In some respects, the growth and refinement of AI technologies is a wonderful thing. Like many companies, we’ve been experimenting with the many ways that both AI and IT systems can help us improve our processes and deliver a better service. But I’m always nervous when I hear people treating AI as a multi-use tool: the solution to everything from choosing a restaurant to completing your accounts.

On paper, AI and accountancy might seem like natural partners. Granted, accountancy is a rules-based system, dealing with financial data. However, this “method” is just the starting point. It’s also vital to know how the rules apply to you, and – more importantly ­– how to apply them to get the best outcome in an individual situation. This is a skillset developed over years of training.

That’s why it’s so concerning to hear about software automatically producing accounts and calculating taxes. I can understand the temptation here. Using AI seems a far cheaper alternative to paying an accountant; and if you can do it this way, why wouldn’t you? Well, quite simply, because I know an automated approach will cost the end user thousands in extra taxes. More concerningly, because these are savings, rather than expenses, the business will never know what it’s lost.

This doesn’t mean that all automations are a bad thing. Software certainly has its place, and we’ve been the first to champion systems that really earn their place. For years, we’ve advocated for Xero bookkeeping and the advantages it offers, including easy information sharing and the ability to access up-to-date financials. When the Government began rolling out Making Tax Digital, Hive took the bold stance of recommending its knock-on benefits.

It goes without saying, then, that we’ve fully embraced software updates and many new technologies coming onto the market. But for us, each is carefully blended within our systems and services to best focus the time of our expert team members. This supplementary approach allows us to spend more time researching ways to save our clients tax or help them through any number of business challenges. We’re also investing in, and researching, new ways that our clients can harness these automations within their own internal financial systems – essentially road-testing technologies on your behalf.

From the research we’ve done, we know that automation and artificial intelligence has its strengths – but we also know its limitations. One major issue with AI accounting is that it can only digest what you feed it. This means you need to know exactly what to ask, in exactly the right way, to get the answer that’s most helpful. And this will be just one answer to one direct question. The field of focus is narrow, and very specific.

In contrast, the work of a good accountant is always at least partially creative. It involves asking multiple questions and pairing sharp focus with wide-ranging background knowledge. The best accountants draw on empathy, encouragement, and true understanding, which AI simply can’t replicate.

And of course, gathering information and making calculations is just one half of the process. An accountant also knows how to apply this understanding to your situation, and even which steps to take in advance – far ahead of creating your accounts. They’ll talk to you throughout the year, spotting opportunities to make tax savings while you’re still earning your money. These things can only happen in real time. By the time AI is churning out your annual accounts, it’ll already be too late. A year’s worth of chances has passed you by, without you even knowing they were there.

Put simply, getting the best from your accounts relies on using the right tool, in the right way, for the right job. AI can be effective and efficient, but it’s not the solution to every problem. Despite being within the same industry – or even in the same location – no two dental businesses are ever the same. The best possible results can only come from a bespoke approach. And if this leaves you with more money in the long run, why wouldn’t you?

If you’d like to know how much Hive could help you save, compared to other accounting methods, do get in touch – it may be much more than you expect.