The future is now, bringing with it a paradigm shift in finance. The days of manually sifting through Excel sheets are gradually fading away. The rapid progress of AI technology has made it evident that automating finance functions in companies is inevitable. CFOs hesitant to embrace digital transformation must step out of their comfort zones and acquire new digital skills or risk facing irrelevancy in their industry.

According to a recent study by Gartner, the rise of AI and automation will have a significant impact on the hiring practices of top-performing companies in the finance sector. It is predicted that 50% of new finance employees hired by these companies will have backgrounds other than finance or accounting, widening the digital skills gap between management, particularly CFOs, and the new generation of finance professionals. CFOs who are not actively learning new digital skills risk struggling to lead their teams effectively. A solid skillset and understanding of technology are crucial for navigating the changing landscape of finance and staying competitive in the industry.

How Emerging Technology is Impacting the Finance Sector

The accounting industry has witnessed a remarkable integration of technological advancements in recent years. Robotic process automation (RPA) and artificial intelligence (AI) have revolutionized mundane financial tasks, streamlining processes such as invoicing, accounts payable and receivable, and reconciliation. By automating these routine tasks, finance professionals have been liberated from laborious manual efforts, allowing them to redirect their focus toward more strategic and value-added initiatives.

The implementation of advanced AI technologies has extended beyond automation, empowering financial planning and analysis. By leveraging AI's capabilities to process and analyze vast volumes of data, organizations can extract actionable insights for informed and strategic decision-making. The utilization of AI in financial forecasting enhances the accuracy of revenue, expense, and cash flow projections, enabling businesses to make more precise and reliable forecasts.

Looking ahead, as the trajectory of technological evolution continues, AI is expected to play an increasingly pivotal role in various areas of accounting. It has the potential to contribute to risk management, fraud detection, regulatory compliance, tax planning, and even decision-making processes related to investments and credit.

Staring into the Unknown: Deciphering the Role of ChatGPT

Earlier this year, OpenAI's ChatGPT made waves in the corporate landscape, garnering widespread attention for its multifaceted capabilities in data analysis, creating business reports, crafting compelling marketing content, and even generating software code. This impressive tool has undoubtedly captured the interest of CFOs globally.

However, alongside its allure, CFOs find themselves grappling with concerns and challenges related to this advanced technology.

A few major concerns include:

• Data Security: ChatGPT processes and generates responses based on large amounts of data, which may include sensitive, confidential or proprietary information.
• Quality Control: As an AI language model, ChatGPT generates responses based on patterns and information it has learned from its training data. However, it may occasionally produce inaccurate or misleading information.
• Legal and Compliance Considerations: Content generated may not adhere to a company’s legal requirements, regulatory compliance and ethical standards. It may also create potential legal or reputational risks if the content used contains misinformation or is used without regard to data privacy.
• Necessity for AI Understanding: As technology providers increasingly incorporate AI into their products used by finance functions, whether they have been thoroughly tested or simply to stay "AI relevant," businesses will need to dedicate significant time and effort to comprehend and effectively utilize these AI-infused solutions in the foreseeable future.

As ChatGPT and similar AI language models continue to advance, CFOs are urged to maintain a prudent and open-minded approach, ensuring a comprehensive understanding of both how to effectively harness the tool's potential and how to savvily navigate around potential pitfalls.

How CFOs Can Ride the Technological Wave

In order to thrive in the digital revolution, CFOs must proactively embrace the transformative changes that lie ahead. It is imperative for them to not only comprehend the intricacies of how technology will revolutionize and influence the finance function but also to cultivate their own digital skill set.

A crucial initial stride towards this endeavor involves engaging in continual discovery and education to stay abreast of the evolving landscape of automation and technological tools specifically designed and marketed for the finance sector. By remaining attentive to emerging trends and acquiring a deep understanding of these tools, CFOs can position themselves as catalysts of change and seize unparalleled opportunities by formulating strategies to leverage digital innovations and optimize financial processes.

A strong foundation in data analytics is also crucial for CFOs in the digital era. The ability to harness the power of data-driven insights empowers CFOs to make informed decisions, identify trends, and uncover valuable patterns or correlations. By acquiring proficiency in data visualization techniques, statistical analysis, and predictive modeling, CFOs can unlock the true potential of data and transform it into actionable intelligence. This proficiency not only enhances financial decision-making but also enables them to provide valuable insights to other stakeholders across the organization.

Embracing digital upskilling and adopting a mindset aligned with the technological wave doesn’t need to be daunting or convoluted for CFOs. Instead, it requires a commitment to self-education and cultivating an open mind to explore and embrace new digital skills and technologies. By approaching this endeavor with a sense of curiosity and continuous learning, CFOs can confidently navigate the digital landscape and harness its vast potential for driving financial excellence.

Copyright © 2023, CBIZ, Inc. All rights reserved. Contents of this publication may not be reproduced without the express written consent of CBIZ. This publication is distributed with the understanding that CBIZ is not rendering legal, accounting or other professional advice. The reader is advised to contact a tax professional prior to taking any action based upon this information. CBIZ assumes no liability whatsoever in connection with the use of this information and assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

CBIZ MHM is the brand name for CBIZ MHM, LLC, a national professional services company providing tax, financial advisory and consulting services to individuals, tax-exempt organizations and a wide range of publicly-traded and privately-held companies. CBIZ MHM, LLC is a fully owned subsidiary of CBIZ, Inc. (NYSE: CBZ).