Increasingly, enterprises need to find ways to be nimble when it comes to operations, saving time and money.
The conversation came against the backdrop of Vic.ai announcing $50 million in Series B funding, which will boost the adoption of its artificial intelligence (AI) platform designed to help companies streamline invoice processing, among other activities.
As Hagerup told PYMNTS, accounting is ripe for AI’s embrace.
Autonomous accounting, he said, should not be confused with the actual automation of accounting functions. The automation of those functions are template-based, pre-programmed and do not adapt to flexible, fluid environments that confront enterprises on a day to day basis.
“Accounting is inherently number based, but there are endless permutations and fine distinctions that, up until now, require trained accountants to make judgements,” he said. Large enterprises spend anywhere from millions to tens of millions of dollars per year on financial transaction processing and classification. Template-based automation means that human must fix every exception and review results. But platform models, including Vic.ai’s own offering, can digitize the work that had previously been shouldered by individuals and by teams.
The challenges are there, he said, as invoice processing remains a technical hurdle. That’s especially true for verticals such as retail, healthcare, hospitality and real estate — which are among Vic.ai’s areas of focus.
“These industries inherently have a large number of invoices to process — and generally, a company processing more than 100,000 invoices per year is a great fit” for AI-driven solutions, he said.
Separately, in the “Strategic Role of the CFO Playbook,” done in collaboration between PYMNTS and Versapay, more than 400 chief financial officers found that 92% of firms are digitizing their accounts receivable and accounts payable processes. As many as three-quarters of businesses with revenues between $25 million and $100 million said that late payments have been exacerbated due to the pandemic. Increased days outstanding also has been a problem for 60% of smaller firms, the study found.
Each Invoice is Different
“Every invoice looks different — ingesting and understanding all invoices can be complicated for a rule-based solution, limited by the pre-programmed templates,” maintained Hagerup. “When leveraging artificial intelligence, we can have the technology apply reasoning and strategize on the data, and that’s when you can achieve autonomous accounting.”
Pointing to his own firm’s technology, he said algorithms can reason on behalf of accounting teams and also adapt to new requirements. He said the high-tech solutions can handle any type of invoice, read them, and classify invoice numbers and the correct costs involved.
The company said in its funding announcement that its AI platform has, to-date, processed more than 535 million invoices with 95% accuracy, where more than 2,000 corporate finance and accounting clients, as a result, have achieved nearly $70 million in cost savings and six million hours in time savings.
He offered reassurance that even in the age of automation, there still is room for the human touch.
“Accountants still play a critical role, but instead of focusing much of their time and energy on mundane, repetitive tasks, their day-to-day work can shift to higher-level, more valuable jobs and opportunities,” said Hagerup.