The Future of AEC Accounting: The Impact of AI and Autonomous Finance

Explore how AEC firms can transform their financial operations by embracing autonomous finance, AI, and machine learning.

View On-Demand: Change is Coming to AEC Accounting

Driven by the emergence of AI and autonomous finance capabilities, the accounting landscape in Architecture, Engineering, and Construction (AEC) firms is undergoing a significant transformation. As accounting teams grapple with increasing complexities and the need for efficiency, embracing emerging technology is becoming essential. The adoption of advanced solutions like artificial intelligence (AI) and machine learning will redefine how AEC firms manage their financial operations, paving the way for enhanced productivity, agility, and profitability.

Understanding Autonomous Finance

Autonomous finance refers to the use of AI and machine learning to automate financial processes with minimal human intervention. This paradigm shift is not just about reducing workloads; it’s about fundamentally changing how financial tasks are performed. By automating routine accounting functions, firms can free up valuable resources to focus on strategic initiatives rather than mundane bookkeeping tasks. The potential benefits of autonomous finance are substantial. According to Gartner, there are significant efficiency benefits to its adoption:

40%
Decrease in the cost of finance with the implementation of these technologies
20% to 40%
Reported productivity improvements
Up to 90%
Operational cost reduction by automating accounts payable

Traditional Challenges in AEC Accounting

AEC firms have traditionally faced several overarching challenges that impede their financial operations. Many organizations continue to rely on disconnected systems that lead to inefficiencies and lack of visibility. Manual processes pervade the accounting lifecycle, from transactional processes to reconciliations and financial reporting, resulting in wasted time and resources.

Firms must shift from simply entering data to actually utilizing data more effectively to drive the business. Integrating and automating accounting processes is vital for enhancing operational efficiency, meaning that AEC firms need a robust platform that consolidates data management and supports real-time visibility and decision-making.

The Role of AI in Financial Processes

AI-powered solutions like Microsoft’s Dynamics 365 and aec360 are revolutionizing how AEC firms handle their finances. The incorporation of AI allows for the automation of key accounting functions such as accounts payable (AP) processing, banking, period close management, and financial reporting. By employing AI-driven process automation, these processes can run largely unattended in the background, helping firms to minimize manual interventions, reduce errors, and streamline workflows.

For example, the Accounts Payable process has traditionally involved many labor-intensive steps, including manual data entry and invoice approvals. With AI, firms can automate invoice ingestion, extract critical information, automatically set up and code AP invoices, and route approvals with minimal human oversight. This shift not only accelerates the AP process but also enhances accuracy, ultimately leading to faster financial close processes.

1. Streamlined Accounts Payable

AI-driven solutions can significantly reduce the time and cost associated with processing AP invoices. By automating invoice recognition and approval workflows, AEC firms can process AP invoices faster and reduce internal labor costs. Studies indicate that manual AP processing can cost firms over $16 per invoice; AI can largely automate this process, dramatically reducing these costs.

2. Enhanced AR and Cash Flow Forecasting

AI-based machine learning algorithms can analyze historical customer payment data to predict when clients are most likely to settle their invoices. This predictive capability allows firms to manage cash flow more effectively, ensuring they can meet operational needs without interruption.

3. Automated Month-End Close

The financial period close process can be cumbersome, often relying on manual task lists and offline tracking. By adopting an online close checklist powered by AI, firms can automate many of these tasks, ensuring timely closes and accurate financial reporting.

4. Banking Automation

Automating banking processes allows firms to download bank statements and reconcile accounts seamlessly. By integrating AI, firms can manage cash receipts and automatically match invoices, streamlining financial operations and minimizing manual errors.

Getting Started with Autonomous Finance

To embrace the future of AEC accounting, firms must first learn more about these emerging technologies and their potential applications. A key step is identifying the most inefficient processes within the accounting department and targeting them for automation. This problem-driven approach ensures that the technology implemented provides tangible benefits.

Management buy-in is also crucial for successful transformation. As firms invest in modernizing their financial systems, they must also redefine team roles and responsibilities to account for gaps in skills and technical know-how. This will most likely involve transitioning from traditional bookkeeping roles to specialized positions that focus on more advanced strategic financial planning and analysis.

Discover more about how to get started with autonomous finance in our blog Embracing Autonomous Finance: A Guide for AEC Firms

In Conclusion

The future of AEC accounting lies in embracing autonomous finance. By integrating AI and machine learning into financial processes, firms can improve efficiency, reduce costs, and enhance decision-making capabilities. As the industry continues to evolve, those who adapt to these changes will not only survive but thrive in a competitive landscape.

Now is the time for AEC firms to explore the potential of autonomous finance solutions. By leveraging advanced technologies, organizations can transform their financial operations, paving the way for greater agility and profitability in the years to come.

Reach out to us today to learn how HSO can assist in navigating this transition and help your firm unlock the full potential of autonomous finance.

On Demand Webinar
Change is Coming to AEC Accounting: Is Your Firm Ready?

This webinar highlights key trends in finance and accounting technology and help future-proof your firm’s financial practices by embracing automation and AI tools to optimize key process around accounts payable, banking, financial close and reporting procedures, and much more.

Change is Coming to AEC Accounting

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