HOW CAN ACCOUNTANTS USE CHATGPT
In today’s world a new wave of software is making ground-breaking history. ChatGPT, from AI startup Open AI, is an AI-powered chatbot whose level of sophistication has taken the business world by storm like no other chat platform before it.
What is Chat GPT?
ChatGPT is an Artificial Intelligence (AI) chatbot, GPT stands for Generative Pre-training Transformer, a language model that can generate human link text in a conversational context. By using approximately 175 billion parameters, the technology is remarkably effective in generating everything from legal briefs to Shakespeare-style poetry, to high-school essays instantly.
It is a sophisticated machine learning model designed to answer questions on almost any topic you can think of. That includes audit and accountancy as well.
How can Accountants use ChatGPT?
AI is now being used in different fields such as accounting. AI (artificial intelligence) and NLP (natural language processing) advancements with Deep Learning have been happening for a number of years. GPT models are the new age models that also use deep learning to produce human-like text. There have been many series of GPT models so far: GPT-1, GPT-2, GPT-3, GPT-3.5. GPT-4
ChatGPT can be a valuable tool for accountants in various ways. Here are a few examples:
- Financial Analysis: ChatGPT can analyze financial data to identify trends, patterns, and potential issues. This can help accountants to make informed decisions about financial strategies, investments, and other important financial matters.
- Tax Compliance: ChatGPT can help accountants to stay up-to-date with the latest tax regulations and compliance requirements. The model can analyze tax laws and regulations and provide guidance on how to comply with them.
- Bookkeeping: ChatGPT can automate certain bookkeeping tasks, such as data entry and categorization. This can save accountants time and reduce the risk of errors.
- Audit Preparation: ChatGPT can assist in preparing for audits by analyzing financial data and identifying potential issues or areas of concern. This can help accountants to prepare for audits more efficiently and effectively.
- Financial Reporting: ChatGPT can help accountants to create accurate and informative financial reports by analyzing financial data and identifying key insights. This can help organizations to make informed decisions based on their financial data.
Overall, ChatGPT can be a useful tool for accountants to analyze financial data, stay up to date with regulations, automate certain tasks, and prepare for audits. It can help accountants to work more efficiently and effectively and provide better insights into their organizations.
- ChatGPT can help craft responses for the back office (invoicing, bill payment, receipt requests, etc.) and accounting questions asked by your clients.
- It can automatically categorize transactions and match invoices with purchase orders, reducing the time and effort required for manual reconciliation. This software can also perform bank reconciliation and generate financial statements, freeing up accountants to focus on more strategic tasks, such as analyzing financial data to inform business decisions.
- It can quickly analyze large amounts of financial data to identify potential risks and opportunities, allowing accountants to proactively address issues before they become a problem. This increased speed also helps businesses to respond more quickly to changes in the market, making them more agile and competitive.
- It can review the financials and provide a summary of business insights. Accountants can then use these insights to recommend corrective actions that general managers and operators could implement.
- It can write qualitative financial report summaries for lenders, investors, and partners by analyzing the financial statements on a monthly, quarterly, and yearly basis.
All of these ChatGPT outputs still need to be reviewed and corrected by an expert, like an accountant, before any correspondence or reports can be sent to the clients or used by stakeholders. While ChatGPT can’t replace human judgment and expertise – it can reduce an accountant’s workload by providing a great starting point.
Limitations and Risks of using Chat GPT
While ChatGPT is a powerful language model that can be used in various applications, it also has some limitations that should be considered. Here are a few examples:
- Biased Data: ChatGPT is trained on large datasets of text, which can contain biases and inaccuracies. This means that the model may generate biased or inaccurate responses based on the data it has been trained on.
- Inaccuracy: ChatGPT can generate responses that are technically correct but do not make sense in the context of the real world. This can lead to inaccurate or irrelevant information being generated by the model, which could result in bad decisions being made.
- Misuse: ChatGPT can be used for malicious purposes, such as generating fake news or impersonating individuals online. This can result in reputational damage, financial loss, and other negative consequences.
- Lack of Common Sense: ChatGPT does not have a true understanding of the world or common sense. This means that the model may generate responses that are technically correct but do not make sense in the text of the real world.
- Limited Contextual Understanding: While ChatGPT can generate responses based on the input it receives, it may not have a complete understanding of the context. This can result in responses that are not entirely relevant or accurate.
- Security Risks: ChatGPT can be vulnerable to security risks, such as data breaches or malicious attacks. This can result in the model being used for nefarious purposes or generating inaccurate responses.
- High Compute Requirements: ChatGPT requires significant computational resources to run, which can make it expensive to use and limit its accessibility to certain users or organizations.
- Ethical Concerns: The use of ChatGPT raises ethical concerns around privacy, surveillance, and the use of AI in decision-making. This includes issues related to consent, transparency, and accountability.
Overall, it is important to consider these risks when using ChatGPT and to take steps to mitigate them. This includes ensuring that the model is used in an ethical and responsible manner, monitoring its performance and accuracy, and taking steps to address any biases or inaccuracies that are identified.
How to start with ChatGPT
To start using ChartGPT follow these 5 steps:
- Navigate to chat.openai.com/chat in your web browser.
- If it’s your first time, you will need to sign up for an Open AI account (it’s free).You will need to provide your email address and create a password
- If you already signed up, you just need to log in by providing your email address and password
- Once you’re logged in, you will see a text box at the bottom where you can type in your message to ChatGPT. You can ask ChatGPT any question or provide any input in natural language.
- After typing your message (for example “How does ChatGPT work?”), press the “Enter” key to send it to ChatGPT.
- You will then see the response generated by the ChatGPT model. The response will appear directly below the text box where you entered your message.
- If you want to continue the conversation, you can type another message and send it to ChatGPT. ChatGPT will respond with a new message each time you send it input.
General tips for using ChatGPT.
- Be clear and specific in your questions.
- Use proper grammar and punctuation.
- Avoid using slang or jargon.
- Ask focused questions.
- Avoid asking multiple questions at once.
- Use keywords
Alia Noor (FCMA, CIMA, MBA, GCC VAT Comp Dip, Oxford fintech programme, COSO Framework)
Associate Partner
Ahmad Alagbari Chartered Accountants