AI tools for accountants: a practical small firm guide
Choose ai tools for accountants around one recurring job, such as preparing invoice data, checking a working paper or drafting an explanation from approved figures. Start with a small document pack, compare the output with a checked answer and keep a named accountant responsible for accepting the result.
My starting question would be simple: where does your team spend time preparing information that somebody else must then check? Write down that task before booking demonstrations. Use this guide to turn it into a buying decision you can explain to your team.
Which AI tools belong on an accountant's shortlist?
Separate general assistants, tools inside your existing workspace and specialist accounting products. Give each candidate a job it can demonstrate. Avoid asking a single product to win an undefined competition for the best accounting AI.
The Journal of Accountancy describes firms using AI for data preparation, risk assessment and working paper review. Its examples include Microsoft Copilot and tools built inside firms. Treat those examples as possible workflows to investigate. Read the firm interviews.
| Candidate | Suggested evaluation | What to challenge |
|---|---|---|
| ChatGPT or another general assistant | A checklist or explanation using fictional records | Does it separate supplied facts from suggestions? |
| Microsoft Copilot | A demonstration around your team's spreadsheet work | Is the required capability available in your environment? |
| CoCounsel Tax or Audit & Accounting | A research task with inspectable references | Do those references cover your jurisdiction and question? |
| Audit Intelligence Test | Matching transactions with supporting evidence | How are partial receipts and exceptions presented? |
| Ready to Review | A demonstration for a practice handling US 1040 returns | Does the supported return type match your work? |
These are evaluation suggestions, not claims that every product suits your practice. Accounting Today describes Ready to Review as supporting 1040 preparation and Audit Intelligence Test as matching samples with supporting evidence. Its coverage also describes CoCounsel research and document workflows. See the reported product scope.
Define the terms before the demonstration
For this evaluation, use “AI assistant” to mean a tool you ask to prepare a response. Use “agent” for a system configured to carry out a sequence of actions. Ask the seller to name those actions and show where a person can stop them.
Make your first comparison deliberately narrow. For spreadsheet preparation, use the task design in automating Excel work with AI. Keep the original workbook and review the proposed changes in a separate copy.
Where should you start with bookkeeping automation?
Start with a preparation task whose answer you can check against the original records. My preferred first exercise is an invoice register. Decide the required fields before introducing any automation.
Build a deliberately imperfect test pack
Hypothetical example: a small online retailer wants help preparing supplier invoices for review. Create fictional invoices containing an ordinary purchase, a duplicate copy, a missing date and a credit note. Prepare the correct register yourself before testing the tool.
Ask for document name, reference, date, currency, amount and an unresolved-question column. Preserve each original document reference. Tell the assistant to leave missing information unresolved rather than complete it from context.
Prepare a review register from these documents. Keep one row per document and retain the source filename. Show the reference, date, currency, amount and location of each extracted value. Flag possible duplicates without deleting anything. Mark unreadable fields as unreadable. Do not create accounting entries.
- Count the documents and compare that count with the register.
- Check every amount against its source.
- Inspect the credit note separately.
- Review proposed duplicates before taking action.
- Record unresolved fields for follow-up.
For expense intake, continue with the expense tracking workflow. Keep receipt collection, extraction, approval and posting as separate steps in your written procedure. Assign an owner to each step before connecting systems.
How should AI support audits and financial reporting?
Give it a specific review question and require an inspectable trail back to the evidence. “Check this report” is too loose for a useful acceptance decision. Specify which totals, references or explanations need attention.
Keep observations separate from conclusions
Hypothetical example: a service business has a customer payment that may cover several invoices. Ask for proposed allocations, the supporting references and the amount left unallocated. Require the reviewer to accept each proposed match before changing the records.
Work through partial payment matching to prepare your expected answer. Then test whether the tool preserves the distinction between a possible match and a confirmed allocation. Do not let a plausible explanation close an unresolved item.
For a bank exercise, use the bank reconciliation example as a separate practice task. Ask the assistant to list questions about unexplained differences. Leave the decision about any adjustment with the accountant reviewing the supporting records.
