Accounting
Agentic AI: small steps, big aspirations at accounting firms
Despite its relative novelty, major accounting firms have wasted no time in capitalizing on the rise of agentic AI, with technology leaders having already developed and deployed initial solutions for both client work and internal efficiencies.
While the precise definition can vary depending on who is asked, very broadly agentic AI could be described as software that is capable of at least some degree of autonomy to make decisions and interact with tools outside itself in order to achieve some sort of goal—whether booking a flight, sending a bill or buying a gift—without constant human guidance. Agents are not necessarily new, but the rise of generative AI has made them much easier to make and use, as doing so no longer requires specialized coding skills.
Daren Campbell, tax technology transformation leader with Big Four firm EY, said his firm has what is referred to internally as “an agentic AI factory” which is used to facilitate onboarding and upskill staff. The firm starts with identifying processes well-suited for agentic AI integration, then works with those responsible for the process by training them up on the agent factory to build out what they need. This has led to what he called a host of “mini agents” or “a bunch of minions” automating not entire processes end-to-end (yet) but various pieces here and there within the workflow.
“So, it’s not push button returns or anything close to that, but we… are deploying the smaller parts of the process with the intention of getting to the point where we can connect all the mini-agents to have something tackling a larger part of the process,” he said.
As just one example, EY is building out their current anomaly detection solutions, which already use AI to identify and visualize errors. Using agents, he said, will allow them to not just identify errors but propose corrections to those errors for review by a human. Something like this, said Martin Fiore, deputy vice chair of tax for EY Americas, would have been very difficult to do without the aid of AI agents.
“How do you take high volumes of data that would be impossible or not worth an individual spending time on [processing] but one you use AI and in minutes or hours do what used to take years and improve this process? The bots were more reactive, but now we’ve got something proactive. … VAT is a great example, where we have a multinational organization that operates in 120 countries. How do you take that and pull it together in a way that the human can judge against? It is a step you take to get to the next level, if we don’t we can’t get the quality that we need,” he said.
Campbell also pointed to a pilot program with several of their clients where autonomous agents tied to the company’s data actively look for regulatory changes that would affect the jurisdiction they operate from; the agent would flag the change, then notify the tax practitioners and suggest key people (e.g. external advisors, regulatory agencies) they might want to meet with to discuss the matter further. But he stressed that this is a very early development, there isn’t anything like this already in production.
Kelly Fisher, practice partner and technology specialist with top 25 firm Wipfli, said her own firm is currently experimenting on themselves with agentic AI before introducing any new solutions to clients. The most recent thing they did was create a chained series of agents that monitors and reports on legislative and regulatory changes; there is a researcher agent, a curator agent and others that, working together, researches and reports on legislative and regulatory changes for the industries they serve.
“It is for broad brand building insights, one of our goals as an organization was to [keep up with] with the pace at which we are seeing legislative changes or chatter coming out to make sure we deploy information and thought leadership to our clients, applicable specifically to our middle market clients and their insights, faster,” she said.
Asked when they deployed this solution, Fisher said about three weeks ago, speaking to the speed at which even non-coders can build and deploy AI agents.
The firm turned to agents when generative AI alone was not giving them the results they wanted. They added more documents for reference as well as refined their prompts, which did improve the bot though it still felt short of the quality they needed. So the firm then turned to multi-chained agents with specific use cases that work in concert.
“That is a pretty easy win, I would say, with semi-autonomous agents,” she said, adding that they intend to keep refining and improving the application over time.
OJ Laos, director of the AI Lab for Top 25 firm Armanino, said his own firm went through a similar journey. If one defines agentic AI as simply autonomous software, then Armanino has already been experimenting with the technology via research platforms like Microsoft’s AutoGen as well as thirty party solutions like Swarm AI and Crew AI. At its core, he said, these were “bots talking to bots, you could actually see their conversations.” They began doing this about a year ago, using them to do things like query the latest developments in the private equity world.
Fast forward to a year later, and AI models have improved both in terms of their performance as well as the ease of creating them. The old way, he said, was a lot slower and more complicated, and even then the bots would still occasionally “drop the ball between each other.” Recent improvements have led to new possibilities for process automation that would have been impractical just a short time ago.
One of the examples Laos is personally very excited about is enhancements to the firm’s audit platform to automate the document collection process. One of the most common things in audits, he said, is the big list of requests, which has usually called for manual processes to complete. The auditor would send the request list to the client, the client would have to hunt down 50 or more documents and send them to the auditor, who would then need to look at it and figure out where it fits into the larger audit process or, if it doesn’t, send it back to the client.
