How RPA is transforming the accounting industry
As automation in accounting grows in popularity, robotics process automation (RPA) in particular is making enormous strides due to its ability to reduce the burden of professionals’ repetitive activities. Due to the large number of transactional processes that are repeatable and rules-based, RPA is radically reshaping the way accounting professionals work.
Of specific interest to CPAs, a 2017 notice published by the AICPA (referencing McKinsey Research and Forrester studies) stated that “the RPA market is expected to grow $2.9 billion by 2021” within the accounting industry. These studies report that “40% of transactional accounting work is expected to be automated by 2020 (financial management) and [is] predicted to touch 230 million knowledge workers, 9% of the global workforce,” furthering RPA’s dramatic impact.
So, what is RPA and how can it help your accounting practice? Essentially, programmable software “bots” help accountants tackle the important but mundane, time-consuming tasks involved with both audit/attest and tax work. A bot works like an advanced Microsoft Excel macro that can function across multiple applications. But bots can handle a much larger volume of data than a typical macro, such as general-ledger or ERP work that requires a lot of manual data entry. RPA replaces these types of manual processes and does it quicker than the macros of yesteryear.
AI and robotics expert Byron Reese, author of The Fourth Age: Smart Robots, Conscious Computers, and the Future of Humanity, says “Artificial intelligence and robotics are poised to redefine what it means to be human.” Indeed, AI and RPA seek to eliminate those tedious, prolonged tasks performed by workers, and in turn, free up accountants and tax professionals to focus on higher-level accountancy work, and provide more value to the firm by leveraging their expertise to strengthen client relationships.
Why RPA matters
Accounting firms compete against one another for market share, so they must do two things to garner selection as the accounting firm of record: They have to be price-competitive, and they have to be compelling to clients. When accountants leverage RPA to handle much of their high-volume transaction processing, they can realize huge cost savings to the operational efficiency of the firm. Firms that are able to pass on that savings to its clients can win more business.
Unlike human employees, RPA has no work-hour limitations. Bots can run 24/7/365, increasing productivity to levels traditional work can’t achieve. Firm leaders appreciate the increase in productivity, which offers them a competitive advantage with clients.
Accountants are using RPA successfully today for a variety of tasks: accounts payable, accounts receivable, financial close, controller work, financial planning and analysis, expense management, and tax work.
Three keys to working with RPA
- Realize that humans must be part of the equation. Bots are not going to completely replace the accountant. Clients will always want and need expert financial and compliance advice. As many laborious, lower-level accounting tasks are replaced by RPA, accountants will be better able to focus on servicing clients for better satisfaction and retention, improving audit quality for the benefit of the investing public, increasing regulatory trust in the firm’s systems of service-delivery quality control, and improving engagement profitability for the financial benefit of the firm.
- Ensure your firm’s RPA technology is constantly evolving. Accounting automation began with simple Microsoft Excel macros and has evolved into bots that process routine tasks much more quickly. Technology will continue to be a valuable business resource that enables firms to provide the next level of service. RPA must also keep advancing because regulatory rules and guidelines will change, and RPA tasks will have to change with it.
- Understand that RPA is not a magic bullet. RPA is an extremely useful technology, but it is not a standalone solution to solve every problem. When paired with high-quality finance department analysis and workflow standardization before implementation, RPA can yield major benefits.
The RPA future continues to shine
Ultimately, robotic accounting results in reduced labor costs, shorter cycle times, increased accuracy, and simplified workflows. Although RPA is changing the face of accounting firms, it is important to remember that it will not eliminate human accountants. Because RPA reduces transactional data processing, accountants can focus on delivering higher-value financial analysis to help clients make better business decisions. Firm leaders will continue to focus on RPA solutions that keep up with the changing accounting landscape and serve as practical tools to manage repetitive tasks that cause operational inefficiencies.
Please visit intapp.com/accounting to learn more about exciting innovations revolutionizing the accounting industry.
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