Accounting firms increasingly embrace AI tools

One of the world’s oldest professions is entering a new era. Like the advent of computer spreadsheet programs or the 10-key calculator before that, artificial intelligence and other automation tools are transforming how accountants do their work and serve their clients.

An industry that’s long operated by the books is warming to the idea of embracing bots. Last year marked a pivotal shift, as AI adoption at accounting firms nationwide more than quadrupled to 41% from 9% in 2024, according to the 2025 Wolters Kluwer Future Ready Accountant report. What’s more, 77% of firms surveyed indicated plans to increase their AI investments.

Those findings largely track what the Virginia Society of CPAs has learned through its member surveys: The largest accounting firms have blazed the trail with AI adoption, carving out a path for mid-size and smaller firms in the state to follow, says Tina Bates, senior vice president for strategy and innovation at the VSCPA in Richmond. And 2026 is likely to see more widespread adoption, she adds.

“AI is definitely something that everyone is trying to figure out how to utilize in some way,” Bates says. “Now, smaller firms are experimenting and getting curious about what AI could help them do.”

Even as early adopters report benefits ranging from reduced time spent on mundane or routine tasks or accountants who are freed up for more skilled work, adoption is often stymied by a lack of financial and staff resources for experimentation and verification, Bates says. Accountants have a commitment to uphold as trusted advisers to their clients, so they want assurance there’s a “human in the loop” to vet outputs, she adds.

What’s more, firms must weigh the potential for efficiency gains against the risk of compromising data security or client privacy. That’s why Keiter has been both judicious and selective about the technological tools it considers, says Gary Wallace, a managing partner at the Glen Allen firm.

“Security is paramount, but accuracy is probably the biggest challenge,” Wallace says. While Microsoft Excel changed how accountants did their work beginning in the 1980s, the technology didn’t necessarily make the job any easier or simpler, he says. “That’s how we’re looking at AI: How do we best use these tools to help our team be able to work better but also help our clients reach better decisions?”

Though the pace of adoption has been uneven thus far, as AI gains a bigger foothold in the accounting industry, it could reshape the type of services accountants provide and potentially address a long-running talent shortage. Here’s a look at how firms in the state are adapting and schools are preparing the next wave of accountants for this AI-enabled future:

Uneven adoption pace

The slower pace of AI adoption thus far at many midsize and small accounting firms is explained by a combination of legitimate concerns about privacy, coupled with a practical barrier to entry. Many accountants are eager to roll up their sleeves and explore potential use cases for AI, Bates says, but at firms where resources are already stretched thin, they’re often tripped up by a more basic question: “Where do we even begin?”

A spate of new accounting- and tax-specific tools has created a relentless volume of solicitations that arrive in Wallace’s inbox each week from companies trying to capture this market. While Keiter encourages experimentation by its employees, the learning curve and potential cost inherent to innovation must also be considered, he says. “We can’t try everything that comes down the pike.”

What’s more, for these tools to be useful, they require “mounds of data” that raise privacy concerns as firms weigh their options, adds Alex Woods, director of the Estes Center for Excellence in Accounting at William & Mary’s Raymond A. Mason School of Business in Williamsburg. “That’s a battle firms face as they consider developing their own customized solutions versus using broad-based ones.”

The Big Four firms have made extensive investments in proprietary AI and agentic AI tools to enhance their audit, tax, and advisory services. For example, EY has made a multiyear $1 billion investment in proprietary platforms that enhance audit quality, generate efficiencies and provide better insights for clients.

Such investments, though, are still unique; most midsize and smaller accounting firms in Virginia utilize off-the-shelf options and particularly Microsoft Copilot, which has largely become the AI tool of choice because it integrates so well with programs accountants already use and can easily automate tasks that were previously performed manually, Bates says.

Indeed, Keiter has incorporated Microsoft Copilot into its workflows, and the firm has developed protocols around its use, according to Wallace. Now when an audit team member relies on Copilot to make a decision, they include a note indicating AI assistance was involved, which ensures transparency and allows information to be flagged for further review if necessary.

