Artificial intelligence and corporate finance: what's happening, what's coming... and what to watch out for

By Rebeca Sequeira

In recent years, artificial intelligence (AI) has moved from being a futuristic topic to becoming a part of our daily lives. And in the field of corporate finance and accounting, its impact is already being felt strongly. From automating accounting processes to helping predict financial scenarios, AI is transforming the way decisions are made within organizations.

In this article, we want to tell you what concrete benefits this technology already offers to companies in Costa Rica and Latin America, where the trend is heading, and what warnings the College of Public Accountants is issuing so we don't get caught up in the hype without keeping our feet on the ground.

Applying AI to finance.

This refers to the use of computer systems that can learn from data, recognize patterns, and make decisions (or assist in making them) without the need for specific programming. In simpler terms, they are tools that "learn" how your business works and help you automate tasks, detect errors, or make projections much faster than traditional methods.

What is already being seen in trend.

Many companies, including SMEs, are already using AI in areas such as:

Accounting automation: Repetitive tasks such as reconciliations, invoice review, report generation, and tax verification can be handled by intelligent systems. This frees up your team to focus on analysis and strategy.

Detecting inconsistencies or errors: AI software can review thousands of transactions in seconds and flag unusual transactions, potential fraud, or expenses that don't fit the normal pattern. This reduces the risk of material errors or tax penalties.

Financial projections: Based on historical and current data, these tools can simulate scenarios, estimate cash flow, and warn of potential deviations before it's too late.

Accounting firms are already beginning to incorporate AI into some services. For example, they are testing systems that analyze clients' accounting books and alert them if they detect unusual behavior. This allows for more accurate reviews where needed, without wasting time reviewing things that are correct. AI is also being used to prepare draft financial reports based on the information entered.

What's coming

If AI is already useful today, what's coming next is even more relevant. Here are some trends we're likely to see in the coming years:

• Automatic financial closing: The idea is to eliminate the need to wait until the end of the month to see how the company is doing. With AI, data is updated in real time and financial reports can be viewed at any time.

  
  

• Continuous reviews: You could work with systems that monitor constantly and detect deviations as soon as they occur, instead of reviewing documents once a year.

  
  

• Generative AI in accounting: Technologies like ChatGPT are beginning to help write accounting texts or explain financial results in plain language. This can greatly facilitate communication with partners, banks, or investors.

  
  

• More informed decisions: AI will be able to combine financial data with market, weather, and even social media information to give you a complete view when making strategic decisions.

This all sounds great, and it is. But there are also risks.

The message from the College of Accountants: with caution, but without fear.

The Spanish Association of Accountants has been speaking out loud and clear on this issue. In several recent events, including last year's Accountants' Month, they have emphasized that AI must be used judiciously, ethically, and responsibly.

Some of the warnings they have made are:

• AI can't replace professional judgment. It can help you spot things, but the final decision should be made by someone who understands the business and the regulations.

• Every AI tool must be transparent. That is, you must know where your conclusions come from and be able to explain them to a client or the IRS if they ask.

• Data must be protected. If you give AI access to your financial information, make sure it complies with privacy and security regulations.

• People must continue to educate themselves. This technology doesn't eliminate the need for accounting skills; rather, it requires staying up-to-date on how to use it properly.

Furthermore, the issue is already under discussion at the national level. There are bills in the Legislative Assembly that seek to regulate the use of AI, ensuring that privacy, ethics, and people's rights are respected. There is even talk of possible reforms to the Political Constitution to establish clear principles on how this technology can and cannot be used. In other words, this is no small matter.

In summary

Artificial intelligence is already part of the present of corporate finance, not just the future. At EAS LATAM, we believe that, when used properly, it can help companies work more agilely, with greater security and better data for decision-making. But we also know that it's not just a matter of installing software and forgetting about it: you have to know how to use it, review it, and act responsibly.