By Alex O.
A few weeks ago, I interviewed Jonathan, our tech lead, and Alex Dundas, one of our customer success managers. That conversation led to what is now two articles. Our first article, “Why do you work at Stamped?” was an introduction to our team.
This article continues the conversation and addresses how AI is changing audit and accounting. Here is what they had to say.
How do you see each other contributing to the vision of changing the year-end auditing process?
Jonathan (software engineer)
As the tech lead, I execute the vision. The team and I are creating the software that will support that vision. We see ourselves as the backbone of breathing that vision into life with our coding. Working on software that will decrease the year-end burden for accountants helped me realize how much work accountants have on their plates. This motivates me to develop better features for the app that will make their life easier. One of the goals the CTO, myself, and the entire tech team have for next year is to make a sizable difference in their workload and allow them to lead a normal work-life balance throughout the busy tax season.
Alex Dundas (CPA)
I believe it’s all about execution. As a CPA working at Stamped, my colleagues and I are the beta testers of the new software the engineering team is developing. One of our roles is to help the software engineers understand the accounting and auditing standards. As auditors, we consider the reasonability of accounting data. As the application of AI in the audit space evolves, we are anticipating changes to what is considered reasonable. Case law, history, norms, and professional judgment go into the calculus of what is reasonable. When we bring AI into the process, that shifts the foundations of the industry. We are thinking about what reasonability is going to look like in 5 years and developing new audit methodologies driven by AI. In this sense, our work is a bit academic, as we work with our engineering colleagues to unlock the potential of AI.
So how worried should humans be about the capacities of AI? Will accountants be replaced?
Jonathan (software engineer)
At some point, everyone should be worried. I don't know if you guys heard about this, but GitHub, a big software engineering firm, released software that can provide coding suggestions for you. This essentially means that a computer could self-program an application in the future. This is pretty insane because the precedent was already set for this when small lines of code could be autocompleted one variable or function name at a time through suggestions given to you. Now it’s writing code in your place entirely from start to finish. This is amazing because these suggestions and auto coding functionalities are based on billions of lines of codes that the AI analyzed from all the open-source code available on the internet. If AI can write code, then there's an AI that could read invoices and complete the reconciliation process by itself. Although AI will have the ability to do everything one day, I’m not aligned with the belief that it will completely replace accountants within the next decade.
Alex Dundas (CPA)
My answer to this question is going to be evolving, but my thoughts now are similar to the ones I had about a year ago. Most of the work that I do in an assurance engagement is not at the transactional level. It is completing checklists, it's referencing the standards, it’s understanding what's going on in the intangibles, and a lot of it has to do with the application of professional judgment. Most of my job is identifying relevant questions and documenting analysis. The questions we ask require an understanding of who we are asking, and we pose questions in specific ways to obtain the right information. The job of the auditor is to understand when they have appropriate and sufficient audit evidence to gain comfort over the financial statements. I expect accountants and auditors will have a longer lifespan, whereas jobs in transaction processing may have a shorter lifespan. The caveat is that the adoption rate in our industry is slow. I thought the adoption rate for cloud accounting would be much higher over the last five years, but accounting is a slow-moving industry. The change is going to be incremental.
So even if this technology is available, you’re saying it won’t immediately replace accountants?
Jonathan (Software engineer)
You can't forget the factor of trust in the adoption rate either. If people aren't ready to trust a computer to complete their taxes, then it simply won’t happen. It's the same thing with the adoption of self-driving cars. Google has been working on a self-driving car for a while, and they recently started driving around San Francisco. Although the rate of incidents in the self-driving car is lower than a human-driven car, nobody is ready to completely trust a self-driving car yet. Maybe the tech geeks in Silicon Valley, but no way would my grandmother or any regular citizen trust that yet. All this to say that AI will only replace certain aspects of our daily lives, such as accountants, when people are ready to accept it.
The rate of adoption for many disrupting technologies is a long one. Accountants, for the moment, do not have to worry too much. As AI evolves, our trust in the new technology will too. For now, human relationships will continue to drive business, and tech continues to increase the value offering of our relationships.