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.

 

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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

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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.

Is Financial Automation Gaining Speed in Accounting?

Automation continues to gain speed in the accounting industry. Automation simplifies menial tasks and reduces the risk of manual error, making it a huge boon for accountants as far as accuracy and data integrity. 

While tech greatly improves much of an accountant’s job, with this shift comes fear and uncertainty about job security. Embracing changing technology and learning to finetune strategic and advisory skills situates you to continue to be a player in the accounting sphere even as the ground shifts.

Accounts receivable automation platform Invoiced recently published new research on adopting financial automation technology. The study was fielded in November and December 2019. The study surveyed 459 U.S. finance and accounting professionals. 

Three big takeaways emerged from the report:

The report found that clients are coming to expect CPAs will deliver strategic, consultative services: Clients see that automation offloads many of the menial tasks that have historically been entwined with accounting. With more automation, billable hours would (theoretically) be reduced, leading to an expectation for increased expertise in strategy and consulting (or a reduction in price).

The report suggests that increased pressure will be put on CPAs to be tech-savvy: Businesses are expecting systems to integrate and tightly synchronize, and for CPAs to be aware of the ins and outs of it in order to deliver results and insights to clients.

The report highlights that challenges and opportunities are linked for CPAs as tech grows in accounting: It’s easy to get wrapped up in the pressure of a changing job in a changing industry. Accountants are expected to learn more and be flexible as the industry shifts, but many opportunities are shrouded in that challenge. For starters, taking the time and commitment to developing your tech skills will set you apart. Clients will also find you increasingly indispensable if you’re able to provide tech expertise and strategic and advisory services. And, though it isn’t always the case, increased skills could lead to a fatter paycheck.

Flexi can help you automate your accounting

Flexi’s comprehensive financial management software simplifies and automates the entire accounting workflow process without compromising security. Flexi’s open architecture meets even the most stringent security requirements yet allows data to flow seamlessly with any system, whenever and wherever business needs dictate. Learn more about Flexi today.

Why Process and Workflow Are So Important in Enterprise Accounting

Multi-entity accounting is complex, rendering process and workflow all the more important. Process, workflow, and a solid accounting software solution that is uniquely designed to handle the complex consolidation and reporting needs of multiple companies, divisions, or global entities is a necessity.

Some of the processes that plague enterprise accountants are: consolidations, intercompany postings, acquisitions, currencies, reporting, and auditing. With the right enterprise software, many of the problems that crop up regularly can be addressed swiftly:

  • Consolidations – Software can provide continuous close capabilities to allow the CFO to gain immediate views of consolidated financials and easily move through the soft close and period close processes.
  • Intercompany Postings – Automatically posting a transaction across multiple entities in a single screen ensures books for both “due to” and “due from” are always in balance.
  • Acquisitions – Newly acquired companies can be integrated faster with the right software that can rapidly clone company setups.
  • Currencies – When global operations are involved, financials can be easily viewed in local currency for field operations, or standardized into a single currency for headquarters purposes.
  • Reporting – Reporting and analysis benefits from real-time visibility with instant roll-up reporting or consolidations.
  • Auditing – With a tightly integrated platform, all transactional data, along with workflow documentation and approvals, are visible with a click of a button – right down to the journal entries.

Consolidating multiple companies, products, and/or divisions can add weeks of time to the financial close process, but it doesn’t have to. Industries that require you to quickly roll up reports or consolidate financials across multiple entities–like financial services, franchises, hospitality, logistics and transportation, property management, and building and construction–can benefit from a multi-entity software overhaul.

Flexi can overhaul your processes and workflows

Flexi’s software was built to perform, saving finance teams hours and weeks of time.

Flexi’s open architecture allows flexibility to choose stand-alone modules as business needs dictate. But enterprises will gain the ultimate speed and power with the entire financial management software platform, uniquely designed to allow financial data to flow securely wherever it is needed, with full integration into your other proprietary or third-party systems.

Submit your information and get a demo of the Flexi suite today. 

How AI & Automation Are Making Their Way to Accounting

Artificial intelligence (AI) and automation are making their way to accounting, just as they are permeating all other industries. AI is getting stronger and smarter as technology evolves, becoming not just an automator but also a smart technology that can learn and draw conclusions in real time.

As AI continues to advance, many fear it. While the perceived threat of job extinction looms, AI and automation can actually be extremely beneficial for accountants and finance professionals. By remaining adept and relevant in the industry, you are likely not to be replaced by robots anytime in the near future.

Working with AI and automation, not against it

Embracing advances in technology is key to remaining relevant in the industry.

AI and automation largely take the guesswork and possibility of manual error out of everyday processing. A large chunk of accounting tasks were at one time reliant on manual data entry, which meant manual mistakes. Automated, cloud-based software provides a level of security and data integrity previously unknown to accountants. These are all good things.

With increased accuracy and decreased time spent creating and running reports, accountants are left with time left in their day to devote to other, more strategic tasks. In fact an entire component of modern accounting relies on strategic and advisory services, and if your firm or organization has the time to devote to providing such services, you have an immediate edge over your competitors in the field.

