Why AI in accounting needs more than just technology

Artificial intelligence is redefining the accounting profession, but not in the way most imagined. While AI’s ability to automate tasks, analyze entire datasets, and identify anomalies in financial records is undoubtedly a breakthrough, the real challenge for accountants is not just in adopting AI—it’s in exercising professional judgment amid the growing reliance on machine-generated insights.

According to the latest AI Monitor report from the Association of Chartered Certified Accountants (ACCA), Risk and Responsibility, AI presents both an opportunity and a risk.

The technology augments human capabilities, but it also introduces new layers of complexity when it comes to control, reliability, and professional responsibility. And as organizations invest heavily in AI, the question remains: Do they fully understand what it takes to integrate it effectively?

The Risks of AI: Misplaced Trust and Unrealistic Expectations

Despite the enthusiasm surrounding AI, the ACCA report cautions against misplaced confidence in its capabilities. Many organizations face immediate risks—not from AI itself, but from human miscalculations about its potential impact.

One of the biggest pitfalls? Assuming AI is an infallible replacement for human expertise. Accountants, who have long played a role as stewards of financial integrity, must now navigate a landscape where AI-driven recommendations are only as good as the data and algorithms that power them. Poor judgment in interpreting AI-driven insights can lead to significant financial missteps, regulatory violations, or ethical dilemmas.

Beyond financial controls, AI also challenges traditional accounting concepts. Take materiality, for example—a cornerstone of financial reporting. AI’s ability to analyze entire datasets, rather than just samples, raises new questions about risk assessment and professional skepticism. If AI can surface every anomaly in a dataset, how should accountants determine what truly matters?

The Role of Professional Judgment in an AI-Driven Future

What the ACCA emphasizes is that AI does not diminish the need for human judgment—it elevates it. AI can process volumes of financial data at unprecedented speeds, but it cannot exercise professional skepticism, contextualize findings, or make ethical decisions. These remain uniquely human responsibilities.

The report suggests a three-layered approach to AI risk management, in which accountants play a central role:

1. Data Integrity: Ensuring the quality, accuracy, and ethical use of financial data that AI relies on.
2. Architectural Oversight: Understanding how AI models are built, the assumptions behind them, and their potential biases.
3. Business Impact: Evaluating AI-generated insights within the broader context of financial strategy, regulatory compliance, and organizational risk.

Why AI Won’t Replace Accountants—But It Will Change Them

As AI capabilities expand, so do regulatory expectations. Emerging standards will likely require greater transparency in AI-driven financial decision-making, reinforcing the need for accountants to document and demonstrate how they apply professional expertise alongside AI tools.

“Safely introducing AI into how organizations work and make decisions isn’t just about technology—it’s about redefining how we exercise things like professional judgment,” said Alistair Brisbourne, head of technology research at ACCA. “Success will depend on striking the right balance: leveraging AI’s analytical power while strengthening professional expertise.”

For accountants, this means adapting their roles—not just by learning AI’s technical mechanics but by shaping how organizations integrate it responsibly. They don’t need to be AI specialists, but they do need frameworks that ensure consistency in risk management, compliance, and ethical considerations.

A Smarter, More Accountable Use of AI

As AI becomes an integral part of financial reporting, corporate audits, and risk assessments, organizations must go beyond automation hype and build robust oversight mechanisms. That means investing not just in AI tools but in the people who can interpret their outputs with critical thinking and sound judgment.

The role of accountants is evolving, but it is not diminishing. If anything, AI is making professional judgment more valuable than ever. Those who can blend technological oversight with financial expertise will not only safeguard their profession—they will define its future.