As AI gets smarter, it’s time for accountants to admit it… ChatGPT can finally handle many bookkeeping tasks. For owners of very new or very small businesses, this is groundbreaking.
Why would you pay for a bookkeeping service when ChatGPT can do it quickly and for cheap? Because ChatGPT only knows what you tell it, has some privacy and usage concerns, and bookkeeping is only one piece of your financial picture.
At CSI Accounting & Payroll, we’ve provided bookkeeping, monthly financial statements, consulting, and strategic tax services for 60 years. We also stay on top of what AI can do, and what it can’t. Let’s talk about these aspects of using ChatGPT for bookkeeping:
- What ChatGPT can do.
- System issues.
- Accuracy issues.
- Privacy issues.
- Why accounting firms still matter.
What ChatGPT Can Do
If you use ChatGPT’s Business plan, it can help with many aspects of bookkeeping, such as:
- Categorizing transactions.
- Suggesting journal entries.
- Explaining accounting concepts.
- Helping reconcile accounts.
- Generating financial reports.
- Answering bookkeeping questions.
- Assisting with month-end close.
If used correctly, ChatGPT reduces manual work and speeds up bookkeeping. However, there are still many things it can’t do. Let’s talk about them.
System Issues
ChatGPT is not designed to be a bookkeeping system and doesn’t have built-in safeguards. It’s up to you to follow proper recordkeeping practices.
Ask yourself:
- Where's the audit trail?
- Where are your books stored?
- How are prior periods maintained?
- What happens when transactions change?
- How are attachments organized?
- How are reports generated month after month?
- How do multiple people work from the same records?
Long story short, ChatGPT does not give you the structured general ledger, controls, documentation, and audit trail provided by accounting software, such as QuickBooks or Xero. Use them yourself, or hire a bookkeeping service to do it for you.
Accuracy Issues
ChatGPT has no accuracy guarantees. In fact, right above the prompt bar, it says, “ChatGPT can make mistakes.”
If you have concerns about accuracy, especially as bookkeeping volume increases, they’re valid. The more transactions, accounts, loans, payroll entries, and unusual circumstances you have, the harder it becomes to manage the process reliably through a chatbot.
ChatGPT only knows what you tell it. If you feed it an incorrect number, it won’t know. If you forget to enter something, it won’t know. It may not even catch duplicated entries.
The workaround for both of these issues? Have a human check the work. It can be someone in-house or a bookkeeping service.
Privacy Issues
ChatGPT has many different plans. If you’re uploading or manually logging any sensitive data, please don’t rely on the Free, Go, or Plus plans. Pay for the Business plan to increase your privacy and increase the number of prompts you can enter.
If you don’t pay for that level of privacy or adjust your settings, then you may be training ChatGPT with your real:
- Bank statements.
- Payroll reports.
- Customer invoices.
- Tax documents.
Don’t want to take that risk? Use a tried-and-true classic accounting system, such as QuickBooks or Xero. And if you don’t want to use an accounting system yourself, outsource a bookkeeping service that uses one, like CSI Accounting & Payroll.
Why Accounting Firms Still Matter
AI bookkeeping has system, accuracy, and privacy concerns. Reputable accounting firms guarantee bookkeeping and tax compliance, accuracy, and privacy. But why else would you still want to hire an accounting service?
As you grow, your priority shifts from bookkeeping to guidance. Can you prompt ChatGPT to tell you what you need to know? Are you even giving it all of the information it needs to advise you? (With all of the details required, it’s highly unlikely.)
But a monthly accounting service (bookkeeping, monthly financial statements, consulting, and strategic tax services all in one) gives you a dedicated accountant who knows your business and your numbers. They work with you all year long to achieve your goals and minimize your taxes.
AI can’t do that… yet.
AI Bookkeeping, or a Reliable Advisor?
ChatGPT can perform some bookkeeping tasks, but you’re responsible for selecting the system, providing complete information, protecting the data, and knowing when professional judgment is needed. Now that you know this, are you ready to check out monthly accounting services with guaranteed compliance, accuracy, and privacy?
If so, please consider CSI Accounting & Payroll! To see if we can be a good fit for your business, click the button below for a free consultation:
Not ready to talk? That’s okay! First, try our Pricing Calculator to see what your investment may look like.
