A Top Technology Initiative Article, by Randy Johnston. March 2025.
As noted in last month’s column, AI-powered search is a game changer for productivity. While we are still convinced that the most significant productivity gains will be in products that contain AI, programmed and tuned to give you the best results, the new sheriff in town is Agentic AI. What is Agentic AI?
Agentic AI
Agentic AI refers to artificial intelligence systems that operate autonomously and can perceive, reason, plan, and take action to pursue goals. These AI agents can interact dynamically with their environment, adapt to changes, and sometimes make decisions without direct human intervention. Brian Tankersley and I have discussed the integration of AI into products, including agents in the Accounting Technology Lab podcasts. We expect the release of more products integrating AI, including agents, this year and beyond.
Key Characteristics of Agentic AI
- Autonomy. Operates independently, making decisions based on predefined objectives.
- Context Awareness. Understands and processes information from its environment.
- Goal-Oriented. Works towards specific objectives, often optimizing for efficiency or effectiveness.
- Adaptability. Adjusts strategies based on new data or changing conditions.
- Interactivity. Engages with users, other AI agents, or external systems dynamically.
- Planning & Execution. Develops and follows multi-step plans to achieve desired outcomes.
Examples of Agentic AI
- Autonomous Agents. AI-driven chatbots, virtual assistants, and software agents that execute tasks (e.g., Auto-GPT, BabyAGI).
- AI-powered Robots. Machines that navigate and perform tasks autonomously (e.g., warehouse robots, self-driving cars).
- Algorithmic Trading Systems. AI that autonomously makes financial market decisions.
- AI-powered Research Assistants. Systems that generate insights, write reports, and propose actions based on analysis.
How Agentic AI Differs from Traditional AI
- Traditional AI models (e.g., ChatGPT) respond to queries but require user input to take action.
- Agentic AI takes initiative and executes decisions rather than waiting for human direction.
Challenges and Risks
- Ethical Concerns. Risk of unintended consequences when AI makes autonomous decisions.
- Security Issues. Potential misuse in cyber threats or autonomous hacking systems.
- Reliability & Oversight. Difficulty in ensuring AI behaves as intended without errors or biases.
Future of Agentic AI
As AI models become more autonomous, reasoning-driven, and adaptable, agentic AI will play a critical role in automation, decision-making, and digital transformation across industries. We expect this to impact your firm and your clients.
How Could Agentic AI Impact Public Accounting And Financial Services?
Agentic AI has the potential to transform public accounting by automating complex workflows, enhancing decision-making, and improving client service. Unlike traditional AI tools that assist with specific tasks, agentic AI can autonomously initiate actions, manage workflows, and optimize financial processes with minimal human oversight. This evolution presents both opportunities and challenges for accounting firms.
How Agentic AI Impacts Public Accounting
1. Automating Client Accounting Services (CAS)
- End-to-end bookkeeping. Agentic AI will handle full-cycle accounting, including categorizing transactions, reconciling accounts, and preparing financial statements.
- Automated compliance checks. AI agents can continuously monitor transactions for compliance with tax laws, GAAP, or IFRS.
- Cash flow forecasting. AI can analyze trends and autonomously suggest optimal cash management strategies.
2. Enhancing Audit and Assurance Services
- Continuous auditing. Agentic AI can run real-time risk assessments, flag anomalies, and suggest audit procedures without waiting for manual input.
- Fraud detection. AI agents can autonomously analyze large datasets to detect fraudulent transactions or financial inconsistencies.
- Workflow automation. AI can allocate audit tasks to team members, monitor progress, and adjust strategies dynamically.
3. Tax Preparation and Compliance
- Real-time tax calculations. AI can track changing tax laws and automatically apply relevant rules to client returns.
- Proactive tax planning. AI agents can predict tax liabilities and suggest strategies to optimize deductions and credits.
- Automated correspondence with tax authorities. AI could prepare responses to IRS notices and other regulatory inquiries.
4. Client Advisory and Decision Support
- Predictive analytics for advisory services. AI can analyze financial health and autonomously recommend cost-saving measures or investment strategies.
- Autonomous report generation. AI agents can create customized financial reports tailored to specific client needs.
- AI-driven virtual CFOs. AI could act as a virtual CFO, autonomously managing budgets, forecasting, and suggesting operational improvements.
5. Risk Management and Internal Controls
- Continuous risk monitoring. AI can detect financial risks, compliance gaps, and cybersecurity vulnerabilities in real time.
- Automated internal controls. AI can ensure compliance with internal policies and regulations by autonomously enforcing control mechanisms.
6. Client Interaction and Engagement
- AI-driven client communication. Intelligent agents can handle routine client queries, schedule meetings, and send reminders autonomously.
- Personalized insights and alerts. AI can proactively notify clients about financial risks, tax deadlines, or upcoming compliance requirements.
Challenges and Considerations for Public Accounting Firms
1. Ethical & Regulatory Compliance
- Ensuring agentic AI adheres to professional and legal standards (e.g., AICPA, PCAOB, IRS regulations).
