The Future of AI and Accounting

In our continuation of the Flexi Education Series, we recently had the pleasure to sit down with Dmitry Trudov, President at Flexi Software. The purpose of the conversation was to talk about where accounting is in the grand scheme of emerging technologies such as AI, Machine Learning and RPA. We were most curious about what the next evolution might be in accounting, what are some of the current user trends, and what Dmitry’s view is from a 30,000-foot view level.


Q: Dmitry thanks for taking the time to speak with us. I know you are busy working on the next version of Flexi Software, but beyond that, what is keeping you up at night? Is it AI and machine learning? Business Intelligence? Workflow automation?

Dmitry Trudov: All the above. Some are still in a growth mode and others are a little more defined. In the end, it is all about the quest in understanding structured information and getting to the holy grail of accounting: anticipating, planning, and forecasting. Quite simply, the path forward needs to be based on historical data.

Q; So the reason why everyone is so hot on AI, automation and ML is to not only automate what is possible but also to have systems that can look at trends and make determinations. Trust the machines, essentially.

DT: Right. A machine’s understanding of the data is where we want to go. In other words, it will be much more informative and valuable for a user to see what the machine thinks about where the business is going to be a year from now. Historical data is invaluable.

From a real-world perspective, a lot of machine learning techniques are now being used by people in hedge funds. Before, they paid a lot of money for PhDs to come up with algorithms to simulate stock movements and predict the stock flows. Now, increasingly, they just write machine learning algorithms.

In addition, a lot of people talk about how they want to look at historical data better and how they want a better user experience. But there is a big difference between automation and intelligence. For example, when we want the machine to do the same thing every time like our existing process, that is RPA. And heaven forbid if there is an extra comma somewhere – that’ll mess everything up! My point is there is no intelligence there. There’s automation, but there’s not intelligence.

Q: Do you think the accounting industry, within the last three years, is finally wrapping its arms around RPA?  I feel like there is a lot of talk about accounting automation and AI but there hasn’t been a lot of advancements in it.

DT: Correct. Because it is not easy to write machine learning algorithms that add intelligence. There are not a lot of people who can do that today and whoever can develop that is spending their time not on accounting and finance but on banking, hedge funds and trading, because that’s where the money is. Eventually it will evolve, and we’ll get there.

Q: Do you think it’s moving quickly or is it at a snail’s pace

DT: I think it’s going to be slow because accountants aren’t what you call, early adopters. Believe it or not, a lot of accountants still print everything.

Q: Creatures of habit, right?

DT: Somewhat, but it is probably more about trust. Accountants do not trust computers, which is largely driven by the notion that all ERP systems have “some” problems. Although it is much more stable now, many still remember how it was 10 years ago. They still remember those times when everything crashed and burned and the only thing they had to rely on was something that they printed. And when a company’s finances are at stake, it’s not easy to build that level of trust.

Imagine, then, if we ask them to not only trust the fact that the computer can aggregate the numbers, but we also ask them to trust that the computer can make decisions on which journal entry to enter or what adjustment to make.

Q:  I know you have heard this, but it has been said that one of the biggest fears of accounting automation, and probably AI in the same breath, is that accountants are worried about losing their jobs. And the rebuttal is, ”no you’re not losing your job; you’re going to have more time to do more strategic activities” … Do you buy into that?

DT: Yes, absolutely. It’s just like when things went to the cloud, a lot of IT people were afraid of losing their job because they no longer had the server room to play in. But did they lose their job? No. They found much better jobs. If there is anything that an accountant needs to be afraid of, it’s not AI, it’s the fact that accounting is going to go the route of IT and it’s all going to be converted into some kind of services organization that just provides you with the service of doing your accounting.

Q: So, you’re saying accounting as a service?

DT: Yes. In fact, there’s research out there that says by 2030 accounting will be pretty much converted into a service rather than a department. Just like IT now mostly gets converted to cloud services.  The work is going to be done in what they call accounting factories. Right now, we’re seeing that trend. As an example, InfoSync is an accounting factory providing accounting services to over 8000 restaurants, and one of our clients. We realized early on that Flexi Software is actually a perfect platform for outsourcing companies (BPOs) to do just that, provide accounting services.

Q: When you say accounting factory, you are basically saying that somebody is outsourcing their accounting activities, right?

DT: Yes and no. There are the big firms that have practices around this, like Cognizant and Infosys. Outsourcing accounting is not a new concept, but what I’m talking about is slightly different. This is about transplanting your accountants into more strategic roles, and relying on accounting factories to take on the more traditional accounting functions that can be done much more efficiently with automation technology that would be cost prohibitive to build yourself. AI, for example, would require a huge investment to build and buy AI components to then load into an accounting system. So, if each individual company had to purchase that, it would be a pretty large investment and likely would not make sense for a company that is not focused on accounting. But for an accounting factory, this IS their focus and that high cost can be spread across multiple clients. And from an AI standpoint, AI does not care if it processes one invoice or ten or a million, it will do exactly the same thing. It will just be running and crunching this information, leveraging the same software.

Q: That’s interesting. This is a broad-based question but five years from now, what will be the impact of AI and automation in accounting? Are we going to be further along or are we still going to be just talking about it?

DT: AI is happening. Some of the machine learning is very easy to put in place. The question becomes though, how transformative will those things be? In reality, probably not that much because making things quicker and easier is not truly transformative.

