Marc Jeschonneck of EY highlights the transformative impact of AI on the auditing profession, urging careful implementation and training

The accounting profession stands at a critical juncture, where embracing artificial intelligence (AI) is no longer optional but essential for staying competitive. Marc Jeschonneck, EY’s global assurance digital leader, emphasized in a recent interview that AI has “dramatically changed” the auditing field after 15 years of investment in the technology. As EY invests $1 billion to equip 130,000 of its global staff with AI tools, Jeschonneck warns that those in the accounting profession who choose to ignore AI advancements may find themselves at a significant disadvantage.

Jeschonneck underscored the importance of trust in AI and machine learning within audit processes, though he acknowledged that trust in these technologies is never absolute. The accuracy of AI-driven audits is crucial, and organizations must approach AI implementation with a strategic perspective. According to Jeschonneck, the success of AI tools in auditing depends heavily on the quality of data fed into the system and the thoroughness of the training provided to professionals before rolling out these tools.

“It’s critical to be confident in the AI systems, just as it is with data analytics. The data underlying these tools must be trustworthy,” Jeschonneck stated. He added that if the initial setup and due diligence are executed correctly, the machine’s output should reflect that precision, reducing the need for double-checking results.

Analysis:

Political:

The integration of AI into auditing is not only a technological shift but also a regulatory challenge. Governments and regulatory bodies must establish clear guidelines to ensure AI tools are used responsibly within financial auditing. As AI becomes more entrenched in the profession, regulators will need to adapt to oversee these technologies effectively, ensuring that ethical standards and data privacy laws are upheld.

Social:

AI’s rise in accounting raises questions about the social impact on the profession. While AI can handle complex data analysis with greater accuracy and efficiency, it also risks displacing human accountants. However, Jeschonneck’s emphasis on training highlights the opportunity for accountants to upskill and transition into roles that focus on overseeing and interpreting AI-generated data. The profession may shift towards a more collaborative model, where human expertise and AI capabilities complement each other.

Racial:

The implementation of AI in accounting must be approached with an awareness of potential biases in the technology. AI systems can unintentionally perpetuate racial and cultural biases if the data used to train them is not sufficiently diverse. As the industry adopts AI, there is a responsibility to ensure that these tools do not reinforce existing inequalities. Jeschonneck’s focus on the integrity of underlying data suggests that EY is aware of these challenges and is working to mitigate them.

Gender:

The gender dynamics within the accounting profession could be influenced by the adoption of AI. Historically, technology fields have seen gender imbalances, and there is a risk that the rise of AI in accounting could exacerbate this trend. However, with proper training and equal opportunities for skill development, AI could also empower women in the profession by providing tools that enhance their efficiency and decision-making capabilities. EY’s investment in AI training for its staff could serve as a model for ensuring gender equity in the digital transformation of accounting.

Economical:

From an economic standpoint, AI’s integration into auditing represents both a cost and an opportunity. The $1 billion investment by EY demonstrates the significant financial commitment required to stay at the forefront of the profession. However, this investment is expected to yield long-term returns by increasing efficiency, reducing errors, and enhancing the quality of audits. Firms that fail to adopt AI may find themselves at a competitive disadvantage, as clients increasingly demand the accuracy and insights that AI can provide.