“This tool lets you just drop everything. If I’m the client, I’d say here’s 50 documents, go knock yourself out. The [agent] looks at them, studies what they are, figures out that this goes to that task, this goes to that auditor, this is for this use case and so on. The auditor still has to look at the evidence to see that it matches and makes sense, but it can dramatically speed that [process] up,” he said.
The next logical step past that, he said, is to have the agent assist with substantive testing, and while this remains only theoretical for now, Laos said this is what they’re eventually building towards.
Armanino has also been experimenting with OpenAI’s new Operator model, which is essentially a browser with agentic AI functions that appear to use the keyboard and mouse to do some task. Specifically, they have been seeing how well it works through RPA with the thought that, in time, it could reduce the need for custom integrations.
Even when a firm doesn’t currently have agentic AI solutions deployed, many intend to do so in the future. Avani Desai, leader of top 50 firm Schellman, said that her own firm has active R&D projects for specific agentic AI use cases both for internal efficiencies and client work.
One solution in development speaks to their cybersecurity specialization. Schellman needs to understand a client’s IT infrastructure before it can offer a proper cybersecurity solution. Right now, they wait for the client to give them this information, which they then review once they’re on site, a lengthy process that she said isn’t even technically a part of the audit itself.
“So one thing we want to focus on from an agentic AI perspective is really on the discovery section, a lot of this can really help our newer associates, even [with] a newer client, get all that information to allow us to just be smarter when we are on site,” she said, adding that they currently don’t plan to focus on testing evidence with AI, as some of their clients aren’t comfortable with that.
Schellman is also developing agentic AI for training purposes, creating a program that can act as a sort of digital worker with knowledge of SOC certification requirements and ISO standards and FedRamp compliance and payment card industry standards to help bring new staff up to speed.
“We [would] have agentic AI help by saying ‘these were past decisions’ so we can improve strategies over time… What we’re really looking at is how we can look at things from a training and awareness perspective,” she said.
Desai added that while they are intrigued by the idea of using agentic AI in compliance audits with no human intervention, “we have decided not to go down that path just yet.”
Schellman is not of the move fast and break things mindset, which explains why they are being very deliberate with their agentic AI ambitions. The ability for agentic AI to make independent decisions and adapt itself in real time, said Desai, creates an entirely new category of risk that must be considered. Humans must be concerned not only about the independent decisions of an AI agent, they must also think about how it dynamically adapts to circumstances and work to make sure it does so in a way that aligns with ethics and guardrails.
“This is why a human in the loop is so important because, at the end of the day, we want agentic AI to run autonomously, that is where you get the value from it, but you need to be really cognizant when you’re designing and developing agents that a human must be a part of that. … I also think there are so many AI policies around AI safety and ethics and governance: that also needs to be part of the development process. At the end of the day we won’t have [as much] human oversight once these autonomous agents start working, but I think you can identify risk and mitigate that risk early in the development lifecycle,” she said.
Cruise operators may yet avoid paying more U.S. corporate taxes despite threats from U.S. Commerce Secretary Howard Lutnick to close favorable loopholes.
Lutnick’s comments on Fox News Wednesday that U.S.-based cruise companies should be paying taxes even on ships registered abroad sent shares lower, though analysts indicated the worry may be overblown.
“We would note this is probably the 10th time in the last 15 years we have seen a politician (or other DC bureaucrat) talk about changing the tax structure of the cruise industry,” Stifel Managing Director Steven Wieczynski wrote in a note to clients. “Each time it was presented, it didn’t get very far.”
Industry shares fell sharply Thursday. Royal Caribbean Cruises Ltd. closed 7.6% lower, the largest drop since September 2022. Peers Carnival Corp. and Norwegian Cruise Line Holdings dropped by at least 4.9%.
All three continued slumping Friday, trading lower by around 1% each.
Cruise companies often operate their ships in international waters and can register those vessels in tax haven countries to avoid some U.S. corporate levies. It’s exactly those sorts of practices with which Lutnick has taken issue.
“You ever see a cruise ship with an American flag on the back?,” Lutnick said during the interview which aired Wednesday evening. “They have flags like Liberia or Panama. None of them pay taxes.”
“This is going to end under Donald Trump and those taxes are going to be paid.” He also called out foreign alcohol producers and the wider cargo shipping industry.
The vessels are embedded in international laws and treaties governing the wider maritime trades, including cargo shipping. Targeting cruise ships would require significant changes to those rule books to collect dues from the pleasure crafts, analysts noted. The cruise industry represents
They also pay significant port fees and could relocate abroad to avoid new additional taxes, according to Wieczynski, who sees the selloff as a buying opportunity.
