2020 Predictions: RPA, AI set to become everyday tools for UK firms

Experts believe that both the accountancy and audit industries are on the cusp of an automation transformation in 2020, guided by the incredible growth of robotic process automation (RPA) and artificial intelligence (AI) throughout the last few years.

As automation software becomes mainstream technology within the industry, experts from across the field believe that 2020 will be a transformative year as more accountancy firms use both RPA and AI within their practices.

Aaron Harris, Chief Technology Officer at Sage, explained: “At the moment, only big enterprises are employing RPA at scale. In 2020, we’ll start to see this trickle down to small and medium-sized businesses.

“RPA software revenue grew 63.1% in 2018 to $846m and will grow further to $1.3bn in 2019. That makes it the fastest-growing segment in the global enterprise software market, according to Gartner.”

Follow the big leagues’ example

That growth has been championed by early-adopters and large firms, like the Big Four, taking advantage of what RPA can offer both their business and their clients.

Simon Bittlestone, CEO of financial analytics company Metapraxis, explained: “The Big Four are becoming increasingly cautious about partnering up with big businesses due to the fear of being involved in an accounting mishap.

“As a result, both auditors and accountants will be under increasing pressure to adopt analytics technologies that will help protect against the process failures we have seen this year. With this in mind, the application of technology to increase automation of audit processes and analysis of accounting information will have increased focus in 2020.

“The longer the spotlight continues to shine on the industry, the more the audit firms will need to invest in new solutions.”

Bittlestone also suggested that applying a tech-led approach to both financial and management accounting will mitigate errors, and that “AI will help accountancy teams with the heavy lifting of analysis and reporting, and intelligent algorithms will help identify issues and flag errors quickly and easily.”

As previously mentioned, 2019 saw a steady increase in RPA awareness within accountancy, indicating that a tipping point is quickly approaching the industry. If the major industry players are on top of this technology, it should serve as a warning to non-automated firms that they may be left behind.

With the number of large-scale firms who have embraced RPA, it is inevitable that automation will become an everyday office tool as more firms follow suit – and the industry knows that, if it cannot offer something that a competitor can, their chances of survival narrow.

A tool, not a replacement

The increased usage of automation within accountancy and audit means that many accountants have been bombarded with discussions about RPA and AI over the past year – but it is important to note that it is not being discussed as a replacement for accountants, but as a tool for them.

As a timesaving and fact-checking tool, RPA allows accountants to spend more time using soft skills, like problem-solving and communication, and less time in the time-consuming nitty-gritty.

This is particularly important as everyday tasks continue to become more complex, which can lead to more errors. However, it is important to note that this does not mean that RPA and AI will become an all-in-one replacement during 2020.

“RPA is only mimicking human behaviour, not ‘thinking’ like a human,” explained Richard Sampson, SVP EMEA for insightsoftware. “Nevertheless, RPA is a conduit to enabling AI in the future and will be increasingly adopted over the next five years.”

Indeed, 58% of accountants believe that AI and RPA usage will improve their firm, according to a Sage survey, with more joining the digital revolution.

The price point for many forms of automation software has declined throughout the years, although it may continue to be out of reach for very small, regional firms. Deloitte has estimated the average cost for a SME’s RPA to be between £3k and £12k for one bot, but it’s worth noting that there are bots available for under £1k annually.

While the price point for RPA can be high, it has steadily become more affordable year-on-year – a trend that is set to continue into the new year – and acts as a stepping stone into the world of automation.

Marieke Saeij, CEO at Onguard, explained: “Implementing software of this type is a simple step for businesses just starting out on their journey to digital transformation, which we have seen become a major priority for the accountancy industry throughout 2019.”

When is the right time to take the plunge?

Additionally, not all RPA is created equal. Each bot can do something different, so each bot comes at a different price point. Thanks to this, the odds are stacked in favour for firms of varying sizes to find an RPA solution for 2020 that works with their budget and level of expertise.

Understandably, since every RPA solution is different, it does take a bit of time for a firm to decide what software to choose and what processes to automate. Experts have recommended that once a firm investigates their RPA options, they weigh the financial benefit of automating different services.

Harri Lauslahti, Head of Banking & Insurance at Digital Workforce, said: “Automating repetitive manual work will not only help companies to save costs, but actually help accountancy firms to provide better service for their customers with better cost/price ratio.

“These investments are a must to gain competitive edge on the market and to increase the likelihood-sustaining current revenue and gaining more revenue in the future.”

Additionally, thanks to the integration of cloud-based accounting software with many RPA providers, there is a great deal of cross-over between the two applications. This can help mitigate the learning curve and provides even more incentive for firms to embrace RPA.

Giving the industry 2020 vision

While RPA and AI will become more accessible tools during 2020, they will not hit their popularity peak. Rather, this year is set to be a major step forward for the UK accountancy sector as a whole with automation – not a takeover.

“Two-thirds of financial processes are now automated, in one shape or form,” Sage’s Harris explained. “The remaining third is taken up by ad hoc or ‘human’ requests for information. The next step of RPA is to automate those processes too.”

However, Bittlestone warns that firms who take too long to join the automation revolution risk mistakes going unnoticed and, potentially, multiplying.

“The swathe of high-profile accounting failures in 2019 clearly demonstrate the need for change of process in accountancy,” Bittlestone said. “Without analytics technology, accountants won’t be able to benefit from near real-time insights, and rather will spot issues retrospectively, when nothing can be done – which, as we have seen, can be fatal.”

If your firm is looking into automation solutions, Accountancy Age has several resources and articles on the topic to assist your business’ transition.