Draft the commentary only after checking the figures
For AI for financial reporting, supply an approved table and request a short management explanation. Ask for three things: the change shown, the information still missing and the question the owner should answer. Require every numerical statement to identify its source row.
Review the wording as carefully as the numbers. Remove any explanation that goes beyond the supplied evidence. Save the approved commentary separately from the draft, with the reviewer's name and the version used.
What should you check before using AI tax preparation tools?
Confirm the country, return type and supported workflow before considering a purchase. Set your first tax exercise around document preparation or a research question. Keep the final calculation and filing decision under an explicit review process.
Thomson Reuters presents CoCounsel Tax as a research and client-deliverable product and CoCounsel Audit & Accounting as an audit workflow product. Those are supplier descriptions, not independent results for your practice. Read the supplier announcement.
Ask the vendor to demonstrate a question relevant to your actual clients. Inspect the cited material and check whether the answer addresses the facts you supplied. If coverage is unclear, keep the tool outside the final tax decision.
- Write the jurisdiction and reporting period into the task.
- Keep source documents attached to the review record.
- Separate supplied facts from assumptions.
- Assign unresolved questions to a qualified reviewer.
- Reconcile accepted figures before submission.
Do not evaluate tax software by the confidence of its prose. Ask what happens when a document is missing or two records conflict. A useful demonstration should show that exception as clearly as the ordinary case.
How do you choose an AI tool for a small accounting firm?
Compare two candidates using the same task and the same checked answer. Set the acceptance conditions before seeing either result. Include review effort and data handling in the decision from the beginning.
Ask for written answers about client data
Before uploading client material, ask where files are stored, who can access them and how deletion works. Ask whether your input can be used for model training and which contractual terms govern that use. Resolve unclear answers with your firm's responsible person.
Use fictional or appropriately approved records while those questions remain open. Avoid treating a product name or subscription label as a substitute for checking the actual settings and terms. Make access removal part of the exit test.
Score the completed job
Record preparation time, review time, corrections and unresolved items. Add subscription and setup costs to the comparison. Where a result cannot be used, include the time required to finish the task through your existing process.
Use three outcome labels: accepted, needs correction and unusable. Record why each result received its label. This gives the next reviewer something concrete to inspect instead of a vague impression that one tool felt better.
For training, adapt the team AI training plan to the selected accounting task. Have a second colleague repeat the exercise using the written instructions. Revise any step that depends on knowledge you forgot to document.
What should your first week look like?
Choose one recurring task and one person to own the pilot. Keep its output outside live posting until the review is complete. Aim to finish the week with a clear decision about this task, rather than a general opinion about AI.
- Monday: document the existing process and record how long a completed, checked example takes.
- Tuesday: prepare the test pack and expected answer, including missing and conflicting information.
- Wednesday: run both candidates with identical instructions and save their original outputs.
- Thursday: review the results, record corrections and test whether another colleague can follow the instructions.
- Friday: decide whether to continue, narrow the task or stop.
Write the stop conditions in advance. For this pilot, reject outputs that silently omit documents, invent missing values or lose the connection to supporting records. Investigate the cause before repeating the same test.
Document the handover as well. State who prepares the input, who reviews it and who handles unresolved questions. Use the standard operating procedure guide to turn the accepted workflow into a short instruction sheet.
What do small firms ask before starting?
What AI tools can accountants use?
Build a shortlist of general assistants, Microsoft Copilot and specialist products suited to your work. Compare them on a defined task, inspectable evidence, review effort and data requirements.
How does AI help with bookkeeping and audits?
Evaluate it on preparation, proposed matching and review questions. Measure the time needed to finish and check the work, including corrections, rather than the time needed to produce a response.
How do I choose an AI tool for a small accounting firm?
Test two candidates with the same records and acceptance conditions. Include setup, training, review, data handling and the ability to export your work in the decision.
Should an AI result go straight into a tax return?
I would require a separate review before accepting it. Check the jurisdiction, reporting period, supporting records and calculations, then have the responsible professional approve the final return.
Which sources should you inspect?
Use these pages to understand the reported workflows and product scope. Use your own controlled exercise to judge suitability. Keep supplier descriptions distinct from evidence collected inside your practice.
