Answers from business leaders are growing increasingly broad, with AI entrusted with anything from data collection and processing to identifying suitable candidates in the hiring process.

Without a doubt, AI is a time saver – with some estimates sitting as high as 40 per cent over completing a task manually – but what else is it?

As its role in the business landscape grows from a fringe concept to something like a leadership position, it’s important for business owners to understand the potential risks of AI and how they’ll need to mitigate them if they’re going to use it successfully in the long term.

An artificial sense of security

Contrary to sensationalist opinion, the current risks to businesses of AI are unlikely to be world-ending or lead to mass unemployment.

In fact, AI creates a real opportunity for innovative businesses to introduce time-saving measures which make them more efficient and offer clients a cost-effective, top-tier service – particularly in areas such as business operations, accounting, payroll and client administration.

However, this leads us onto the first major risk to businesses which embrace AI without proper planning and training – the skills gap.

The skills gap

Although AI in some form has existed for a while now, its use in business is generally new and evolving constantly, meaning that many talented professionals lack the necessary skills to effectively use an AI tool.

For example, using generative AI such as ChatGPT requires the user to know exactly what they need and how to ask the system for it, as well as common errors made by the programme.

This is easily solved but will require investment in training from firms seeking to innovate. Higher education may also play a role, with AI being incorporated into degree courses sought by AI-reliant industries.

In the meantime, such missing skills are a contributing factor to another difficulty brought about by using AI – accuracy and accountability.

Project tracking and fact checking

Although the capabilities of commercial AI systems are constantly growing, the fact remains that it isn’t perfect.

Many generative systems lack up-to-the-minute information even with the capacity to search the web, while others can easily misunderstand an instruction and pull through the wrong information.

This is particularly critical when dealing with client projects or financial information, where an error could create major loss of assets or trigger legal proceedings.

The reality is that the timesaving and automation capabilities of AI is limited when crucial information is involved, as it will need to be manually checked and verified.

This is also true beyond the scope of information and generative AI. While we may like to consider machine learning to be free of ‘human’ error, it is far from it. This feeds into the third major stumbling block for AI adoption, particularly in hiring practices and personnel decisions – unintended bias.

Machine-driven prejudice

I asked ChatGPT to write a description of a CEO of an accounting technology firm, five times over. On each iteration, it returned a description of a white man in his mid-40s.

While this may seem trivial, it is indicative of a well-documented phenomenon – bias sneaking its way into AI programming.

The major causes of this include programmer bias, conscious or unconscious, and machine learning based on online information. This means that historic prejudices, such as women leaders in business, and current majorities, find their way into AI representations of datasets.

This is most risky when used to HR and onboarding processes. Business owners open themselves up to accusations of discrimination and allowing bias to affect the hiring process.

Teams may also miss out on qualified candidates without certain keywords on their CV, for example.

Mitigating the risk

These are just some of the risks posed by AI to businesses and their owners.

However, there are many uses for it that can make your business run more smoothly and take on more work for sustainable growth.

Learning how to mitigate the risks is essential to successful AI integration.

You can do this through:

• Identifying the risks facing your specific sector
• Identifying whether each task or operation really requires AI
• Assigning staff to monitor work produced by AI systems
• Reviewing human and machine bias within the team
• Identifying the necessarily skills and investing in training

As with human workers and existing technologies, error cannot be fully eliminated from AI programmes, but with the right support, AI can make accountancy and other business operations more efficient and client-focused.

Our experts can guide you through how to identify the issues with AI facing your business and how to mitigate them within your business operations.

For more information on how we can support you, please get in touch with a member of our team.

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The short answer is yes, if set up correctly in consultation with the experts and tailored to meet your individual needs.

With businesses increasingly recognising the value of cloud-based accounting and a bespoke solution, AI is likely to take on a larger role at the forefront of accountancy and business operations – if properly understood and implemented.

The rapid pace of innovation in this space cannot be ignored, but developing effective services and strategies is still a continually developing process for both clients and firms alike.

How is AI being used in business and finance?

One in six UK businesses have adopted at least one piece of AI technology into their business structure, with a further 12 per cent either piloting or planning to adopt AI in the near future.

Of these pioneers, Government statistics find that nine per cent of UK companies have adopted AI for data management and analysis purposes, followed text generation and machine and process learning as the most popular uses of AI.

By sector, it’s no surprise that the legal, IT and finance industries are leading the charge, as professionals heavily reliant on large volumes of data, document templates and repetitive processes.

Nevertheless, a recent poll conducted by MyWorkpapers showed that adoption is still slow, with 28 per cent of accounting leaders surveyed saying that hadn’t even tried to use basic AI platforms, like ChatGPT.

Despite this, what we can see is that AI is being used as a tool to boost efficiency and free up more time for its operators to spend additional time on complex tasks.

The rise of cloud accounting

Offering a diverse range of benefits, cloud accounting is growing in popularity, but many firms are not optimising its efficiency – or seeking expert support with its implementation.

Beyond introducing a straightforward cloud-based system, cloud accounting experts can review your operations and identify where efficiencies can be introduced using an app stack.

This system of apps is a double-edged sword for the uninitiated.

Set up correctly, they can take your business operations, financial compliance and administration to a new level of efficiency.

With thousands of apps on the market, however, it’s easy to introduce a solution that doesn’t work for your business.

Cloud accountancy experts can offer independent, objective guidance on which app solutions will meet your needs and work seamlessly together as a system – as well as how AI can play a pivotal role.

Disrupting the traditional app stack

Increasingly popular and widely available, apps that use AI to support cloud accounting and business operations are changing the way we work.

Returning to how AI is currently being used, it’s clear that AI has significant potential in the fields of automation and process analysis.

AI integrations can automate and perform simple, repetitive tasks that may take up valuable time, with highly scalable solutions that can be rolled out swiftly across an organisation. In the world of accounting, these tasks include filing, sending and receiving invoices, collating data and outlining future plans based on past data and models.

Taking a step beyond that, certain AI integrations can also analyse data from business processes to identify new pathways that could simplify labour-intensive tasks, saving time and costs.

The future of AI in accounting

It’s clear that AI has a significant role to play in shaping the accounting sector.

With growing abilities to learn from data sets, spot patterns and react to issues that arise, AI is an incredibly useful tool that can be used to automate repetitive tasks and save time for work that cannot be automated.

However, business owners should also consider that each app stack and AI setup is unique to its user. Each business structure, product, service, team member and existing setup is different, so not all apps or AI integrations in the cloud will work for every business.

For this reason, it’s vital to engage fully with the experts, who can advise you on building an app stack that meets your business needs. This is also your prime opportunity to learn more about using AI in your cloud system and how to avoid the pitfalls associated with it.

Our experts can provide guidance on what app integrations will work well for you and where your business could benefit from AI and automation.

For more information on how we can support you, please get in touch with a member of our team.

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