When a software can really do something long term, like anticipating things that need to happen at the end of the quarter or the end of the year, offering up checklists of things you can anticipate and/or do right away, and sometimes even doing it for you, those sorts of things are really transformational. Because what an accountant does is they run a report, look at it and say, “Oh my goodness, I have to fix this and then re-run the report…” (sometimes over and over again) The AI is the software that would read the report for them and instinctively say, “oh, I need to fix this before I deliver this report.” When AI is at that level, and it has to get to that level, then we will have had a transformation.

Q: So, can we be there in five years?

DT: Well, when did they say that the singularity is going to happen? When computers will be as smart as a human? 2028 originally (but that  continues to be a moving target).

Q: Yes, a moving target! Dmitry, thank you so much for your time, this was really fascinating.

DT: You’re welcome.



Download our whitepaper, AI in Accounting and learn how accounting and finance organizations are being transformed by Artificial Intelligence. 


Flexi Makes List of Top Accounting Software for Small Businesses

Flexi is pleased to announce that it has made SoftwareWorld’s list of top Accounting Software (companies) for Small Businesses. In compiling the list, SoftwareWorld bases their selection criteria on user satisfaction (reviews & ratings), features & customizability, social media buzz, online presence, and other relevant information.

Flexi software has been one of the top accounting software companies in the world delivering impeccable accounting services to leading banks, insurance companies, thousands of hospitals, and global technology providers.

Flexi has been empowering accountants to work efficiently and securely as possible for over 30 years. Flexi has proven itself to be one of the most powerful accounting platforms to simplify complex business processes regardless of business size. Understanding various business requirements, Flexi helps in managing multi-entity books, frustrating audits, and stressful accounts. Equipped with a focus-driven approach that delivers tremendous benefits to manage financial aspects, Flexi Software has become one of the most-used accounting software platforms in the world. Flexi Software is an all-purpose cloud-based accounting software that can prove to be advantageous for the business both from cost standpoint as well as from a productivity point of view.

SoftwareWorld is a platform that showcases software companies and provides a collective review from the leading trusted review sites such as Capterra, G2crowd, and GetApp. SoftwareWorld provides start-up companies as well as prevailing and established businesses, the ability to evaluate their software needs as well as their clients, employees, and customers needs, and then map those needs back to the ratings provided by the SoftwareWorld of software companies that might fit. The website provides a collaborative review by categories of the software according to the individual business’s demands.

For three decades, Flexi’s accounting software has been put to the test in the most challenging environments where performance, security and speed are paramount. We bring a unique combination of a true enterprise solution with the built-in flexibility to adapt to any accounting environment. For more information on how Flexi’s accounting software can help take your organization to the next level of productivity, go here.

An Interview with Flexi CEO, Stefan R. Bothe

Words of wisdom from business leaders can sometimes fall flat and not resonate much, depending on the context and who is saying them. When most CEOs talk about their background, it’s usually filled with the requisite plaudits, accomplishments, awards and endorsements. But you’ll hear something much different from the CEO of Flexi Software in this interview. True to character, his focus is not on himself but rather on what he believes drives genuine success: people, passion, and product – in that order.

In a recent interview with The Connecticut Business & Industry Association, Stefan R. Bothe, co-founder and CEO of Flexi Software, recounts stories that have shaped his career and the lessons learned, including the early days when his younger self arrived in the United States determined to learn the English language and make a successful life for himself. 

As you listen to the full interview with Mr. Bothe, pay attention to his humility. Humble people share the credit and the wealth. While they remain focused and hungry to continue the journey of success, truly successful people are always quick to point out that they could not have accomplished anything without the help of others.

Mr. Bothe has learned over the years that whether it is in sales or marketing or software development, great people are the keys to a great company. In fact, when he is hiring people, he looks for potential on a resume and not necessarily experience or time spent at one particular company. “I don’t want someone who’s been doing the same thing for the last ten years. That’s someone who is set in their ways.”

He also said, “there is no straight road to success. There will be plenty of bumps along the way.” You need to be able to respond and react to those bumps. Mr. Bothe believes that it is okay to fail because often failure breeds success, but you must be able to pivot.

His message for those that are just starting out? “Take risks and have a plan. If it does not work, you adjust. But take risks.”

You can view the full interview below.

The accounting software of choice for credit unions

Flexi’s Star Continues to Rise in the Accounting Software Space

Supernova they are not! Flexi Software is a Rising Star according to The Spring 2021 Financial Close Management Software Customer Success Report!

In its most recent customer success report, Featured Customers, a leading customer reference platform for B2B business software & services, recognized Flexi International Software, aka Flexi, as a “Rising Star” in the Financial close management software space. For the uninitiated, FCM, or Financial close management software, or simply accounting close software, helps companies to complete the financial close process.

A Rising Star, according to the organization, is a vendor that understands where the market is going and has a disruptive technology. Rising Stars have been around long enough to establish momentum, a minimum amount of customer reference content along with a growing social media presence. This recognition is based on collected data from their customer reference platform, their market presence, their web presence, & social presence as well as additional data aggregated from online sources and media properties.

Flexi is an “on-prem” as well as a cloud-based accounting solution for the banking, insurance, healthcare, credit union and services industries. Flexi’s accounting solutions feature automation of accounting process and completion of audit trails which include a visual display of the audit workflow process, real-time visibility, analysis of financial reports and more.

