The broader Accountancy & Financial Services arena will be amongst the first to adapt automation and artificial intelligence in the coming years. And the skills required by the future finance workforce will be mostly focused around digital competency, data analytics and knowledge of automation systems.
For the workforce to successfully evolve and adapt around these changes, finance professionals will need to work hard and seek learning development opportunities if necessary. A PWC report revealed that 47% of CFO’s say their current function does not have the right mix of capabilities to meet its future priorities even 69% say they are aware that automation will change traditional finance tasks.
So, once the workforce adapts to the changes, they will be better equipped to face their competitors, be able to turn data into insights and use automated systems to assist in guide strategy and support decision-making.
The IFS industry currently employs approx. 37,000 people and it is predicted that more than over 45,000 finance people will be employed in 2020.
Embracing finance in the digital world
As mentioned, the most important thing for finance professionals to be aware of, is that digital will change the skillset required of them by 2025, guaranteed. Professionals will be required to research the industry and be comfortable with state-of-the-art technologies that are on the way to being introduced to the finance industry. These technologies include in-memory computing, the cloud, analytics, mobility, artificial intelligence (AI), blockchain and robotic process automation (RPA).
All of these new tools will completely re-shape the finance function.
In fact, there are many benefits to the finance industry becoming automated. PWC found that 40% of finance efforts can be aligned to more value-driven activities through automation. It also found that 35-46% of processing time for several key finance processes (billing, management reporting, general accounting, and budgeting and forecasting) could be eliminated by automation and eliminating waste.
Furthermore, EY published a report which found:
- 58% of people say combining state-of-the-art technology with process improvement will be a major focus for the future finance function.
- 57% of people say that building skills in predictive and prescriptive analytics will be beneficial for the future.
- 65% of people say that standardising and automating processes and building agility and quality into processes will be a significant priority and benefit for the future finance function.
With that in mind, let’s have a look at some of the finance functions that have already been impacted by automation and artificial intelligence.
Finance Functions Currently Being Automated
Accounts payable and accounts receivable: These functions are prone to human error and can sometimes lack in accuracy. Thankfully, RPA has enabled companies to improve accuracy in their accounts payable (AP) and accounts receivable (AR) workflow, such as quick account closure, and reduce the likelihood of human error with technology like optical character recognition (OCR) for paper invoices.
Payroll: Due to the sensitivity of data in payroll, such as an individual’s bank account details, RPA has been introduced as a slower rate for this function. However, process re-engineering means that elements of payroll, such as time-record validation, are starting to be automated in many businesses now.
Tax: RPA has been adopted by many tax teams now, primarily in the areas of tax provision and tax compliance. It can be used to populate VAT amounts or validate information by referencing against a checklist, ensuring an error-free process with shortened pay-back periods.
Accounting: Business processes are now being re-designed with the goal of achieving “continuous accounting”. This is where data is extracted, transformed and loaded automatically into accounts daily. Software robots are also running journal entries, reconciling accounts and maintaining accurate accounting master data.
Due to the changes that are already taking place in the finance industry, there are certain skills that are more in-demand now than ever before. Soft skills will come into place such as adaptability and learning agility. And data knowledge will play a huge role too.
Finance Skills In-Demand
Adaptability – The first and most important skill finance professionals of the future need to have is adaptability. A McKinsey report recently predicted that “Individuals will need to adjust to a new world in which job turnover could be more frequent, they might have to transition to new types of employment, and they likely must continually refresh and update their skills to match the needs of a dynamically changing job market.”
Taking the time to upskill – Despite advances in technology, many teams still use legacy financial management systems that drain resources and time, and don’t provide easy access to data or the depth of insights needed to keep pace with business change. No one becomes a CFO unless they are prepared to challenge themselves. So, it’s important for individuals to step outside their comfort zone by attending conferences on new technologies, volunteering for cross-functional projects and taking on non-financial roles to gain valuable experience.
Be a data junkie – According to the Finance Management Magazine, the finance professional of the future has to be knowledgeable about analytics, have business acumen, and be a good strategist. Furthermore, a different report reported significant shortages of accounting and finance professionals who possess the technical and non-technical skills for data analytics roles. Specifically, these skills included identifying key data trends, data mining and extraction, operational analysis, technological acumen, and statistical modelling and data analysis.
What will be in the impact on International Financial Services?
It would appear that over time many back-office roles will be eliminated through technology advances such as Blockchain, or given to remote workers abroad to cut costs. Thus, Irish financial employers will need to find replacement roles in the IFS to maintain sector growth and employment levels. Staffing in legacy back-office and other primarily administrative roles will also dramatically reduce as Robotics, AI and other new disruptive technologies are introduced to the workplace.
But finance professionals must stay positive and strive to be adaptable, innovative and curious. The future is bright for the industry, but there is still work for Ireland to do if its finance sector is to survive the approaching changes.
For a more detailed discussion about aligning your business with talented Financial professionals or to discuss your career, speak to Paul McClatchie, Engage People.
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