Artificial Intelligence in Accounting Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)
The Artificial Intelligence in Accounting Market is segmented by Deployment (On-Premise, Cloud), Component (Solution, Service), Technology (Natural Language Processing (NLP), Machine Learning & Deep Learning), Organization Size (SMEs, Larg Enterprises), Application (Fraud & Risk Management, Invoice Classification & Approvals, Reporting, Automated Bookkeeping, and Others), and Geography.
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AI in Accounting Market Snapshot
Scope of the Report
Key Market Trends
TABLE OF CONTENTS
AI in Accounting Market Snapshot
2018 - 2026
Fastest Growing Market:
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The market for Artificial Intelligence in Accounting Market is expected to register a CAGR of 30% over the forecast period (2021 - 2026)
Over the years, there has been significant improvement been made in Artificial Intelligence with respect to the accounting profession that has changed its focus from paper and pencil entry to software-based entry. AI is applicable to all major aspects of accounting operations added with its ability to reduce the tedious, rigorous nature of the accounting profession is changing how financial institutions operate while delivering efficiencies.
As with the AI ability to analyze large quantities of data, detect anomalies in the system, optimize workflows while ensuring speed and scalability is driving financial professionals to adopt AI to assist with business decision making based on insights-driven from accounting data such as transactional data, customer demographics in real-time.
By Integrating AI, the companies are able to perform cash flow forecasting, predict bankruptcy, detect frauds thereby allowing the accountants to help client respond against financial challenges before they become acute and adjust the expenditure accordingly, furthermore it helps accountants to broaden their predictive consultancy beyond traditional financial planning and further incorporate other critical areas of business.
For instance, research conducted by MIT Boston found that 85% of people around the world believe that Artificial Intelligence will enhance their competitive advantage. also according to a survey published by FreeAgent in April 2020, highlights that 81% of accountants believe that levering AI would save up as much as 10 working hours a week by helping them automate the redundant tasks and would potentially unlock up to 68,163 pounds of additional revenue annually.
The study also stated that accountants around the world consider AI for dealing with accounting tasks such as accurate auto-reconciling of data in clients account (50%), dealing with HMRC ( 44%), preventing clients entering incorrect information (45%), added it 90% of larger firms employing over 300 people showed interest in using AI as compared to 76% in SMEs.
Furthermore, AI-enabled system also supports accountant in auditing and compliance as it constantly monitors documents against laws, rules, and flag the audits with issues. with frauds cost costing companies billions of dollars each year, machine learning algorithms quickly sift through an enormous amount of data to detect potential frauds which may otherwise be foreseen by humans, For instance, the IL&FS fraud case that cost INR 91,000 crore were the result of serious audit irregularities in IL&FS accounts.
Owing to these instances companies are embracing and implementing AI into their streamline business operations with accounting on top of their list as it delivers increased productivity, accuracy, and reduced cost, thereby driving the growth of the market.
However, majority of business still have not employed into their workforce majorly due to uncertainities around the business case, lack of Skill and ROI.
Scope of the Report
Technological advances such as Artificial Intelligence are poised to transform the finance and accounting industries owing to its ability to eliminate tedious task that helps financial staff to prioritize higher impact responsibilities. The reports cover the emerging trends in Artificial Intelligence in Accounts Market segmented by deployment, component, technology, organization size, applications across different regions studied.
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Key Market Trends
Natural Language Processing to drive the Growth of the Market
Natural Language processing is considered as part of the AI domain that is focused on communication between humans and computers evidently they address the inherent problems that humans communications turn ambiguous and imprecise. Its applications are often deployed to mine end-user industry documents to obtain insights.
As the accounting domain frequently deal with textual documents including management assessment, financial performance, domain standards, regulations, compliance, and evidence about the same among others, with NLP companies would be able to obtain insights, inference, methodologies to advance its knowledge and prevent potential risks
Also, it helps enterprises to automate accounting such as tasks such as data entry, processing financial reports, invoices, and receipts among others, and eliminate the time sinks thereby saving business costs.
For instance, Botkeeper, a bookkeeping program developed by Botkeeper Inc helps organizations across the world to automate accounting tasks, the company states that Botkeeper has automated more than 1.2 million of working hours for its 1,000 clients further on which study states that employee that 240 hours due to automation would return USD 9240 in value to the company such monetary and timely benefits is driving the growth of the market.
Moreover, Most of the Big 4 accounting firms along with legal firms have already deployed AI-driven NLP with robotic process automation to automate auditing tasks which otherwise turn cost the firms several weeks of work.
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North America holds major market Share
North America is one of the major markets for AI in the accounting market, owing to its dominance in AI and machine learning technologies. Most of the major market vendors in the studied market are US-based, which also gives the region an innovative advantage.
Additionally, the regional governments are increasingly motivating the adoption of AI, ML, and NLP technologies, which is also developing space for the studied market vendors to expand their presence in the region
The Vendors in the region are strategically collaborating with each other either by partnership or acquisitions to leverage their expertise and capture the market share, For instance, In February 2020, Intuit Inc, the developer of AI-driven platforms QuickBook, Mint, Turbox based in United announced the acquisition of Credit Karma, a consumer technology platform developer with over 100 million members in Canada, US, and the UK. This acquisition has brought two technology players together to focus on a shared goal that is to capitalize on the accounting sector of the region by helping the company to solve their financial problems.
According to the Bureau of Lab Statistics, United States Department of Labor listed the Accountant and auditor occupation under the list most new jobs to anticipate growth rate of 10% from 2016 to 2026, at this growth rate added with preference accountants towards AI leverages the growth of the market.
Furthermore, With the increasing number of accounting frauds added with online transactions and multi-device accessibility offered by vendors in the region is driving the growth of the market.
However, with the recent outbreak of global pandemic COVID-19 and the announcement of lockdowns across the world with the US economy reporting 701,000 loss in job in month of March 2020 and few accounting firms facing recession may hinder the growth of market.
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The Artificial Intelligence in Accounting market is highly competitive and consists of several major players who are trying to gain larger shares. These major players with prominent shares in the market are focusing on expanding their customer base across foreign countries and are also providing new innovative solutions, along with deals and mergers to increase their market shares and profitability. Key players include Google Inc., Microsoft Corporation, Xero, Intuit, etc. Recent developments in the market include
March 2020 - Xero announced the launch Xero Tax in the UK and also the integration of Hubdoc into its Xero platform, the Hubdoc which was previously offered as standalone add on will be available as a streamlined set up within Xero. The company aims to provide real-time insights, data integrity, and end-to-end compliances to the accountants through Hubdoc and Xero Tax platforms.
February 2020 - Intuit Inc' Intuit Proconnect announced the collaboration with Karbon to deliver Inuit Practice Management that is aimed to accelerate the software capabilities for the tax professionals. This solution delivers a collaborative place for accounting firms and professional services to help manage their workflow and communications.