How much time does your firm waste?
For most tax practitioners, the answer to “how much time does your firm waste” lies within their investment in technology.
For today’s accounting firms, advanced technology is no longer an option but a necessity. To keep pace in an increasingly competitive landscape, forward-looking firms are investing in artificial intelligence (AI) solutions to automate tax workflow, open up additional revenue streams, and better serve clients.
If your firm is considering an investment in tax technology, the time is now. The most successful accounting firms are making the investment today to optimize growth tomorrow. But how do you make the case for AI and maximize this revolutionary opportunity? Let’s take a look at how AI is transforming the way accountants work and why it will help shape the future of the profession.
The state of investing in technology for firms
Historically, accounting firms have been reactive in terms of adopting technology. However, as tax and accounting professionals begin to champion the benefits of AI-backed technology, more firms are approaching implementation from a proactive point of view. This change also requires a shift in mindset, one that focuses less on traditional compliance work and more on strategic advisory services.
According to the most recent Client Advisory Services (CAS) Benchmark Survey, advisory services practices have grown 16% with 72% of all respondents and 81% of top-performing firms expressing confidence that their pipeline shows opportunity for continued expansion. The survey also indicated that advisory practices are continuing to use technology to innovate and embrace new business models to maximize value for their staff and clients.
In addition, recent research from Thomson Reuters on generative AI (which centers around content creation) uncovered a mix of optimism and caution from legal and accounting professionals. Among respondents, 78% believe generative AI tools such as ChatGPT can enhance legal or accounting work, however, only 4% of respondents are currently using it within their operations, with an additional 5% planning to do so. Interestingly, tax and accounting firms are more open to the idea, with a 15% adoption or planned adoption rate.
From saving time to boosting productivity to increasing profitability, an investment in AI-backed technology is on the horizon for many firms. Let’s look at how it can support the lucrative shift to advisory services and unlock transformative benefits for accounting firms of all sizes.
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How to unlock the benefits of technology – especially artificial intelligence
While most firms use tax technology in some form to standardize tax inputs and streamline workflow processes, the next level of optimization comes in the form of tax preparation automation alongside real-time insights and personalized advice. For example, 1040 workflow automation frees up valuable time for strategic activities while providing insightful information, thus enhancing overall productivity and elevating client service.
Perhaps one of the most significant advantages of AI is its ability to identify patterns in large data sets. From an audit perspective, this enables accountants to analyze massive amounts of data and quickly identify anomalies and outliers. This supports a shift away from sampling and instead opens up an opportunity to review all of a client’s transactions in real-time. With the ability to better identify risky transactions and deliver higher-quality audits, AI is a game-changer for audit practices.
From a client advisory standpoint, AI provides more accurate data for customized analysis and forecasting. This allows firms to stay ahead of ever-changing tax regulations and shifting market conditions. With powerful AI-backed algorithms and predictive analytics, accountants can gain meaningful insights into client behavior and develop strategies tailored to each client’s individual needs
From a tax research perspective, AI offers in-context answers which can empower even junior staff members to handle complex returns and answer complicated client questions quickly and confidently. AI-powered tax research tools can make this vision a reality with targeted search results built on sophisticated algorithms, editorial insight, and trusted sources (i.e., IRS.gov). Altogether, AI can position your firm as a tax expert no matter the topic
How to maximize your investment in technology
While the benefits are clear, shoring up the money and support to invest in an AI-powered tax solution can often be a challenge. To make your case, consider your firm’s strategic vision and lay out your goals, risks, and roadblocks.
From process efficiency to opening up revenue streams (i.e., value pricing), advanced technology can help your firm reach new heights in terms of profitability, client retention, and staff satisfaction. Consider making a side-by-side comparison between your firm’s current processes and the efficiencies gained with AI-backed technology. You can even work together with your tax technology provider to understand and estimate the potential for time and cost savings.
As with any business case, compile the overall cost of the technology and determine the ROI. Remember to incorporate quantifiable data using estimates where possible. And because technology changes quickly, it’s also important to ensure that your tax technology provider future-proofs offerings with continual updates and added features and functionality on a regular basis
It’s time to make AI work for you
By automating tax workflow and freeing up time for more value-added activities, AI can help accounting firms rise above the competition and ensure success in a rapidly changing landscape.
Using AI tools built for the profession, accountants can move away from tedious compliance work toward more profitable and strategic advisory services. With access to real-time data, an investment in AI technology can help you predict future trends and create insightful strategies for clients that align with current market conditions
If your firm is ready to make AI work for you, join the Thomson Reuters AI community and receive early access to insights, updates, and much more.
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