Flexi’s software can save finance teams hours and weeks of time. With Flexi’s open architecture the flexibility to choose stand-alone modules as business needs dictate can happen at the drop of a hat. Find out how enterprises can gain the ultimate in speed and power with the entire financial management software platform, which is uniquely designed to allow financial data to flow securely wherever it is needed, with full integration into your other proprietary or third-party systems. Here is a link to the full article/PDF recognizing Flexi.

The Future of Accounting Automation in the Insurance Industry

Attention accountants. Just because you have an affinity towards numbers, you breezed through all your accounting classes and your books are always perfectly balanced, does not mean that your days of learning and adapting are over. In fact, for accountants to succeed currently, they are going to need to bring a bit more to the table than just an appetite.

In a recent eBook by Flexi Software on accounting automation in the insurance industry, the desire to hire more well-rounded and future-ready accountants appears to be on everyone’s radar to a certain extent. This does not necessarily mean automating everything and doing away with accountants or hiring fewer accountants. What it does mean is hiring accountants who are armed with more than just an ability to maintain the books. Accounting and finance leaders now need an accountancy that is fluid in nature, robust in skillsets and agile enough to scale

With no thanks to the pandemic, but certainly acknowledging its impact, we all have been forced to adapt to new ways of working, learning, and living. In turn, this historic and catastrophic event has also propelled the accounting profession towards unprecedented opportunities for accountants to becoming more of a valued change agent and strategic consultant and less of the antiquated notion of what an accountant “used” to be. Let’s be clear though – the accounting profession was already undergoing a digital transformation. The pandemic merely accelerated the timeline.  

However, with these opportunities come some unique and very real challenges; some of which have been swirling around the profession for decades, while others have only just recently bubbled up to the surface. Case in point: accounting automation. The reality is that technology is undoubtedly driving change in accountancy practices, and accounting automation is leading the charge. For example, consider Robotic Process Automation, or RPA. According to research firm Gartner, RPA could save finance teams 25,000 hours of avoidable rework from human errors, at a cost savings of $878,000.


The challenges for those at the forefront, though, are numerous and, in some cases steep, if not daunting.

As the Flexi eBook revealed, the increased productivity, as well as the time-saving aspect of automation, are just two of the main benefits of adopting some type of automation into the accounting mix. However, getting “there” still appears to be a primary challenge for a lot of organizations, particularly in the insurance industry. From deciding what accounting software should be employed, to determining what manual processes need to be, or can be, automated, none of these decisions happens in a vacuum. In fact, a 2020 global survey of business leaders from a fairly wide swath of industries conducted by McKinsey found that nearly 66% of respondents were piloting solutions to automate at least one business process, which was up nearly 10% from two years earlier. The bottom line was more companies were pursuing automation initiatives year over year.

However, there are still quite a few companies who are currently struggling with not only the destination aspect of automation, but also the journey itself. A lot of companies know exactly what they want to automate but finding the right technology partner who understands exactly what is needed for their organization can be somewhat challenging. Conversely, a lot of companies are ripe for automation but have no idea how to begin, and therefore will just continue to put it off until sometime in the future when the “timing is right.” Thus, the percentage of companies that have fully automated at least one function from the McKinsey survey is not as great as one might assume. It has grown more modestly, from 29% in 2018 to 31% in 2020.

In addition, a lack of accounting automation is now also impacting a company’s ability to attract and retain talent. As such, finance and accounting leaders, particularly in the insurance industry, are not only stuck with a current workforce who are fearful of losing their jobs to automation, but also challenged with hiring a future workforce that expects to have certain aspects of their job automated. A Catch-22 for sure. Factor in the desire to hire people who have more of a diverse skillset that is geared more towards an analytical and forward thinking nature, and not just bookkeeping, and the challenge becomes more real and pressing by the day.

The new world reality is this: tech-comfortable accountants that are capable of confidently making strategic decisions that can make or save a company a lot of money can now pick and choose where and who they want to work for.

As all the participants in the Flexi eBook have revealed to various degrees, prioritizing automation offers many different shades of the same color, and yet it is no less important for all of them in terms of working towards the same goal of enabling and achieving success, as hiring top-flight talent. If anything, successful organizations in the insurance space continue to focus on training-up current accounting staffs, as well as trying to hire the best and the brightest. In addition, the focus on newer technologies is not abating anytime soon either. Introducing new ways of empowering and leveraging those staffs to work alongside new technologies is critical to current and future success as well.

In closing, a common thread across all respondents in the Flexi eBook was that accounting automation was indeed a strategic priority. However, the renewed focus on hiring and developing people that can bring a diverse set of skills to the accounting function appears to be just as critical to the success of the organization, as does technologies such as AI, machine learning and, of course, automation. If companies can factor in developing an operating model that enables scaling, along with balancing the intense pressure to meet stakeholder expectations, enjoying a competitive advantage for years to come will no longer be a pipedream.

The Top Challenges for Accountants in Insurance Part I

In part 1 of our ongoing Flexi Education Series, we sit down and talk to Schuyler Ryan CPA, AIAF – Assistant Vice President, Finance at Union Mutual

Marc Meyer: Hi Schuyler thanks for jumping on a quick call to talk about all-things insurance and accounting. You ready to do this?

Schuyler Ryan: I am!

MM: What do you see as the top accounting challenge(s) for insurance companies?

SR: One of the challenges we face in the Accounting field is being stuck in the past which hinders us from looking toward the future. To some extent, this will never change as we cannot report financials on a period before the period ends. Our role as accountants is often looking in the rearview mirror.