“Cruise lines pay substantial taxes and fees in the U.S. — to the tune of nearly $2.5 billion, which represents 65% of the total taxes cruise lines pay worldwide, even though only a very small percentage of operations occur in U.S. waters,” CLIA said in an emailed statement.
Should increased taxes come to pass, the maximum impact to profits would be 21% on US earnings, Bernstein senior analyst Richard Clarke wrote in a note. That hit wouldn’t be enough to change their product offerings, though it may discourage future investment. Recently, U.S. cruise companies have
Cruise lines already employ tax mitigation teams that would work to counteract attempts by the U.S. to collect taxes on revenue generated in international waters, wrote Sharon Zackfia, a partner with William Blair.
Royal Caribbean did not respond to requests to comment. Carnival and Norwegian directed Bloomberg News to CLIA’s statement.
Artificial intelligence took the business world by storm in 2024. Content creation companies received powerful new AI-powered tools, allowing them to crank out high-quality images with simple prompts. AI also helped cybersecurity companies filter email for phishing attempts. Any company engaging in online meetings received an ever-ready assistant eager to show up, take notes and highlight the most important talking points.
These and countless other AI-driven tools that emerged during the past year are boosting efficiency in virtually every industry by automating the tasks that most often bog down business processes. Essentially, AI takes on the business world’s day-to-day dirty work, delivering with more accuracy and speed than human workers are capable of providing.
For accounting, AI couldn’t have come at a better time.
As companies struggle to do more with less, AI offers solutions that promise to reshape the accounting world. However, putting AI to work also forces companies to accept some new risks.
“Bias” has become a huge buzzword in the AI arena, forcing companies to consider how the automation tools they bring in to help with processing data may introduce some questionable or even dangerous ideas. There are also ethical issues associated with next-level AI-powered data processing that have some concerned that achieving AI-assisted business efficiency also means risking
To make AI worthwhile as an accounting tool, companies must find ways to balance gains in efficiency with the ethical risks it presents. The following explores the growing role AI can play in business accounting while also pointing out some of the downsides that should be carefully considered.
AI upside: Increased accuracy and efficiency
Accounting isn’t accounting if it isn’t accurate. Miskeyed amounts or misplaced decimal points aren’t acceptable, regardless of the company’s size or the business it is doing. When the numbers are wrong, the decision-making that relies on those numbers suffers.
Consequently, manual accounting typically moves slowly to avoid errors. Business leaders have learned to wait on financial reporting prepared by hand. They’ve also learned that because of processing delays, they may not have the numbers they need to take advantage of unexpected opportunities.
AI changes the equation by improving the speed and accuracy of reporting. AI-powered data entry automatically extracts numbers from invoices and other financial statements, eliminating the need for manual entry and the mistakes that can occur when an accountant is distracted, tired or just having an off day. AI can also detect errors or inconsistencies in incoming documents by comparing invoices and other documents to previous records, providing a second set of eyes for accounts as they ensure companies aren’t being overbilled or under-compensated.
When it comes to increasing the pace of accounting, AI’s capabilities are truly astonishing. As
AI accounting gives business leaders accurate financial data in real time, meaning they have relevant and reliable accounting intel when they need it rather than requiring them to wait until the end of the month to have a report on where their cash flow stands. It also has the potential to give a glimpse into the future by drawing upon historical data to drive predictive analytics. AI can look at what has been unfolding in a business and its industry to plot the path forward that makes the most financial sense. It’s not exactly a crystal ball, but it’s as close as most businesses should expect to get.
AI upside: More time for high-level engagement
As AI began to make inroads in the business world,
The manual work typical of conventional accounting is tedious, tiresome and time-consuming. Doing it well eats up much of the energy accountants could otherwise apply to higher-level activities. By using AI automation for those tasks, accountants gain the resources needed for high-level engagement.
Accountants who partner with AI gain the capacity to shift their role from bookkeeper to financial advisor. Rather than focusing all of their energy on preparing reports, they are freed up to interpret the reports. Delegating data entry and other day-to-day tasks to AI allows accountants to become strategic partners with the businesses they serve, whether as in-house employees or external advisors.
Financial forecasting becomes much more doable when AI is in play. Accountants can develop comprehensive financial models that forecast future revenue and expenses. They can also assess investment opportunities, such as determining the viability of mergers and acquisitions, and help with risk management and mitigation.
