How artificial intelligence is impacting finance

The ramifications of artificial intelligence (AI) are widespread across the local and global economy. The financial sector is no exception. The prevalence of AI in finance is among the highest when compared to other industries.  

More than nine in ten finance teams say they are planning to onboard AI within the next year, according to a report from accounting software providers AccountsIQ. The report, Confessions of the Finance Function, also found that 82% of younger finance professionals believe AI tools like ChatGPT will impact their work within five years, while almost a quarter of senior professionals perceive AI technology as a potential job threat. 

Charity professionals and financial decision-makers need to dig deeper and understand more about the ramifications of AI on the sector. In general, AI quickens decision-making and automates processes at a rapid speed, which is an advantage for both financial and charity professionals with limited time and resources. But there are also associated risks.  

In this article, we explore more about how AI is impacting financial processes in the charity sector and discuss how it may ease our workloads in the future.

What’s AI got to do with it? 

AI tackles two challenges. It computes huge amounts of data and automates tasks. Automation may prove particularly helpful when you consider that AccountsIQ research found more than a third of finance professionals have taken time off due to stress. When asked what could improve the culture or atmosphere of their workplaces, 30% called for better software and increased automation to help alleviate the stress of burdensome tasks.  

In the charity sector, too, where resources are already stretched thin and the cost-of-living is hitting hard, AI’s ability to free up time usually taken on time-consuming finance tasks is vital.   

But time is not the only issue solved by AI. Manual data entry is not only time-consuming, but also prone to human error. Almost all (96%) of the financial professionals questioned in the AccountsIQ report said their organisation experiences accounting errors, with both senior and young professionals identifying the lack of automation as the leading cause behind them.  

By using AI, charities can reduce the likelihood of these errors, improve decision-making, and make it easier to spot patterns in financial data. Around half of financial professionals recognise the value of AI tools for financial analysis and strategic planning, in particular, according to AccountsIQ’s report.  

This, in turn, reduces the stress placed upon financial professionals in the sector. Staff turnover in the charity sector is high, with many organisations highlighting employee retention as a key challenge for the year ahead. Adopting AI to support their work, “organisations can create a workplace that not only harnesses the potential of technology but also supports the professional growth and wellbeing of their teams”.  

Darren Cran, Chief Operating Officer at AccountsIQ, adds: “It’s hugely encouraging that more than nine-in-ten organisations have plans to implement new technology. How they approach that and the technology they employ will be critical as AI and AI-related solutions expand their capabilities.  

“Organisations that achieve the right balance between human skill and technology will be far better placed to optimise efficiency and retain talented individuals. AI is not a panacea, and business leaders should think hard about how to elevate staff productivity and remove low-value work.” 

Charities can find out more about how to improve their financial services by watching the webinar on-demand, Streamlining your non-profits finance process: a step-by-step guide.  

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