As an example, while the calendar year changes, the accounting department does not turn the calendar until late in the first quarter. For the insurance industry, this is largely due to the annual statement filing deadline of March 1st and continued prior year related filings through June 1st. 

MM: Is this feeling that you are “stuck in the past” more of an accounting problem, or is it a process problem?

SR:  I would say it is a mix. The accounting part of it is just the nature of our role. You cannot report on a period until it is closed, for example you cannot report on 12/31 financials until 1/1 because you have to close all of that activity. But there is also a process piece to it.

MM: Can it be “fixed?”

SR:  There is certainly the opportunity to streamline our processes to close a financial period and complete required reporting more efficiently. By completing the close process sooner, we would have the opportunity to move on to the next period sooner. If we can move on to the next period sooner and have more real time information available, we would be better business partners to the rest of the Company.  

MM: From a process standpoint, are there ways to speed that up?

SR: Yes, for us, we work on trying to get our entries in by the 5th business day after the close of the month. This has been an improvement for us – just a couple of years ago this was a real struggle. However, we continue to work toward improved efficiency in our processes for financial closing and reporting.

One example where Flexi has helped us to implement process efficiencies is in the realm of invoice processing and accruing for invoices at period-end. Once invoices are entered in the system, they’re automatically being accrued in our financials without having to do a manual entry.

MM: That is a great lead-in to my next question. Because of the proliferation of new tools and technologies, is it safe to say that your job is getting easier?

SR: I would say new tools and technologies make some of the more run of the mill bookkeeping tasks easier and more efficient. Overall, as referenced previously, we’ve seen a lot of improvement particularly in some more of the basic areas like creating journal entries and entering/processing invoices.

The automated workflow within Flexi for invoice processing and approvals is a time saver as is the ability to copy and paste journal entries. However, there are still complex accounting processes that require the skills of an Accountant. Being able to streamline some of the more basic tasks have helped to free up members of the team to take on more complex tasks that help them to develop and grow professionally.

MM: There could never be too much automation, could there be?

SR: In general, I would say no. But it must be careful automation. You do not want to automate a process that has so many nuances that you end up spending more time correcting automation (that’s done incorrectly) than if you had just done it manually. The goal is to automate things in a way that is effective.

We’re not able to automate everything and I think it’s because of all those nuances, but if you can get it to a good place then I don’t think there can be too much automation if it’s working effectively.

MM: You talked earlier about your staff and how you want them to employ more critical thinking and problem-solving skills. From your standpoint, are they embracing that mindset?

SR: I am incredibly proud of how our accounting department has embraced this growth mindset. I really want people who are visionaries, who are innovative, and who are thinking about things like, “How can we streamline this process?  How can we help the company be the best that it can be?”

This has shifted over recent years and actually points back to an earlier interview on accounting automation that you did with Spencer Kuo in which he talked about that “bookkeeper mentality.” That mentality is gone. Accountants are no longer just “bean counters” anymore. We really need to be analytical and help the larger organization to make strategic decisions.

That transition of the person who wants to do the bookkeeping to someone who needs to be a problem solver is important. It’s critical to have a finance team full of critical thinkers and individuals who can embrace change and innovation.

MM: Do you think we are at the crossroads when it comes to the role of the accountant? When you interview new job candidates, do they know that is what you’re looking for? Do they realize the expectations in accounting have changed?

SR: That is a good question. I do think we are at the crossroads and we do need to make that shift. In terms of interviewing candidates, I am looking for someone who is a critical thinker, a problem solver, and who is not content with doing the same thing every day.

When you have these interviews and meet candidates, you can get a sense from people when you simply ask them, “What made you get into accounting?” Do they want to manage debits and credits, or do they want to think through and solve problems? There is a definite difference.

MM: That is an interesting question to ask because I would not even know what a typical response would be. But I guess it is safe to say that everyone gets in it for different reasons.

SR: When I first started in accounting, my thinking was, “I like the concept of everything balancing,” and that makes/made sense to me because accounting was very black and white. But now, it has really shifted to the fact that I feel like I am doing a different thing every day, I am forecasting, and I’m really thinking about how different decisions will impact the financials. So, my perspective has shifted for me throughout my career as I have learned that it is not so black and white after all.

MM: So, today’s accountant needs to be more well-rounded? Skilled?

SR: Skilled is a good way of phrasing it. Simply put, people must be smart. You cannot do this job by just following step-by-step instructions. I look for people who I know are going to be smart and who can think critically about the task at hand. I like members of the team to have diverse skills and backgrounds because they can challenge and encourage each other by offering different perspectives.

MM: Is it hard to find talent these days?

SR: Yes, it certainly can be. It is not as easy as you might think. Often, people see a job opening for an accountant and they think bookkeeper but that is not what I am looking for. There are more simplistic roles that are suitable for someone who fits into that role, so I don’t mean to discredit that. It is just that, for our team – in corporate accounting for insurance, for example – I am looking for someone who has a different skill set- analytical and forward-thinking.

MM: So, the notion of automation taking everyone’s jobs is not exactly happening anytime soon?

SR: No. 😊

MM: We are almost done. This has been great, by the way. So, challenge wise, what happens in the industry in five to ten years? Are we poised for a technical tsunami in which AI and automation just turn the industry upside down?

SR: When you say industry, are you speaking of Insurance or Accounting?

