A Big Four consulting giant tries to make accounting less boring with AI

Raj Sharma, EY global managing partner of growth and innovation.EYEY is investing $1 billion in AI to attract more talent into the accounting profession.There's a shortage of accountants due to complex regulations and an aging workforce.EY's AI tools aim to make accounting more engaging and improve accuracy and job satisfaction.Accounting has a reputation for being technical, tedious, and high-pressure. A Big Four firm is trying to change that with AI.EY, one of the world's largest accounting and consulting players, wants to use this technology not to replace accountants but to make their work more interesting and fulfilling.EY is investing $1 billion to increase early-career compensation and work with colleges to encourage students to pursue CPA careers. Some of this money will go toward smarter tools that the firm hopes will also attract more young workers into the profession while retaining existing talent."Under no circumstances are we ever thinking that we will get rid of our human workforce and do this just through AI agents or other things like that," Raj Sharma, a global managing partner at EY, told me in a recent interview.This problem is more about a lack of human employees. In a world where modern businesses operate across dozens of jurisdictions with complex and ever-changing regulations, audits have become a logistical and mental minefield. That complexity has driven some away from the field, contributing to a nationwide accountant shortage.About 65,000 students in the US completed bachelor's or master's degrees in accounting in the 2021-22 school year, 18% fewer than a decade earlier. About 30,000 people took the CPA exam in 2022, down roughly 40% from 2010. Meanwhile, three-quarters of CPAs in the US were thought to be at or near retirement in 2019, according to the American Institute of Certified Public Accountants."Even though AI can do a lot of things, think of our business around assurance, audit, and the certifications that are required. We are significantly short of people coming up with accounting degrees," Sharma said. "We are still hiring big classes of accountants from colleges, and we are training them into AI."EY is embedding this AI assistance across tax, risk, and finance workflows via its EY.ai Agentic Platform, developed and launched with Nvidia earlier this year. This has already created about 200 specialized AI agents that support 80,000 EY employees to help with tasks such as data collection, document analysis, and tax compliance — automating dull tasks and amplifying more engaging ones.More interesting, less daunting, auditsSharma cited AI-powered audits as an example of what's possible.Audits are a staple of accounting work that traditionally involved sampling a small subset of transactions to look for errors or fraud. This is painstaking work, and pretty daunting when you're checking the books of huge, complex multinational corporations."It's just overwhelming for our accountants," he told me. "That's one big reason why people don't want to go into accounting because it's so technical, so deep. And the risks are so high of getting it wrong."He explained how AI can make these situations more manageable. For example, an audit that used to take five hours for a particular process might now take two and a half hours with EY employees supported by AI agents."In the past, we would maybe sample 100 transactions. Now, with AI, you could sample 10,000 transactions," Sharma said.EY's accountants would get more involved in situations where this new technology flagged maybe 25 potentially questionable transactions out of that 10,000 total. They'd dig deeper into those specific situations, which could be more interesting and useful work."The accuracy of the audit becomes a lot better. Our ability to catch fraud is a lot better in that particular area," Sharma said. "So AI is a welcome relief for these people that are out there, that they have another tool to be able to help and do more.""Our people are a lot happier in that particular area," he added. "We are making AI agents available for our people to work with, but not with the intent that we will replace the accountants that are out there."Make accounting human againEY is training its employees to work hand-in-hand with these AI tools. It sees a future where the job is less about memorizing arcane rules and more about having human accountants apply their insights in the right places, such as "high-end work around due diligence" in EY's tax practice, Sharma said.EY generated just over $50 billion in revenue last year and has roughly 400,000 employees. Sharma said the firm hopes to become a $100 billion company with 500,000 people and 200,000 AI agents. However, he added that EY is not impervious to what may happen in the world and the broader economy.Accounting may never be the most glamorous profession, though EY is trying to make it less grueling. With AI taking on some of the complexity and monotony, the firm is opening the door to a new kind of accounting career, where professionals do more thinking, less grinding, and might find greater purpose in their work.That, in the long run, might be exactly what saves the profession.Read the original article on Business Insider