The Future of Accounting: How AI Can Help Tackle the CPA Shortage

In this article we discuss:

• Automating the Mundane
• Enhancing Audit Efficiency and Accuracy
• Streamlining Tax Preparation and Planning
• Improving Client Service and Satisfaction
• Attracting and Retaining Talent
• AI Outlook: The Future of Accounting

Business organizations are facing an existential challenge: an ongoing shortage of certified public accountants (CPAs). As experienced professionals retire and fewer college graduates opt for accounting as a career path, firms are struggling to meet the increasing demand for their services. This talent crunch has far-reaching consequences, from increased workloads and burnout for existing CPAs to potential errors and compromised client service.

Far from being a temporary inconvenience, the CPA shortage is a looming crisis. The American Institute of CPAs (AICPA) has estimated that 75% of today’s CPAs will retire within the next 15 years, far exceeding the number of accounting professionals entering the workforce.

The number of accounting majors graduating from colleges and universities in the United States declined 7.8% in the academic year ending in 2022. And while undergraduate enrollment in accounting programs saw an increase of 12% in the fall of 2024, the AICPA also notes a continuing downward trend in graduate accounting programs.

“There is much work to do to increase awareness and interest in accounting as a major and to sustain that interest through college and into the workplace as students begin their careers,” said Susan Coffey, CEO of public accounting at AICPA. “This ongoing work will be even more critical in the coming years as demographic shifts reshape education and the workforce.”

While a variety of factors have contributed to the growing gap, AI can help, potentially alleviating the CPA shortage and enabling a more efficient and strategic future for the industry. By automating repetitive tasks, enhancing audit efficiency, streamlining tax preparation, improving client service, and making the profession more appealing, AI can significantly alleviate the pressure on finance and accounting teams.

Here are a few ways.

Automate the Mundane

One of the most significant ways AI can help is by automating the tedious and time-consuming tasks that currently consume a large portion of CPAs’ time. Data entry, reconciliation, invoice processing, audit confirmations, and even basic tax preparation can all be handled efficiently by AI-powered systems.

Generative AI, Andreessen Horowitz expects, can improve accountants’ efficiency in data collection, report generation, and insight analysis. Instead of spending hours manually inputting data, CPAs can employ AI to analyze the data, identify trends, and provide valuable insights to their clients.

One of AI’s most important benefits is its potential role in attracting and retaining accounting and finance talent.

Enhancing Audit Efficiency and Accuracy

AI is also transforming the audit process. Traditional audits often involve time-consuming manual procedures, such as reviewing vast quantities of financial documents and transactions. AI-powered tools can automate many of these tasks, from data extraction and analysis to risk assessment and anomaly detection.

Such automation frees up accounting teams to focus on higher-value activities, such as strategic analysis, leading to a more streamlined and efficient audit process. Additionally, AI tools can process and analyze data at a scale and speed far exceeding human capabilities, enabling auditors to identify patterns and anomalies that might otherwise go unnoticed.

Predictive analytics can forecast potential financial risks, allowing auditors to proactively address them. These AI-driven enhancements not only make audits more efficient but also significantly improve their accuracy, reducing the risk of errors and misstatements.

Streamlining Tax Preparation and Planning

Tax preparation and planning are other areas where AI can make a significant impact. AI algorithms can automatically complete tax forms, identify potential deductions and credits that a human might miss, and even develop sophisticated tax planning strategies.

This automation not only saves CPAs time, but also ensures greater accuracy and helps clients optimize their tax liabilities. AI can also keep up with ever-changing tax laws and regulations, ensuring that CPAs are always working with the most up-to-date information.

AI can also enhance tax planning strategies. AI-driven platforms are able to analyze vast amounts of financial data to identify tax-saving opportunities, as well as model different scenarios and predict the tax implications of various financial decisions, empowering businesses to make informed choices that align with their financial goals.

Improving Client Service and Satisfaction

AI can enhance client service in a variety of ways. AI-powered chatbots can answer basic client questions, freeing up CPAs to focus on more complex tasks. Personalized financial reporting, tailored to each client's specific needs, can be generated automatically via AI. Predictive analytics can anticipate client needs, allowing CPAs to proactively offer solutions and advice. AI can help firms win new business, and keep their current clients happy, even in a competitive market.

Attracting and Retaining Talent

There’s little doubt accountants will be in high demand in the near future. The U.S. Bureau of Labor Statistics projects employment of accountants and auditors to grow by 6% from 2023 to 2033—”faster than the average for all occupations.”

For many organizations, AI will likely play an important role in attracting and retaining accounting and finance talent. By automating mundane tasks, AI can make the profession more appealing to younger generations who are looking for challenging and rewarding careers.

Working with cutting-edge technology and focusing on strategic advisory and analysis can be far more attractive than spending hours on repetitive data entry. AI can also create new career paths within the accounting field, such as data analysts and AI specialists, offering exciting opportunities for growth and development.

While generative AI’s ability to create images or write code is well known, AI agents take the technology to another level. David Somers, chief product officer at Workday, said in a recent podcast, “AI agents actually take action. They complete tasks, and they interact in the world around them.”

AI Outlook: The Future of Accounting

AI provides a bright outlook for the future of accounting and finance teams, not just for recruiting and retention purposes, but also for elevating the work they’re able to accomplish. AI technology empowers CPAs to move beyond traditional tasks and focus on higher-value work, such as strategic advisory, financial planning, and data analysis.

Meanwhile, AI can also create new career paths within the accounting field, attracting a diverse range of talent. Accounting teams of the future will comprise tech-savvy professionals, comfortable working with AI-powered tools and using data to develop valuable insights. A growth mindset, continuous learning, and adaptation will be essential to thrive in our evolving world.

“AI will not replace soft skills such as emotional intelligence, communications skills, creativity, and collaborative thinking, which remain vital to providing context and making judgement calls,” writes Kate Duchene, CEO of RGP, a global professional services firm.

While the CPA shortage poses a serious challenge for the accounting profession, AI offers a powerful solution. By automating repetitive tasks, enhancing audit efficiency, streamlining tax preparation, improving client service, and attracting new talent, AI can significantly alleviate the pressure on accountants and finance practitioners and create a more efficient, strategic, and rewarding future for CPAs and their organizations.