MM: Let’s make it a two-fold question then. Let’s talk first about accounting and then how accounting is affecting insurance.

SR: Got it. As far as AI and Automation, I do think they are both going to continue to shape the accounting field and again, it redefines the type of person you want to hire. Regarding what it means to the overall finance and accounting departments, if you can automate some of the more basic functions, we’re still going to have people working in accounting. It is just going to be different in terms of the problems we’re solving and the goals we’re trying to achieve.

In terms of insurance, it is probably not much different from other industries from an accounting perspective. But the insurance industry, as a whole, is seeing so much change in terms of automation and AI. When technology moves throughout the company it sort of pulls accounting along. So, when we’re automating other areas, it gets you thinking about how you can make these improvements in other departments. Accounting is no exception there.

MM: What’s on your wish list that could make your job easier?

SR: One of the reasons we implemented Flexi was to try and reduce our reliance on excel in our processes. I would like to see us continue to explore the capabilities of Flexi and optimizing it to reduce our reliance on Excel and improve our overall financial reporting structure. Any way that we can automate things that tend to be repetitive and that aren’t worth the brainpower of our team, I’m all for it.

MM: Schuyler, believe it or not, we are done! That went super quick. Thank you so much for your time. Have a great rest of your week!

SR: Thank you- you’re welcome!

The Top Challenges for Accountants in Insurance Part III

In Part III of our ongoing Flexi Education Series, we sit down and talk to Natalie Roberts Vice President – Accounting, Controller from Medical Mutual

Marc Meyer: Hi Natalie. Thanks for jumping on and agreeing to do this interview.

Natalie Roberts: No problem.

MM: Natalie, let’s just get right to it. What do you see as the top accounting challenge(s) for insurance companies?

NR: For us, our biggest accounting challenge is automation and remote working capabilities. The challenge really is all about getting it going or started. Broadly speaking, I look at the challenges in our industry not necessarily from a personal perspective but more from a broader picture. Automation is not only an accounting challenge but also one for the software vendors.

For example, over the last 12 months, the challenge was a little different. Our true challenge revolved around trying to figure out solutions for working from home. The primary reason was that we had certain people that absolutely had to come into the office to mail invoices, for example. Because of that experience, this year one of our corporate goals is to eliminate as many instances as possible that require someone to actually be “in the office.”

MM: That’s an interesting transformation, do you view that as more of a technology issue or a process issue?

NR: Both. It’s about our policy administration system, specifically the billing part which we have an in-house system for. Stepping back, we also realized that we had other issues (with both systems and processes) that we had to solve to enable our teams to work from home. COVID was the start of it, but we were already starting to think of all these other types of situations that might prevent us from being in the office. We had to solve for all of them.

MM: What about on-prem vs. cloud technology. Did that come into play for you at all?

NR: Well one of the biggest things we had just achieved was getting the general ledger and AP processing into the cloud. The timing of that could not have been better. If we had not have moved these processes to the cloud when we did, working from home during the pandemic would not have been possible.

MM: Let’s talk more about the challenges that you are facing and I’m not referring just to Flexi, but is the challenge based on the tools, systems and software that you are using?

NR: The challenge is really just finding a solution to our problem, and asking, “Is there a vendor that can do that?” For us, for example, getting AR invoices printed and mailed when working remotely was a big deal. Also, we print thousands of checks. There was no way that someone was going to print thousands of checks from home. So, because of the last 12 months, the incorporation of OCR technologies into workflow processing of Accounts Payable was a big transformation for us.

MM: So, the pandemic created a problem that you didn’t have before. Which was, working from home 24/7?

NR: Right, simply put, the availability of multiple means of paying invoices (and vendors) other than paper checks became the primary issue. Getting AR invoices printed and mailed when working remotely was the challenge. Factor in that “live” signatures were needed on the checks…we had to work that out as well.

MM: Sounds to me that the more processes that you could automate today, the better? That would be a welcome thing for you right?

NR: Absolutely. I’m all about making things more efficient.

MM: Are there manual processes that you do on a day-to-day basis that you would like to get off of your plate?

NR: Me personally? Not so much. My staff? Definitely. Take for example bank reconciliations and matching. There’s no reason why someone should be sitting there manually matching the general ledger activity back to the bank statement.

MM: I’m curious, Have newer technologies and data security issues affected your world? Like most of us, I imagine the insurance industry is no stranger to existential threats.

NR: We are very aware too. Our Board is very aware, we have a security governance committee that meets regularly. In addition, we do quarterly training as well as constant phishing-prevention campaigns. This security awareness is something that is constantly being discussed in our company.

MM: I get it. It’s crazy what we have to do these days on behalf of security. Let me ask you, Is the future of accounting in insurance bright? What do you predict for the future? What’s on your wish list?

NR: The biggest thing on my wish list is the OCR for AP. That’s probably the biggest, although another corporate goal for this year is to improve our database and query capabilities to help with financial analysis (primarily related to policy and claims data).

MM: Can you see a time where AI factors into what you currently do on a day-to-day basis?

NR: Absolutely and I think that works hand-in-hand with OCR capabilities: the invoice is read and the AI technology helps to determine what account it gets charged to. The insurance industry has traditionally been a laggard when it comes to adopting new technologies. But I see AI on the horizon.

MM: You’ve seen the evolution.

NR: It is something I’ve dealt with my whole career. I have been that person at the forefront trying to push to get new technology into the mix.

