What is AI Bookkeeping? 2024 Guide
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From chatbots to product recommendation engines, AI is already widely used. Now, major accounting firms are investing billions in AI and data analytics, recognizing its transformative potential in business accounting.
So, what does the rise of AI mean for your business’s finances?
AI in bookkeeping for all business sizes
AI accounting automation isn’t just for large corporations. Modern finance firms offer AI-powered bookkeeping and accounting services that benefit businesses of all sizes. Here’s what you can expect from integrating AI into your bookkeeping—now and in the future.
Using AI in bookkeeping and accounting
Artificial intelligence enables machines to complete tasks and make decisions in ways that mimic human actions. Virtual bookkeeping services and accounting software use AI to automate repetitive tasks and workflows, including:
- Recording data in the correct accounting formats
- Sorting transactions into categories
- Reconciling accounts with bank order statements
- Recognising written data from scanned receipts or invoices to identify vendors and amounts
- Matching receipts or invoices to relevant transactions
- Comparing employee expense reports against company expense policies to ensure compliance
- Tracking changes in prices among subscriptions, suppliers, and contractors
AI often works alongside machine learning (ML). ML identifies patterns in data that help computers make more accurate decisions in similar scenarios using algorithms, statistical models, and feedback loops. ML also helps bookkeeping and accounting systems identify if incomes or expenses deviate from previous months and why these variations occur. The more transactions ML reviews and learns from, the better AI can make accurate decisions and complete accounting tasks for future transactions.
Businesses that use AI bookkeeping tasks gain four key benefits of AI in accounting:
Improved record accuracy
Manual data entry, core to traditional bookkeeping and accounting, is prone to human error. AI, however, performs data entry with high accuracy, ensuring records are always up-to-date / audit-ready in accordance with internal, local, state, and federal regulations.
Increased focus on expertise
With AI handling time-consuming tasks like categorising transactions and processing reconciliations, accounting professionals and finance teams can focus on complex, strategic tasks like financial analysis and modelling.
Advanced financial insights
AI automation delivers instant financial insights, eliminating the wait for month-end reporting. Used alongside ML and natural language processing (NLP), AI first understands the data before analysing and presenting its implications.
Cost savings
Leveraging AI to streamline financial processes like data entry, transaction categorisation, reconciliation, and insights can save businesses significant money over time. The adoption of AI / robotic process automation (RPA) can reduce financial services costs by up to 80%.
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The future of AI in bookkeeping
AI in finance software is still in its early stages, but the market is growing quickly, poised to produce multiple $10 billion bookkeeping automation businesses in the coming years. Increasing demand for AI / ML is driving developments that will further enhance the complexity of transactions and the proportion of accounting work these technologies can manage.
In conclusion, AI is transforming bookkeeping and accounting, offering improved accuracy, efficiency, and cost savings. While AI handles routine tasks, human expertise remains essential for strategic financial management. As AI technology continues to evolve, the synergy between AI and human intelligence will redefine the future of business finance.
Why Inkle Books is ideal for AI bookkeeping?
Streamlined integration
Inkle Books seamlessly integrates with existing financial systems and data sources, allowing for easy access and reconciliation of transactions from multiple accounts.
Automated accounting
The software platform automates various accounting tasks, such as transaction categorisation, updating charts of accounts, and maintaining a general ledger, saving time and reducing errors.
Vendor management and compliance
Inkle Books excels at tracking vendor payments and managing compliance. It automates the collection of W-forms and links 1099 filings to vendors, ensuring regulatory adherence.
Real-time insights
Inkle Books provides real-time financial updates and reporting, offering instant access to metrics like burn rate and runway and enabling quick, informed decision-making.
Efficient monthly closings
The software supports efficient monthly bookkeeping with regular updates and historical record reviews, ensuring current and comprehensive financial data.
Custom invoicing
Inkle Books features a custom invoicing tool that allows businesses to create branded invoices that easily reflect the company’s identity.
Cost savings
By automating routine financial tasks, Inkle Books helps businesses save money, reducing operational costs and minimizing the need for manual labor.
Future-proof with AI
Inkle Books evolves with advancements in AI and machine learning, continually improving its accuracy and efficiency and handling increasingly complex accounting tasks.
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Why does Inkle Books excel in AI bookkeeping?
Competitor comparison
Inkle Books offers a more holistic financial management solution compared to competitors like Vic.ai, Zeni, and Docyt. While Vic.ai focuses on accounts payable automation and Zeni provides real-time financial insights, Inkle Books integrates comprehensive features that automate daily accounting tasks, track expenses, and manage compliance efficiently. This makes Inkle Books a more versatile choice for businesses looking for an all-in-one solution.
Scalability
Inkle Books is designed to grow with your business. It supports multi-entity consolidation, making it suitable for startups and expanding businesses with multiple subsidiaries. The platform can handle increasing transaction volumes and complexities, ensuring continuous efficiency and effectiveness as your business scales.
Affordable pricing
Starting at $29 per month, Inkle Books offers a competitive pricing model that is accessible for small to medium-sized businesses. With different pricing tiers available, businesses can select the plan that best suits their needs, ensuring cost-effective solutions without compromising on essential features (GetApp).
Robust security
Security is paramount for Inkle Books. The platform employs advanced encryption technologies and secure data storage solutions to protect sensitive financial information. Regular updates to security protocols ensure compliance with industry standards and safeguard against potential threats, providing users with peace of mind.
Wrapping up
Inkle Books is a robust AI bookkeeping software that streamlines accounting processes, enhances efficiency, and provides real-time insights, making it an excellent choice for startups seeking to improve financial management through automation.
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