AI Cuts Monthly Financial Close Time by 7.5 Days

Published Date : 14/08/2025 

A groundbreaking study by MIT and Stanford reveals that AI significantly boosts productivity, task allocation, and reporting quality in accounting firms. 

A recent study conducted by the Massachusetts Institute of Technology (MIT) Sloan School of Management and Stanford University Business School has unveiled remarkable improvements in productivity, task allocation, and reporting quality for accounting firms that adopt artificial intelligence (AI). The study, which analyzed hundreds of thousands of transactions from 79 small- and medium-sized companies, highlights the transformative impact of AI on the accounting industry.

Accountants deploying generative AI can upgrade the level of detail in financial reports by 12%, shift 8.5% of their time from routine, back-office processing to higher value tasks, and cut 7.5 days off the time needed to complete a monthly close. By using generative AI, accountants can devote more time toward analytical work, quality assurance, and communicating with clients, the researchers said.

On average, AI-using accountants support 55% more clients per week compared to non-users, enabling them to broaden their client service scope. These accountants also log more billable hours, indicating that AI helps convert previously non-productive time into client-facing work.

Advancements in AI this decade have improved accounting efficiency and accuracy, with machine learning sharpening fraud detection, predictions of earnings, forecasts of market trends, and risk management, according to research in recent years. At the same time, many companies use robotic process automation to streamline workaday tasks such as data entry and reconciliation, reducing errors and upgrading efficiency.

The MIT/Stanford study uniquely captures a complete perspective of how generative AI fundamentally transforms financial reporting and professional accounting practices. Researchers Jung Ho Choi and Chloe Xie surveyed 277 accountants, exploring how they adopted AI and viewed the benefits and hazards of the technology. When used by accountants as a collaborative tool, AI especially complemented the professional judgment of the most seasoned accountants.

“We find that more experienced accountants tend to leverage the AI system more strategically and reap larger performance gains from it,” the researchers said. Veteran accountants are skilled in interpreting metrics from AI measuring the reliability of its recommendations and, when the scores are low, tend to intervene more frequently than their less experienced colleagues.

Less experienced accountants may rely on the AI even when its confidence is low, or under-utilize the AI’s suggestions, resulting in smaller gains. These dynamics suggest that AI augments, rather than replaces, human judgment. The role of the accountant remains vital in supervising the AI, handling novel or complex cases.

The industry view toward AI is not completely sunny. While most accountants acknowledge the value from AI in streamlining their work, 62% voice concern about potential errors and inaccuracy, the researchers said. Overall, though, “generative AI can substantially augment accounting work without displacing the professionals who perform it.” Accounting firms that adopt the technology can yield remarkable improvements in productivity, task allocation, and reporting quality. 

Frequently Asked Questions (FAQS): 

Q: What are the key benefits of using AI in accounting?

A: AI in accounting can upgrade the level of detail in financial reports, shift time from routine tasks to higher value tasks, and significantly reduce the time needed to complete a monthly close.

Q: How does AI impact the number of clients an accountant can support?

A: On average, AI-using accountants support 55% more clients per week compared to non-users, enabling them to broaden their client service scope.

Q: What are the concerns of accountants regarding AI?

A: While most accountants acknowledge the value of AI in streamlining their work, 62% voice concern about potential errors and inaccuracy.

Q: How does AI complement the professional judgment of experienced accountants?

A: Experienced accountants tend to leverage the AI system more strategically and reap larger performance gains from it, as they are skilled in interpreting metrics from AI and intervening when necessary.

Q: What is the role of the accountant in an AI-driven environment?

A: The role of the accountant remains vital in supervising the AI, handling novel or complex cases, and ensuring the accuracy and reliability of AI-generated reports. 

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