Tax planning and optimization will also become more manageable once AI automations have been added to the mix. Automating data extraction and categorization streamlines the process of classifying expenses for tax purposes and identifying expenses that are eligible for deductions. AI automation can also be used for tax form completion, adding speed and a higher level of accuracy to a process that very few accountants look forward to completing manually.
AI downside: Higher data security risks
Accountants are well aware of the dangers of data breaches. Allowing financial data to fall into unauthorized hands can lead to financial loss, operational disruption, reputational damage and regulatory consequences. Shifting to AI accounting can potentially increase the risk of data breaches.
Changing to AI accounting often means concentrating financial and other sensitive data and moving it to interconnected networks. Concentrating data creates a target that is more desirable to bad actors. Shifting it to the cloud or other interconnected networks creates a larger attack surface. Both factors create situations in which higher levels of data security are definitely needed.
Addressing the heightened threat of cyberattacks requires a combination of tech tools and human sensibilities. To keep accounting data safe, encryption, multifactor authentication, and regular testing and update protocols should be used. Training should also help accounting teams understand what an attack looks like and how to respond if they sense one is being carried out.
AI downside: Less process customization
Developing the types of platforms that can safely and reliably drive AI automations is not an easy — nor cheap — undertaking. Consequently, many companies choose the economy of “off-the-shelf” platforms. However, opting for a standardized platform could mean closing the door on customized financial workflows a company has developed.
For example, an off-the-shelf platform may not have the option of accommodating the accounting rules of highly specialized industries. It may have a predefined chart of accounts structure that doesn’t fit the structure a company has traditionally used. It also may be limited in the formats that can be used for financial reporting, which could require business leaders to make peace with reports that don’t fit their personal tastes.
To avoid big problems that can surface after shifting to off-the-shelf solutions, companies should make sure to take their time and seek software that can scale with their plans for growth. Like any other technological innovation, AI is a tool meant to support and not supplant a company’s processes. The process of selecting an AI platform to improve accounting efficiency begins with mapping out a company’s unique process and identifying where AI can boost efficiency. If the platform you are considering can’t deliver, keep looking.
AI best practice: Take it slow and learn as you go
The biggest temptation for companies as they begin to embrace AI will likely be doing too much too fast and with too little oversight. Artificial intelligence is a remarkable tech tool, but still in its infancy. Taking advantage of its capabilities also requires managing some risks.
For example, AI has what some experts describe as an “explainability” problem. Developers know what AI can do but don’t always know how it does it. Companies that feel compelled to provide their clients or stakeholders with a solid explanation of the process behind their AI automations may be limited in how they can put AI to work.
Now is the time to begin integrating AI with your company’s accounting efforts, but take it slow and learn as you go. A solid best practice is to explore what is available, experiment with how it can help your business, and expect to make many adjustments before you arrive at an optimal process. Your accounting efforts will serve you best when they combine human and artificial intelligence.
Ascend, a private-equity backed accounting firm, added a vice president of partnerships to its leadership team.
Maureen Churgovich Dillmore will oversee the expansion of Ascend’s growth platform for regional accounting firms into new U.S. markets, effective Feb. 17. She was previously executive director of the Americas at Prime Global. Prior, she was executive director at DFK International/USA.
“I have dedicated a large part of my career to supporting firms that want to remain independent. The dynamics of achieving success in this area are evolving rapidly, and the Ascend model was created so that firm identity would not be at odds with accessing the community and resources needed to prosper. I am genuinely impressed by Ascend’s ability to assist mid-sized firms in making the necessary strides to stay relevant, sustain growth, and provide their staff and clients with top-tier shared services—all while preserving their unique brand and culture,” Churgovich Dillmore said in a statement.
Ascend has added 14 partner firms across 11 states since the company launched in January 2023.
“So much of association work is theoretical, advising member firms on best practices, and you don’t get to see the end game. What excites me about being on the Ascend team is the opportunity to be a force behind the change, to help enact the change and see where and how it comes in,” Churgovich Dillmore added.
“Maureen’s decision to join Ascend is rooted in her desire to serve the profession in a way that maximizes her impact. We are all excited to welcome someone into our Company who has been an advisor and friend to mid-sized CPA firms for over a decade, and it is all the more rewarding when you realize that the community and resources we are bringing to life will allow Maureen to have conversations with firms that she’s never had before. Her curiosity, commitment, and deep care for others are going to stand out in this role,” Nishaad (Nish) Ruparel, president of Ascend, said in a statement.
Ascend is backed by private equity firm Alpine Investors and works with regional accounting firms with between $15 and $50 million in revenue. It ranked No. 59 on Accounting Today‘s
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