MM: That’s really cool to hear. Every company needs that champion of technology to drive transformational change. Natalie, I want to thank you for taking the time to sit down and talk with me today. I really appreciate it.

NR: My pleasure.

By the Numbers: The Impact of AI and Automation in Accounting

At Flexi Software, March is more than just Madness, it’s also Metrics Matter Month! What metrics are we focusing on? AI and automation to be specific. To be even more specific, we’re talking about how the two are going to impact the accounting industry. Let’s just get this out of the way. It’s a misconception, but a lot of people have been lead to believe that with more and more accounting operations being automated through AI and what not, companies will no longer need accountants in the future. It’s not true. What is true is that there is a lot of buzz out there that appears to indicate that accounting is getting ready to have a huge resurgence. In other words, right now might be the best time to be an accountant.

In fact, the appearance of AI in accounting shouldn’t be viewed at all like a threat, but rather as an opportunity to achieve better results in a quicker span of time. It’s a tool that will enhance the value of all accountants. Accounting already feels the powerful influence of workflow automation software. Factor artificial intelligence into the accounting mix? That’s the next wave and you’re just in time to catch it!

As you pour over the eye-opening facts and figures packed into this infographic, which you are free to share here, know that it paints a future bright with possibility and upside. Look no further than the data that projects the AI in accounting market to grow into a $4.7 Billion dollar behemoth by 2024.

There is no doubt that rapid change is on the horizon for accounting organizations, due in large part to automation and artificial intelligence (AI). If you would like to learn more about its impact, feel free to read Flexi software’s latest whitepaper on AI in accounting. Download our whitepaper and find out how accountants of the future are adopting this technology right now.

If you would like to learn more on why and how Flexi’s accounting software powers millions of end users around the globe. Look no further than our continually evolving technology, personalized support, and a commitment to meeting our customer’s ever-changing needs, Just like you! Click here to learn more.

The Top Challenges for Insurance Accountants Part II

In Part II of our ongoing Flexi Education Series, we sit down and talk to Michelle Lucero, Senior Accountant at New Mexico Mutual

Marc Meyer: Hi Michelle, thanks for taking the time to talk all things insurance and accounting, I really appreciate it.

Michelle Lucero: No problem

MM: How long have you been working at New Mexico Mutual?

ML: About 4.5 years.

MM: What’s one of your main challenges?

ML: Right now, my main challenge is that I do everything! We do not have a single focus such as AP or AR. We do it all.

We have ten companies, and we are responsible for the full close cycle of those companies, from beginning to end every month, quarter, and annual closing. Each of our accountants is responsible for at least two companies, sometimes up to four.

So, it is easy to say what our biggest challenge is, not just for me and my team but for the insurance industry as a whole and probably many industries. It is moving away from all the manual work and finding ways to automate our accounting!

MM: Would you say you are at the crossroads of manual processes and automation?

ML: Actually, we are at the very beginning. We are in talks now of how we can do it. With 150 employees, we are still a relatively small company. So unlike large companies that can more quickly “just do it,” we are at the beginning of discussions: what it looks like, how it can work for us, and how to implement.

MM: What about on a day-to-day level. What keeps you in the weeds? What are those things that come up every day that you cannot escape?

ML: Definitely manual processes, especially recons. I handle all of our bank account reconciliations, and everything is manual. As any accountant knows, reconciliations are extremely time consuming. With no automation behind it, it can be a very tedious process, like “copy the GL, paste it in here, and then manually compare your expenses against your bank data.

In addition to our big accounts, I also do all the benefit reconciliations too. And it’s pretty much the same process, including all the manual work.

MM: A couple of years ago I did some consulting work with a company in the RPA space. The ongoing concern or belief at the time was that RPA was going to eliminate jobs, but in your case, it sounds like automation would be a good thing for your company. Do you feel that way?

ML: I do. I agree with that. RPA and automation will provide opportunities for data analysis and enable us to actually look at the big picture. Right now, we can’t do that because we’re so busy looking at the small picture and the details of the constant manual work, we don’t have the time to look beyond that.

If anything, I think the bigger problem is that people are automated (robotic) in their thinking. When our thoughts are, “this is what I’ve got to do and this is why I’ve got to do it and this is when it’s got to be done,” there is nobody looking at the bigger things that matter more. So yes, there are a lot of opportunities for automation, not just in our processes but also changing mindsets.

MM: Ok, let’s talk more about the challenges. We discussed how adopting automation is a challenge for your company and probably many others. Are there any other (challenges) you face, for example, trying to juggle ten different companies? Is it trying to automate processes across the board?

ML: I think the challenges are one in the same. It’s the automation part for sure. But, because we have ten companies, our largeness mitigates a lot of problems that we might have.

One thing to keep in mind is that because we have ten companies, there is a lot of repetition in our accounting. We’re doing the same thing but for a different company, over and over again. It’s the same reports, just different numbers. Thus, if we had automation in place it would help exponentially. We could apply those time savings across all our companies!

MM: Interesting. So, after all is said and done, it does come down to automation as the main challenge. That’s awesome that you can identify it without doubt, or at least it is if you are going to do something about it.

ML: Right. But I also think the challenge of automation is that it deters other employees from wanting to learn the job. They don’t want to get down in the weeds and perform all this manual work.

For example, I’m going to be on maternity leave soon, so I am trying to teach somebody else the job and she doesn’t want to have anything to do with it because of the manual part of it. It scares her.

