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A significant proportion of the members of the workforce in different professions, industries, and countries are more or less concerned with whether their jobs could be fully or partially replaced by AI. For that reason, researchers from different disciplines are dedicating their efforts to understand to what extent can Artificial intelligence perform some tasks and identify the capabilities of AI in specific areas.
In Accounting, an area that might be falsely thought to be only mechanical is extremely vulnerable as a function to be replaced by AI as there have been several studies investigating the ability of AI to perform some specific tasks and these efforts will continue for several years to fully understand the changes that are going to take place as long as AI and language models are in a developmental stage which is the case now. Read more about Artificial intelligence in accounting here.
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Artificial intelligence in accounting
Matthias Mahlendorf, Professor of Accounting at Frankfurt School of Finance and Management, describes the ability of ChatGPT to conduct some specific accounting tasks based on the results of academic studies investigating the ability of ChatGPT. The article (in German) can be found here.
According to various studies, ChatGPT has the ability to perform very well in the ethical assessment of accounting practices, but only in relation to a code of conduct. ChatGPT is generally good at generating some ideas to increase profitability, identifying global risks, summarizing reports, identifying duplicate accounting records, generating a simple cash flow statement from Excel data, and calculating the break-even point for one product.
Upon analyzing these areas, it becomes quite obvious that we are still years far from the idea of replacing human accountants with AI or language models. Ethical assessment in comparison to a code of conduct or summarizing reports is much less than what anyone expects from a human functioning in an accounting department in any entity.
On the other hand, there are multiple tasks in which ChatGPT is poorly performed, although we humans might have thought that such tasks would be extremely easy for AI.
The existing studies show that AI performs very badly in preparing income statements and balance sheets, transferring a variable costing format income statement to a contribution format income statement, recording journal entries, calculating cash flows for prolonged periods of time using Excel data, and determining the net present value.
So, if we want to assess the degree of mastery that AI might possess now in accounting, we can safely say that we do not expect AI to pass the exams of the first year of an accounting program in higher education.
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Final Words
We should be aware that this current status is not permanent and that AI tools are still in a developmental phase, but we should also be assured that there is always a way for humans to stay at the top of the game by identifying the skills that focus on human interaction and interpretation in any profession and maintain a high level of such skill sets in combination with the technical skills that could, one day, be mastered by AI. However, as humans, we always know the main human elements that enrich the human experience in any context and thus, we should build on that knowledge.
