Using AI for Financial Reporting: What You Need To Know

The global AI market was worth $391 billion in 2024 alone. That's a $195 billion increase since 2023, and it shows no signs of stopping. On the contrary, more businesses and individuals are adopting AI-enhanced tools in their everyday lives to increase productivity, and efficiency, and improve risk assessment and management.

But how does that translate into finance and accounting operations?

Let’s start by taking a closer look at the main use cases of AI in financial reporting.

Real-time financial reporting and analysis

One of the biggest benefits of AI is that it can track and process financial transactions as soon as they happen. As such, it’s a great tool for delivering real-time insights into a company’s financial information.

You can also use AI to automatically create financial reports on a range of performance indicators such as revenue growth, cash flow, or profitability. AI financial reports can also process and turn complex financial data into visual graphs and charts, helping you easily track and measure financial performance.

Internal audit and fraud detection

AI’s machine learning algorithms can monitor and spot red flags for fraudulent activity within huge amounts of data, in real-time. AI can use both historical data and real-time data to quickly and efficiently spot abnormalities that people may miss. AI can also automate much of the auditing process and do so with fewer mistakes than human beings.

Financial risk assessment

AI is also a great technology for helping to calculate and reduce financial risk. AI can use machine learning predictive models to help assess potential risks for financial loss, often calculating risk far more accurately than traditional statistical methods.

In addition, you can also use AI to set up automatic notifications on areas such as potential liquidity risk, credit risk, and market fluctuations. This makes AI an invaluable tool for helping you to preempt and proactively manage financial risk.

Read our latest article on AI in accounting for more use cases that show how AI can give your business the edge it needs to stand out in today's market.

Below, we explore some of the main ways AI can improve the financial reporting process and show you how to use AI in financial reporting.

Creates financial reports more quickly

On average, people save up to 45-60 minutes per day with the use of AI. One of the main reasons AI is such a great time-saving tool is because of its ability to automate manual processes. 

AI can review and analyse large amounts of disparate data far more quickly and efficiently than the average person. With generative AI capabilities, AI can quickly create financial statements for your team's review.

Supports data collection

AI uses natural language processing to read and process information from a wide variety of different financial documents including bank statements, invoices, and receipts. Through the use of robotic process automation (RPA), AI can also collect financial data previously locked away in data silos, across separate systems and pieces of software, migrating and centralising this data. This dramatically cuts down on the amount of time companies spend on gathering, organising, and processing their financial data.

Provides accurate financial forecasting and budgeting

AI can also help with improving the accuracy and efficiency of financial forecasting and budgeting. Gartner predicts that 50% of companies will replace time-consuming, bottom-up forecasting strategies with AI by the year 2028.

With predictive analytics and the ability to centralise and process seperate sources of data, AI can help make more accurate forecasts. AI can aggregate data from multiple sources, including internal software, historical data, external data, and proprietary sources and predict subtle patterns based on large and complex datasets. The level of complexity and scale at which AI can do this would be incredibly hard for a human being to replicate.

Beyond financial and cash flow forecasting, AI is also a brilliant tool for budgeting as it makes targeted suggestions for better resource allocation and can recommend budgeting strategies based on the entirety of a company’s financial data.

Enhances regulatory compliance reporting

By automatically migrating, centralising, and analysing financial data, AI can help make sure every piece of relevant financial information is accounted for and processed. With manual approaches alone, it’s easy for people to potentially overlook essential documents containing important financial information. In addition, AI’s automation and exceptional processing abilities make it much less likely for mistakes to be made.

Now you understand the benefits, let’s take a look at how you can implement AI into your financial reporting processes.

Identify areas that could benefit from AI reporting

The first step is to review your financial processes and think about which areas you could improve through automation, analytics, or report generation. For example, reviewing our above list, maybe you could use AI for report generation or for more efficient forecasting and budgeting? Make a list of each area you believe could benefit.

It’s a good idea to first focus on one area and observe changes over the following quarter: has the application of AI made things faster or more efficient? What benefits have you seen? Does your team find it easy to use the tool to fulfill goals or achieve set aims?

Look into frameworks and suitable AI models

Once you have your list sorted, it’s time to consider which frameworks and AI models will be the best fit for your tasks and processes. For example, as we cover above, machine learning is a core AI capability, in which AI can analyse large amounts of data and identify patterns and trends that it can use to make future predictions and act on them without being programmed to do so.

This makes it a brilliant tool for financial auditing, fraud detection, forecasting, and generating reports.

While natural language processing can be used to take substantial amounts of unstructured data, such as company financial records and the latest in public financial news, and turn it into synthesised, enriched reports.

Consider using AI-powered software for financial reporting

AI-powered software is a great way to access several of the best AI capabilities and frameworks from a single centralised platform. A great reporting tool can analyse financial data across your company systems, provide in-depth analysis, and automatically create custom reports.

AI can be an essential tool in financial reporting, from providing a detailed analysis of a company’s finances to helping you manage risk and allocate resources more efficiently. While many businesses are slowly adopting the new technology, industry analysis suggests that AI use will be widespread in only a few years. The most innovative and forward-thinking businesses are already using AI to help automate and improve financial reporting. 

Find out more about how our Access Evolve suite of industry-leading software can help you automate and enhance your accounting, especially if you're a medium-sized business. Our unique solution combines functionalities like integrated accounting, payroll, advanced analytics, automated report generation, and easy-to-use budgeting capabilities.