This is one of the hidden problems associated with NOT automating and continuing to do manual work. It can become a problem for companies in attracting new talent, especially with a younger generation and potential employees who are looking at a business as “all manual.”

MM: Chicken or the egg, right? Ok, so you got two questions left and you’re doing great! So, in your four years there, how have newer technologies and data security affected your world? What has changed from day one to now for you?

ML: Our reporting software. We used to use this really, old school software but that has changed for the better. That was a big change because it allowed us to reduce our manual work. Also moving to cloud-based services, like I know Flexi has one and we plan on utilizing that later this year when I get back from my leave. From a security standpoint, moving to cloud-based services is a great thing. It also allows our IT department to focus on other security issues.

MM: You know it’s interesting to see how cloud computing is rolling in like a fog into the accounting industry but there are still some on-prem hold-outs out there. But in the end, the cloud is the way to go. It’s pretty evident right?

ML: Yes, it frees up a lot of our servers and we spend a lot of money on servers. It’s even affected our AP function – we no longer use paper. Nobody is turning in paper anymore. Within my four years that’s been a big change. For example, I sit next to the AP Clerk and I used to see stacks of check requests but now we’re using Flexi Workflow and now everything is more automated and more organized, with much less room for error. It all really helps and that’s another automation perk that’s really beneficial.

MM: What’s on your wish list? What are you looking forward to when you come back from maternity leave?

ML: Ironically, I just got promoted last week and my boss mentioned that she wants me to drive the automation push. So, my first thing I want to do when I come back is move to Flexi’s cloud accounting software. That will be my first project.

After that, I want to work with our BA team so that we can look at where do we begin with the automation of our reports and possibly working with Flexi to see if we can do some type of accounting automation with our monthly entries. So those are my two biggies when I get back.

MM: How do you feel about AI?

ML: I’d welcome it, but I think we’re years away. Though I do think AI in accounting is applicable, or will be. You were talking about fraud earlier, I think that given that people are so in the weeds with work it’s easy for things to get overlooked or for people to game the system. So I think AI would be helpful in recognizing fraud. It would also again, allow people to focus on other things. So, it’s not taking jobs away but rather expanding knowledge and expanding the job.

MM: Two minutes left. What do you love about your job?

ML: My manager and my department. They are wonderful. Like, they’re awesome. I have a great team, great manager and great co-workers. I love that I’m given the opportunity to look for other ways of becoming more efficient and/or change things. They’re always open to new ideas. I love that I’m able to learn everything, it’s not just one section, my knowledge base increases constantly.

MM: You’ve been working from home since Covid hit?

ML: Yes and honestly, working from home has increased my productivity and my focus; no distractions. In fact, I’m amazed what I’ve done from home in a year versus what I could have done in the office.

MM: Michelle, we are done. I want to thank you for your time, your answers were awesome. Good luck on maternity leave and we will talk to you soon. Thank you so much.

ML: Thank you!

What is Accounting Automation?

Flexi Education Series

What is Accounting Automation? An interview with Spencer Kuo

In our inaugural post for our Flexi Education Series. We sat down with Spencer Kuo. Spencer is Vice President of Solution Consulting at Flexi Software. Recently, we had the pleasure of talking with Spencer about accounting automation and what the future holds for accountants and the accounting practice.

Marc Meyer: Thanks for taking the time to do this Spencer. Let’s jump right into it. What is Accounting Automation?

Spencer Kuo: Accounting automation is a broad category but it’s pretty much the same as any other “type” of automation. We simply want to reduce or replace manual processes that may take an accountant several steps with something that is more a computer can do for them, ultimately benefiting accountants by giving them back more time.  Accounting automation is something that continuously evolves over time, largely based on technology. In its most advanced form today, technologies like Artificial Intelligence are being deployed to help accountants make decisions and automate some of the data/and data analysis.

MM; It’s my understanding that accounting automation has evolved because you had certain processes that were repetitive, and so automating them was a natural progression (and easy transition) to automate them. Is that right?

SK: Certainly. Those repetitive tasks were easiest to automate as they are the low hanging fruit of accounting systems. Modern accounting systems can eliminate many of those routine, day-to-day tasks in accounting.

MM: Do you remember when this first happened? How long has accounting automation been “around”?

SK: Well, it’s always been around. There have been accounting automation systems but to different degrees. What automation was available 20 years ago is dwarfed by what was available 10 years ago by what’s available to today, and it’s just going to continue to evolve and improve up to a certain point.

MM: It sounds like the biggest benefit is that you’re reducing manual processes; you’re speeding up certain processes. Am I on the right path?

SK: Yes, there are several major benefits. One benefit is less manual labor so employees can be more productive. The second benefit is a reduction in mistakes or human error as there is less data entry. The system is doing it for me, so you have much more accurate financials.

Why does that matter? It all boils down to better analytics and reporting. So the goal of the accounting function, in terms of bookkeeping, is an effort to provide the data needed to make better decisions that will help the business be more successful, and reports that regulatory bodies need to ensure compliance. By automating the accounting – which ultimately leads to less errors and more accurate data – helps to fulfill these goals.

MM: One question everyone wonders: Are the days of an accountant numbered?

SK: No, on the contrary, it’s just that their roles have shifted from being heads down data entry people to more strategically focused functions that are working towards the strategic goals of the company. They have more time now and better data.

MM: Do you feel like accountants now, rather than just reporting the numbers, have become more like strategists?