While AI and automation reduces or eliminates many of the tasks historically known to the accounting role, AI and automation free up time for accountants to become subject matter experts on the various technologies and systems available today, providing a new level of value to clients.

Additionally, there are many elements in the financial industry that remain impermeable to AI and automation. A study cited by Business.com notes that 68 percent of clients surveyed prefer having access to a financial advisor over a technology offered as a replacement. This statistic makes it very clear that plenty of folks prefer the personal, human element when it comes to strategizing and problem solving. And fortunately, machines can’t replace that.

Flexi helps you embrace the future

Flexi provides software that automates many aspects of the accounting process, freeing up your time and making sure you can close the books and provide reports in a timely manner to boot. Flexi won’t replace you; Flexi will work with you.

Learn more about partnering with Flexi today. Call 800-353-9492.

Are New Accounting Rules Causing Chaos for Some Companies?

New accounting rules as of December are changing how companies account for revenue from services and sales. These changes were in the works for over a decade and situate the U.S. closer to international guidelines. For multi-entity and especially international companies, these changes can only benefit the bottom line and simplify accounting processes.

The new policies lead to an obvious change in how businesses conduct their operations so they remain compliant with current regulations. This also leads, in some cases, to increased expenses–upwards of $1 million for some–in the compliance measures.

One change with these regulations is that companies must more thoroughly account for costs related to sales, including discounts, marketing efforts, and more. This is understandably altering how some businesses provide and account for subscription-based sales. While some companies believe these regulations will ultimately increase their revenues, others aren’t so sure.

Some companies are communicating the new regulations with their investors to be transparent on how their finances may be affected in the future, while still others are opting to change their business operations wherever possible, rather than their expected revenue forecasts.

How Flexi keeps you compliant

At Flexi, we understand that regulations are always changing and evolving, and software should help keep you compliant no matter what industry your business operates within.

Through our secure, enterprise platform, Flexi automates the entire accounting workflow process and delivers ROI in months. As a result, your finance team can expect to spend far less time on the close, consolidation, and reporting processes and more time being strategic and proactive.

With Flexi, you won’t be stuck with a costly system that leaves you unable to adapt to changing market or business needs. Flexi offers extreme flexibility in every way, including flexibility with a changing marketplace and changing regulatory needs. From deployment options, implementation and setup of business rules, to integrations with other systems, Flexi has got you covered.

With Flexi, you can expect a complete audit trail and compliance documentation, among many other benefits. Flexi provides immediate access to all details behind a transaction. Because each accounting module is part of the same system (including our general ledger), you can easily drill down into all transactions and trace all the way back to the original journal entries, including a visual map of the workflow and approvals.

Learn more about Flexi’s solutions today. Call 800-353-9492.

Accounting Automation Software – Why Our Process Driven Solution Saves You Time

Flexi’s automated accounting solutions save your organization valuable time. Automated software means time added back to your calendar. With user-friendly, accessible software, clean and more accurate data, and simplified, easy-to-use report writers, accounting teams can work on strategizing, advisory, and new revenue streams with all the time they’ve bought back by using Flexi products.

Process-driven solutions

Flexi’s comprehensive financial management software simplifies and automates the entire accounting workflow process, without compromising security. Flexi’s open architecture meets even the most stringent security requirements yet allows data to flow seamlessly with any system, whenever and wherever business needs dictate.

Flexi delivers all the rich features you’d expect in a top tier accounting solution, but without the high cost. With quick implementation that can be deployed on-premises, in the cloud or in a hybrid environment, Flexi will not only simplify your accounting processes today, but also will have you ready to adapt quickly to market or business changes in your future.

Flexi allows you to:

  • Consolidate your company financials in real-time
  • Convert multi-currencies into a common currency
  • Pull data from different GLs into a standard format
  • Generate reports with just a few simple clicks
  • Distribute hundreds or thousands of reports with complete confidence
  • Answer all of your auditor’s questions

Industries

Flexi solutions enable companies in various industries to streamline accounting processes. These industries include:

Flex boasts flexible posting and open architecture, with rules-driven engines, enabling you to manage your accounting processes in a cost-effective and highly efficient manner.

Flexi software provides access to a fully integrated suite of applications, including general ledger, accounts payables, fixed assets, purchasing, and capital projects

As a Flexi user, you can save time with the added ability to analyze financial statements and track performance of your lines of business, profit centers, and locations.

Flexi solutions enable your organization to successfully compete in its dynamic and volatile marketplace. Automate and streamline your financial processes with the tools and controls to support complex regulatory requirements and changing market demands.

How can Flexi work for you?

Flexi may be the biggest, most trusted accounting software company in the industry right now. While Flexi sells directly to customers, Flexi’s software is also private labeled throughout the world by companies such as McKesson, StoneRiver, MajescoMastek, and Molina Healthcare.

To date, Flexi has 20,000+ users. Flexi’s automated software is process-driven and can help you and your business save–and repurpose–your time.

Learn more about Flexi accounting software solutions, or call 800-353-9492 to set up a demo today.