Last updated: 23 Feb 2026 10:00 Posted in:
With the frenetic pace of development in artificial intelligence (AI) over the past couple of years, AI is no longer a futuristic concept but a core part of how modern accountancy practices operate. Many firms are moving beyond early experimentation and starting to see the measurable impact these tools can have on productivity, profitability and work-life balance.
Encouragingly, accounting is leading the way. The emergence of accessible generative AI tools such as ChatGPT and Gemini has sparked widespread curiosity, and accountants and bookkeepers have been quick to respond, with 98% now using AI in some form.
More importantly, this isn’t just technology for technology’s sake. Our research, run in partnership with Cebr (The Centre for Economics and Business Research) and Censuswide, found that AI adoption has boosted the UK accounting industry’s profits by £338 million. This is not just a win for the profession; it is also having a ripple effect across the economy – contributing £1.6 billion in gross value to the UK and helping to build a stronger, more resilient economic landscape.
AI represents a significant leap forward for one of the world’s oldest professions. Sixty years ago, accounting relied heavily on manual ledger work, with little client interaction involved. While complete and accurate records remain the foundation of good accounting, AI is now freeing professionals from many of the essential but time-consuming tasks that once defined the role.
The hard-won knowledge and experience of seasoned accountants and bookkeepers can never be replaced by AI. However, technology can take over much of the ‘heavy lifting’, such as scanning statement lines, matching transactions and performing basic financial analysis.
Automating these tasks reduces manual effort, lowers the risk of error, and gives practices time back to focus on more complex and impactful tasks that require human judgment, critical thinking and professional expertise.
This shift is already influencing how practices think about talent. Over three quarters (76%) of UK practices have changed their hiring strategy since the emergence of AI. There is a growing emphasis on so-called ‘left-brain’ or non-traditional skills such as creativity (61%) and communication (63%), alongside increased demand for technical and advisory specialists.
At a time when the industry is facing a talent shortage, embedding AI into your processes can create opportunities to offer more meaningful and engaging work – helping to attract a new generation of talent that may previously have overlooked accounting roles.
With AI helping to lift the administrative burden, nearly half (46%) of accountants are reporting productivity gains. As compliance demands continue to rise and capacity remains under pressure, technology is helping practices not just to work faster, but smarter, by rebalancing where time and expertise are spent.
Modern practices are using AI to save an average of 18 hours and 53 minutes per week – nearly half the typical working week. That’s time back in your pocket to spend in person with a client, helping them to navigate a cash flow crisis or plan for their next chapter of growth.
Much of the recent popularity of AI has been driven by generative AI tools that do more than automate administration – they create new information and content with a simple prompt. However, the real value of AI in accounting often lies in its ability to make sense of large data sets, analyse financial information and prepare forward-looking insights.
More than half (56%) of accountants and bookkeepers believe that AI has driven a breakthrough in their clients’ financial health. They report fewer errors (56%), faster turn-around time (32%) and quicker, improved communication (31%). Together, these benefits enable clearer, more timely financial insights.
As practices benefit from the productivity gains and upskill their teams, these efficiencies flow through to small business clients and, ultimately, the wider UK economy. In short, it is a win-win scenario – which is why building on early momentum is so important.
AI adoption has already built up a head of steam, with many practices starting small – testing a single process, measuring impact and then scaling from there. That approach makes perfect sense but sustaining progress is crucial.
Nearly a third (31%) of practices say that budget constraints are holding them back from using AI more extensively, while 36% cite a lack of training as a barrier. Addressing these challenges requires a clear, structured approach.
Think of your practice like a house with multiple layers. The foundations are your purpose, principles and goals, and they should set clear guidelines for how AI will be used responsibly. Next is the frame – your processes. Map these out and identify where time is wasted or inefficiencies slow you down. Often this will include areas such as bank reconciliation, invoice processing and reporting, all of which can be automated.
Then come your fixtures and fittings: your software platforms. Review whether the systems you use to store and manage client data are secure, robust and fit for an AI-enabled world. It is also important to recognise that employees will have varying levels of confidence and proficiency when it comes to using AI tools.
Ensuring that teams are up to speed on data usage and compliance procedures, while addressing ethical considerations, can ease the transition and prevent issues later on. It can also be worth establishing clear leadership for AI adoption – having an individual or a small team who can help by providing peer support and offering practical guidance on new tools and ways of working to make the transition less daunting.
Training can reduce resistance within practices by demonstrating that AI can become a collaborative partner to employees, not a replacement for them.
Finally, there are the elements that make your practice distinctive. This includes how you communicate with clients, the channels you use, and how you deliver advisory services or bring insights to life. For example, you might automate routine communications such as compliance updates and reminders, freeing up time for more meaningful conversations.
With AI supporting accuracy and insight, you can focus on helping clients to understand what the numbers mean and how to build better-run businesses.
Ultimately, running a healthy business is about preparation – anticipating cash-flow gaps, understanding what lies ahead, and having the ability to adapt. By combining AI-driven analysis with your own experience, judgement and insight, you can help clients make better decisions for their future.
Change can feel daunting, but many of the foundations are already in place. By continuing to deploy AI thoughtfully and purposefully, the profession will be well positioned to benefit from what comes next.
The accounting profession has a long history of evolving alongside technology, and AI represents the next stage in that journey.
Preparing for Making Tax Digital with AI
As the Making Tax Digital (MTD) for Income Tax deadline approaches, Innovi Advisors Ltd is using AI to reduce the administrative burden created by more frequent reporting requirements.
The firm is leveraging AI and automation to build in-house AI agents that manage the process of chasing clients for quarterly filing information. These agents also check submitted data against historical records and internal checklists, using a simple ‘traffic light’ system to indicate the level of human intervention required before information is passed to tax software such as Xero.
By equipping its team with AI-driven tools, Innovi Advisors has significantly reduced the time spent on routine administrative tasks. This has brought staff closer to client outcomes and helped managers to prepare for a future that is more client-facing, advisory-led and focused on leadership rather than process.
Author bio
Kate Hayward
Xero
"AI adoption has already built up a head of steam, with many practices starting small – testing a single process, measuring impact and then scaling from there. That approach makes perfect sense but sustaining progress is crucial."
Kate Hayward, UK Managing Director, Xero