Business and operations
Accounting and Finance
The problem
The assistant proposes the VAT return: a wrong rate, an invented figure or a purchase invoice with no right to deduction passes because the return looks tidy. In payroll, a mid-month starter goes missing and an obligation is never declared.
30 courses · 5 specific to this profession
A process from your work
How long does a client's month-end close take you?
- Step 1The tool proposes an account for every bank transaction and invoice, and flags the ones it is unsure of.
- Step 2You start from the flagged lines and open the supporting document for any entry you would have made differently.
- Step 3Then you do the reconciliations and post the closing entries.
- Where the tool goes wrongThe proposed account can be wrong on the uncertain lines and for new suppliers.
- The verification stepCompare every uncertain line with its invoice or bank statement before posting.
More: what was measured and the full check
What changed, as measured
Accountants who used AI closed the monthly books 7.5 days sooner than those who did not, and their general ledgers were 12% more detailed.
Who was measured: Accountants in the United States and the small and mid-sized firms whose books they keep, comparing those who use AI accounting software with those who do not.
The caveat: An observational comparison among the clients of a single software provider, not a randomised trial; firms that start using AI may differ in other ways too. The figures are from the working paper version.
The check, step by step
- Before posting, filter the lines the tool flagged as uncertain and compare each one with its invoice or bank statement line.
- Reconcile every bank and cash account with its statement; a difference is explained, not deleted.
- For every new supplier or category the tool proposes, confirm the posting rule before you accept it for the months that follow.
- Close the period only when every flagged line carries the name of the person who checked it and the date.
The course covers reconciliations and adjustments with AI.
We can help you with this process: “Accounting AI: Financial statements and reconciliations”, 8 hours.
A documented failure pattern
“Fully deductible, with no limit”
- What the tool doesAn answer an AI tool drafts for an accountant to pass on to a client, who asked whether a lunch with business partners is deductible for profit tax.
- Where the tool goes wrongThe draft calls the expense fully deductible and drops the limit on representation expenses.
- The verification stepAdd up the year's representation expenses and compare them with the limit measured on annual revenue.
More: why it is easy to miss and the full check
Where the tool goes wrong, and why it is easy to miss
The draft applies the general test of Article 48 correctly (a real expense, in the business's interest, documented), so its reasoning sounds right. But it drops the end of that same article, "that are not subject to any limitation", and the limit in Article 50, point 1, letter g, on representation and hospitality expenses. That limit is measured on the year's total against 0.3 per cent of annual revenue, so from one invoice nobody can say "fully, with no limit". Because the draft cites no article, the reader has nothing to open and check, and the gap goes unnoticed.
The check that catches it
- Do not accept an answer on deductibility that cites no article. Open the updated consolidated text of Law no. 29/2023 on qbz.gov.al and read Article 48 together with the list in Article 50.
- Classify the expense with point 50.1 of General Instruction no. 26: a business meeting with partners or clients (representation, hospitality), or personal consumption by the company's own shareholders, which letter gj makes wholly non-deductible.
- Add up all of the year's representation and hospitality expenses and compare them with 0.3 per cent of annual revenue. The part above the limit is non-deductible in the profit tax computation.
- In the answer to the client, write the article, the limit, and that the final deductible amount is known only when the year is closed.
Where the failure pattern is documented: Professional-body guidance from the UK PCRT bodies on AI in tax work (January 2026); a Which? test report (November 2025); a UK First-tier Tribunal (Tax) decision (December 2023); a study in Artificial Intelligence and Law (July 2025).Sources: PCRT professional bodies, 2026; Which?, 2025; UK First-tier Tribunal (Tax), Harber v HMRC, 2023; Artificial Intelligence and Law, 2025.The case above is ours, written for work in Albania; the laws it names were checked against the official text.
What it looks like
The client's questionThe lunch with our business partners, paid by the company with an invoice: can we deduct all of it for profit tax?
The AI tool's draftYes. The lunch is a documented business expense, so it is fully deductible, with no limit.
Law no. 29/2023, Article 50, point 1"The following expenses are not deductible: [...] g) representation expenses and hospitality expenses that exceed 0.3 per cent of annual revenue."
Translated from the Albanian original.
Specialist courses for this profession
Accounting AI: Professional foundations and responsible use
Accounting AI: Tax practice and compliance
Accounting AI: Financial statements and reconciliations
Accounting AI: Payroll, records and data protection
Accounting AI: Preparation for assessment
What you leave with
A one-page checklist before the return is filed: every figure reconciled with the records, rates and deduction rights confirmed in the official source, the deadline. Alongside it, the reconciliation trail shows every link checked and every error caught.
Accounting and Finance
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