- Maintaining transparency and auditability in AI-driven processes.
2. Data Security & Privacy
- Safeguarding sensitive financial data when AI autonomously accesses and processes client information.
- Ensuring AI agents comply with GDPR, CCPA, IRS data security mandates, and new state-level privacy regulations.
3. Human Oversight & Trust
- Balancing automation with human expertise to ensure accuracy and reliability.
- Educating professionals on how to monitor and interpret AI-driven decisions.
4. Integration with Legacy Systems
- Adapting AI solutions to work seamlessly with existing accounting software (QuickBooks, Xero, Sage Intacct, etc.).
- Addressing resistance to adopting AI-driven automation.
5. Liability and Accountability
- Who is responsible when an AI agent makes a financial error?
- Defining the role of accountants in supervising AI decision-making.
The Future of Agentic AI in Public Accounting
Short-Term (1-3 Years)
- Increased automation in bookkeeping, compliance, and report generation.
- AI-driven audits with real-time anomaly detection.
- Hybrid human-AI collaboration in advisory services. An example here might be 4ImpactData.
Mid-Term (3-5 Years)
- AI agents are capable of handling more complex tax strategies and forensic accounting.
- Autonomous CAS systems manage client finances with minimal human input.
- AI-assisted regulatory compliance and litigation support.
Long-Term (5+ Years)
- Fully autonomous accounting assistants acting as virtual CFOs for small businesses.
- AI-driven predictive financial modeling and strategic advisory.
- Potential regulatory framework governing AI-driven financial decisions.
What Are The Tools?
1. Agentic AI Tools for Public Accounting
Several AI-powered platforms and autonomous agents can streamline workflows in CAS, audit, tax, and advisory services.
AI Tools for Client Accounting Services (CAS)
| Tool | Function | Features |
| Vic.ai | Autonomous accounting | AI-driven invoice processing, transaction categorization, and continuous learning |
| Botkeeper | AI bookkeeping assistant | Automates reconciliations, expense tracking, and financial reporting |
| Dext (formerly Receipt Bank) | Document automation | AI-powered receipt and invoice processing with real-time data extraction |
| Relay Financial | AI-powered cash flow management | Automates bill payments, financial insights, and cash flow forecasting |
| Xero AI | Accounting automation | Smart transaction matching, AI-driven reconciliation suggestions |
AI Tools for Audit & Assurance
| Tool | Function | Features |
| MindBridge AI | AI-powered risk analysis | Detects anomalies and fraud risks in financial data |
| CaseWare IDEA | Audit analytics | AI-driven data analysis, sampling, and fraud detection |
| Deloitte Omnia | Audit automation | AI-powered financial statement analysis and continuous audit tracking |
| Cognito Forms + AI | Risk assessment automation | AI-enhanced workflow for internal control audits |
AI Tools for Tax Preparation & Compliance
| Tool | Function | Features |
| Avalara | Sales tax automation | Automates compliance, tax calculation, and returns filing |
| Thomson Reuters ONESOURCE | Corporate tax automation | AI-driven tax compliance, planning, and document management |
| Black Ore Tax Autopilot | AI 1040 tax preparation | AI-driven tax preparation |
| Additive AI | AI-powered K1 processing | Can handle complex and repetitive K1s accurately |
| Thomson Reuters Checkpoint Edge with CoCounsel | Tax Research | Get targeted search results in less time |
| Wolters Kluwer CCH® AnswerConnect | Tax Research | Fast, accurate answers to even the most complex tax and accounting questions |
| Blue J | Tax Research | Instantly delivers verifiable tax answers and drafts high-quality communications |
| TaxGPT | Tax Research | Research taxes, get answers, draft memos, analyze data |
| ChatGPT (via API integration) | AI-powered Tax Q&A | It can be customized to provide real-time tax law updates |
AI Tools for Advisory & Decision Support
| Tool | Function | Features |
| Fathom AI | Financial forecasting | AI-powered financial modeling, KPI tracking, and variance analysis |
| Syft Analytics | AI financial insights | Automated trend analysis, benchmarking, and scenario planning |
| Bizview by InsightSoftware | AI-driven budgeting | Predictive analytics for financial planning |
| FloQast AI | Close process automation | AI-powered financial close workflows and reconciliation tracking |
| 4ImpactData | Business Guidance System | Monitors, predicts, and recommends to improve and leverage your advisory services |
Bottom Line: What’s Next for Agentic AI in Public Accounting?
Agentic AI will redefine traditional accounting roles, allowing firms to shift from transactional work to high-value advisory services. However, governance, ethics, and human oversight will ensure that AI-driven decisions align with professional standards and client interests. In next month’s column, we will look at how to implement Agentic AI in Public Accounting. In the meantime, consider
- Autonomous AI-driven CFO assistants managing financial health for clients.
- Real-time, AI-powered tax optimization adjusting strategies dynamically.
- AI-driven audits with 24/7 compliance monitoring rather than periodic reviews.
- Seamless integration of AI agents with blockchain for tamper-proof accounting
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