounting landscape. This could include offering roles that leverage AI skills, providing ongoing training in new technologies, and reevaluating the need for traditional credentials in favor of demonstrated competencies in AI and accounting software.
3. Overall strategy - Consider how AI can be used to parse the organization’s financial trends and economic forecasts to identify where strategic challenges should be assessed. Determine how AI can help finance align the overall strategic plan with financial objectives, corporate structure, working capital, and funding.
How AI can help identify and reduce accounting errors in financial reporting:
1. Enhancing accuracy and reducing errors – By automating routine tasks, AI can help reduce error or double check work to create more accurate financial reports. AI algorithms can help identify inconsistencies or deviations from expected financial norms.
2. Predictive analysis – AI can provide insight into trends by analyzing large amounts of data quickly. Predictions can help accountants focus review efforts where errors are most likely to occur. They can also help with financial planning and risk management.
How AI can help address education and certification challenges associated with the accounting profession:
1. Revolutionizing accounting education – AI tools can provide more interactive and personalized learning experiences that incorporate real-world scenarios. There’s potential for students to gain hands-on experience with AI to bridge the practical experience gap. Perhaps this could integrate more practical experience into the standard education timeline and alleviate an accountant shortage in the long-run.
2. Continuous learning and adaptation - Both students and professionals in the accounting field need to adopt a mindset of continuous learning to keep up with technological advancements. AI can help with deeper learning and staying up to date with accounting and controls practices.
How organizations can attract and retain accounting talent:
1. Highlighting the role of tech in accounting - Emphasizing the integration of AI and other technologies into accounting roles can make the profession more appealing to tech-savvy individuals. Showcasing how AI can elevate the accountant's role from repetitive tasks to more analytical and advisory functions can attract individuals interested in technology and innovation.
2. Addressing education cost concerns - AI can also play a role in creating more efficient pathways to certification. For example, AI-driven platforms could offer alternative credentialing mechanisms or support programs, making the career path more accessible financially.
As accounting adapts to incorporate AI, the role of accountants will evolve to hopefully emphasize more strategic, advisory, and analytical skills to attract new talent. However, implementing AI requires thorough planning and a robust strategy. We would love to share how we’ve helped finance organizations achieve success through automation and how we can help your organization do the same. Email us anytime at info@trenegy.com.
