It feels recently as if I could devote this blog entirely to AI-related developments…

…as if every new entry might anxiously immerse itself in the tussle of risk and opportunity, hopelessly trying to parse the significance of the latest piece of AI-related news or commentary (and there’s never a day without something new to chew on). The Street recently put together a grim outlook:

• Earlier this year, KPMG threatened to drop its own auditor if it didn’t pass along savings from its use of AI tools. It successfully pestered Grant Thornton to give it a 14% discount on those services.
• If KPMG assumed that it would be the only firm to do such a thing, they are sorely mistaken. If their auditor isn’t special, then it stands to reason they aren’t either. That’s a slippery slope for firms. It’s also completely self-inflicted, because everybody knows that the Big Four is using AI.
• Firms now know to ask for a discount because of the use of the tools, which means firms will be in the precarious position of trying to diversify their existing revenue with new, purpose-built tools.
• And if they’re wrong, they will still be labor-intensive organizations, agreeing to make less money, even if their capital investments in technology work out.
• Instead of enriching or complimenting existing work, it is possible that these moves just turn the field into a race to the bottom.

The bottom of what, one wonders. Less gloomily, the most recent issue of ThinkTwenty20 magazine was largely devoted to AI, informing us along the way that “the global AI-in-accounting market continues to grow at a projected CAGR (Compound Annual Growth Rate) of over 41% through 2029,” An interview with Liv A. Watson, a Senior Fellow at the Data Foundation, concisely sets out some prevailing uncertainties:

• The obvious benefit is that it frees accountants to actually do the work we’re trained for. Most of us didn’t go to school dreaming about coding invoices or chasing down mismatched entries. When AI handles those routine tasks, it gives professionals more time to focus on analysis, judgment and the bigger-picture thinking that really adds value.
• But I also think we need to talk about the flip side. Those repetitive tasks have traditionally been where new accountants cut their teeth. That early-career grind – learning the basics, understanding how transactions flow, getting a feel for the numbers – that’s how many of us built our foundation. If AI takes over all of that, we risk losing an important part of the training pipeline. My worry is that the profession could drift toward being “AI-dependent” instead of “AI-intelligent”…
• So, yes, there are real benefits with more efficiency, more time for meaningful work, fewer late nights doing manual tasks. But we also have to be intentional about how we train and develop young professionals in an AI-driven environment. The technology should elevate the profession, not hollow out the skills that make accountants trusted experts.

The aforementioned article from The Street foresees though that the accountant shortage will only get worse, as AI adds to the existing mix of pressures. It concludes: “It’s a problem that is getting worse, with no sign of improvement. Truthfully, it’s unlikely to get much better absent higher salaries and better benefits. Or, most controversially, a relaxing of education requirements for accounting jobs — which is sure to be a slap in the face to many career accountants who worked hard for their credit hours and those three letters behind their name.”

Well, there’ll certainly be a shift, if not an overall relaxing: however many accountants can currently reel off even scattered IFRS handbook references, we can sure there’ll be fewer of them in ten years’ time. But as Esra Klein reminds us in The New York Times:

• In 1979, VisiCalc, the first electronic spreadsheet, was released for the Apple II. It could do in minutes what previously took teams of accountants days. There were predictions of mass unemployment for bookkeepers. Instead, the number of accountants quadrupled over the next 40 years. “The spreadsheet didn’t replace the accountant,” Eldar Maksymov writes. “It unleashed latent demand for financial intelligence that had been there all along, waiting for costs to fall far enough to be satisfied.”
• …“In every major occupational group that adopted computers heavily, employment grew faster than in groups that did not,” he writes. “Computers eliminated specific tasks within jobs — but the resulting cost reductions created so much new demand that the occupations expanded overall.” Computers can do much that humans once did, but they didn’t put humans out of work. The ability to do more made people realize there was more to do.

This would be the “more meaningful” work cited above. But Klein also posits that “even as A.I. makes relational skills more valuable, it may make those skills rarer…Our ability to relate, sensitively and deeply, to other human beings (may) be a central and valuable skill. That, I fear, is the exact skill we are breaking down in the young.” How will the accountants of the future unlock the additional meaningfulness that AI perhaps makes possible, if their work and life experience, their basic ability to engage with possibility and complexity, isn’t up to the task? Maybe the answer is simply that they’ll generally fail, and that the profession will indeed decline in influence, credibility and lucrativeness, but I doubt too many of us would concede that point just yet…

The opinions expressed are solely those of the author.