SK: Absolutely. Back in the day, accountants were viewed “just” as bookkeepers. They were there to purely record the money and nothing more. The old way of “doing” accounting (and it still exists today) is the concept of what we call ROR or Record to Report: record a bunch of information and create reports. That is what the role of an accountant has been, and often continues to be. The future of accounting automation, though, is less about the recording and more analysis of the information.

We have concrete information to help put accountants at ease. I’ve interviewed some of our Flexi customers informally that have adopted some of our automation technology like Workflow, and I have asked them, “Now that you have implemented Flexi and you have all this automation, what has been the impact on the accounting staff? Were you able to reduce staff?”

The answer was no. Not only had they maintained their existing staff, but they have actually grown. But what has changed is the nature or type of hire that is sought after now versus a decade ago. They used to hire “bean counters” that were lower level data-entry people but now that has changed. So let’s say you had five people. Three would have been data entry, one would have managed them and the other might have been either a controller or a VP of finance. Now, you don’t have data entry people anymore, you have five people who are more data analysts, or business analysts with finance and accounting backgrounds. The number of accountants has not changed, but the skillsets have.

MM: Thus, the reality is that the role or job description of the accountant is pretty far removed from that of the “bean counter”. The core skills needed today are all about the data and being able to analyze that information and make data-based recommendations. Which has me believing that contrary to the fears that accountants’ days are numbered, the accountant is now more valuable than ever.

SK: Exactly. I would say that right now, today, accounting, technology and automation have reached this inflection point in which accounting is automated enough and the analytics and reporting is good enough to enable the accounting department to make that evolutionary shift from being just bean counters to being more of an analytical organization.

MM: Interesting. You mentioned AI earlier. Does automation have AI baked into it? Or is that something that is completely separate from this?

SK: While we’re in the early phases and you can see some of this in Flexi’s accounting software, continued AI advancement is actually the next evolution. Automation has always existed in various forms but AI is just another technology used to accomplish automation. Look to AI being very common as we move towards the next generation of accounting systems.

MM: Then RPA is just taking those manual accounting processes and letting a bot do them in order to free up an accountant to do more valuable activities right?

SK: Yes. We can think of it like this: more routine, repeatable tasks are for the robots whereas the more cognitive and less repetitive tasks are for the accountant.

MM: Interestingly enough, I’ve probably seen more articles about RPA eliminating accounting jobs more than anything else. I actually think RPA augments the functions of an accountant rather than eliminates them. You’ve been pretty adamant that RPA is not a deal killer for accounting.

SK: True. But I do see a deal killer out there for accountants though.

MM: Oooh, let’s hear it.

SK: I can see a shift towards outsourced accounting. Similar to what we’re seeing with HR. We’ve seen it with IT, we’ve seen it with Legal. So accounting is logically next in terms of back-office functions that companies are going to outsource. Honestly, if you want to achieve 100% automation of your accounting functions, then outsourcing it would be the next logical step. If we have decided that the role of the accountant is strictly as an analyst and less of a data-entry person, then the easiest way to do that, would be to outsource that portion.

MM: What industries does accounting automation fit best?

SK: It’s industry agnostic. Every industry needs it but those that are more regulated are the ones that would be most impacted. Anytime there are regulations that create complexity in accounting, then automation can have the biggest return. Financial Services comes to mind based on the amount of regulations.

MM: Insurance?

SK: Yes, banking, insurance, and financial services are pretty notable.

MM: There’s always a contrarian point of view. What do you see as the downside to accounting automation?

SK: Generally speaking there’s usually a trade-off between automation and flexibility. The more automated you make things, the less flexible they can be.

MM: What does that mean exactly?

SK; it just means that automation needs to be applied in the right places rather than trying to automate everything. You have to be judicious in where you’re applying the automation.

MM: We’re almost done here and you’ve already mentioned what you can see happening in the industry but automation aside, where do you see accounting in five years?

SK: I think you’ll see artificial intelligence being applied to accounting to help with decision support. Automation today is essentially rules based. Functionally speaking, AI will help in picking up processes that automation simply can’t do. So whereas automation follows the rules, AI will help to write the rules.

MM: Wow, so rather than AI making decisions based on the results, AI will create the rules of which the decisions will be made based on the results. That’s fascinating.

SK: That’s right. I’d say today, AI is being used more for suggestions. It’s not writing the rules and saying “I think this is what the rules should be but you tell me which way you want to go,” but eventually it will interpreting patterns and behaviors enough to figure it out and write the rules.

MM: Just to tie this conversation into a neat bow, Flexi is probably positioned really well in anticipating what’s coming next in terms of automation or AI, right?

SK: Absolutely. When Flexi was first developed, the technology was client-server, we were the first to do it, we were the first to foresee the need for multi-tenancy. We developed a Workflow solution way ahead of its time. Same with the rules-engine which was also way ahead of its time.

In fact some of the things that Flexi has developed were too far ahead of its time. The ideas were way forward thinking but the technology wasn’t widely available yet and the users weren’t ready for it. We’ve always been looking at what the next trend is and right now we’re looking at AI pretty hard.

MM: Spencer, unfortunately we’re at the top of the hour. I want to thank you for your time, this was really interesting and we probably could have gone longer, easily. Maybe next time we will. 


For more information on how Flexi software can help your company power through your accounting challenges, reach out to us 24/7. In the meantime, be on the lookout for our next installment of the Flexi Education Series.