The short answer is no, AI won’t replace bookkeepers, but their job will change

AI can already handle quite a few of the traditional bookkeepers’ tasks thanks to cloud-based software such as Xero and QuickBooks. These tasks include reconciling bank payments, categorising transactions, invoicing, payroll, and VAT returns, in short, the repetitive, rules-based work that once filled a bookkeeper’s week. But “automating the task” to improve productivity is not the same as “replacing the bookkeeper” and human oversight remains essential. Here are some examples of what a human bookkeeper will still need to do and why.

Reviewing AI judgment calls. AI is imperfect and can make mistakes. Take coding transactions. If AI misclassifies an expense, it will use the incorrect misclassification each time that particular expense is coded. This error can quickly compound across months of accounts so a bookkeeper who knows the business is needed to catch these issues.

Potential damage to client relationships. AI has no way of knowing that a client’s one-off, unusually large purchase won’t be a regular sale, or that a supplier payment is late because the invoice is disputed. AI only uses the data and doesn’t necessarily know the context, so can potentially create issues with a client or make assumptions when projecting future sales. A human bookkeeper will pick up irregularities, add in the context and not make assumptions.

Interpreting regulatory changes. When new regulations are introduced, such as MTD (Making Tax Digital), HMRC or VAT rule changes, a human needs to interpret the changes and determine how they could impact that business. Often, it’s more complicated than a simple processing change and once again, context matters enormously.

As well as critical thinking, a human bookkeeper is also needed to:

● Interpret the numbers and give relevant advice. Having the numbers you need is one thing but interpreting them and telling clients what the numbers mean is another. A human will be needed for forecasting, spotting trends and flagging risks – all tasks that AI can support; however, the interpretations must be made in context of each business and market sector.
● Provide trust. Clients need a human being to be responsible for their books. There are liabilities to consider when there are errors in business accounts, and AI will not pay any resulting fines!
● Deliver emotional support. When a client is worried about cash flow or facing an HMRC enquiry, they want to talk to a person for emotional support – whilst AI can tell you the facts, it’s not so good at being a shoulder to cry on.

AI, technology, automation – it’s all useful and saves time, which has led to many professionals being concerned that their job will disappear. It’s not unlike what happened in the 1980s when Microsoft launched spreadsheets and we no longer used paper-based accounts, aka ‘the books’. At that time, many predicted the end of bookkeepers, except the profession grew as we used the technology and could spend time on interpretive and higher-value work. Undeniably, the pace of change is much faster, and AI is efficient so it can take on many repetitive tasks, but it also opens up many new opportunities for bookkeepers and accountants.

When we asked AI its opinion, this is what it told us. ‘The bookkeepers most at risk are those who resist adapting. The bookkeepers who embrace AI as a productivity tool whilst they develop advisory and interpretive skills are likely to be more valuable, not less.’ We tend to agree.

The Hour Hands (very human) bookkeepers are on hand to help

We’ve been embracing technology for many years now and are proud Xero Partners, proving our knowledge, but what sets us apart is our ability to interpret the numbers and spot any inaccuracies or unexpected results. It’s because when we work with you, we spend time getting to know you and your business, so we know what’s ‘normal’, and what’s not. This creates a partnership between our bookkeepers and your business – a very special relationship that adds value as well as ensuring you remain compliant and on top of your accounts.

If you’re ready to explore how hiring a very experienced and efficient Hour Hands bookkeeper will help your business, just give us a call. We’re always happy to discuss options and packages to ensure you get all the support you need – and deserve.

Give us a call today on 01727 818262 or email us on hello@hourhands.co.uk. We look forward to hearing from you.