But measuring AI’s benefits is challenging, as efficiency gains related to data collection, assimilation and processing may be offset by the learning curve and time spent verifying the accuracy of AI-generated information, according to Wallace. “We’re not going to just accept what’s spit out as output.”

What’s more, firms may be cautious about automating too many tasks because it’s important to preserve some simple tasks so that junior auditors have the space to learn and make mistakes under supervision, adds Bernhard Reichert, an associate professor of accounting at Virginia Commonwealth University‘s School of Business in Richmond. Firms are, of course, mindful that this technology could be very disruptive and don’t want to risk losing employees as they automate processes, he says.

“This is not just an issue about headcount, but also about the qualifications of employees — the talent part,” Reichert says. “Talent is often shaped through learning by doing, and that starts with small steps.”

Educators adapt

Because AI has become so pervasive on college campuses, many accounting majors will already be technologically adept once they enter the workforce. That dynamic underscores why it’s so important to teach students the fundamental concepts they must understand as accountants and encourage them to develop skills that will make them well-rounded employees.

At both William & Mary and VCU, AI best practices are woven into existing accounting coursework rather than offered as standalone courses. Woods and Reichert have seen the industry evolve during their careers and recognize the importance of preparing students for a profession that’s likely to further evolve in the future.

“The key thing we can do is teach students how to teach themselves,” Woods says. “They must learn how to learn so when the future changes — as it’s always going to do when the latest and greatest thing comes out — they can adapt.”

Now in his 18th year at William & Mary, Woods says that recruiters have time and again emphasized the importance of soft skills to students and new graduates, though what exactly constitutes soft skills always seems elusive. Some of the skills that employers desire in candidates simply come with time in a role, he adds, though new hires will need solid problem-solving skills if AI efficiencies see them taking on greater responsibility and oversight sooner than they would have in the past.

Reichert has likewise heard that same refrain from recruiters about the need for soft skills and has adapted some coursework — swapping an individual project for a group one, for example — to encourage students to think more critically about accounting concepts.

“What we are hearing is that practitioners do not necessarily demand more technology skills but rather focus on the skills needed for tasks that cannot in the immediate future reasonably be accomplished by AI,” he says. “I just hope we prepare students for jobs that are going to be there at some point in the future.”

Solving talent shortage?

There are signs of renewed interest in accounting career, though AI adoption certainly doesn’t deserve all the credit. That’s because there are now additional pathways to CPA licensure specific to Virginia. Starting this year, CPAs no longer need to satisfy the traditional 150-credit-hour rule, as people with bachelor’s degrees can become CPAs after working in the field for two years.

William & Mary has experienced a recent uptick in the number of accounting majors driven by a variety of factors, including that new pathway to CPA licensure, Woods says. Still, he suspects there will be a continued rise in the number of accounting majors ahead, and the business school will embrace AI as a tool that will change how accountants work, rather than putting them out of work altogether.

Even if it’s difficult to predict the future of the profession, particularly given the rapid pace of technological advancements, Woods says, the business school has added several one-credit courses led by practitioners that will help students prepare for shifting dynamics in the workforce.

And students themselves will naturally gravitate to pursuing the professions where they feel they have the best future, Reichert says. He’s seen several students switch from marketing to accounting this year as they’ve seemingly become stressed about their career prospects. If AI helps to address the burnout that’s seen many accountants leave the profession in the past, that may also make the major and subsequent career path more attractive to students, he adds.

“No one wants to invest in a career that is being made obsolete by technological progress,” Reichert says. “But at the end of the day, this is going to take a while to figure out.”

In the meantime, AI has become so normalized, Wallace says, that clients don’t push back or question Keiter’s use of the technology. In fact, embracing these tools helps the firm to remain competitive in attracting clients and prospective employees.

“If we were still sitting around using 10-key calculators and ledger paper, no one would want to come work for us,” Wallace says. “People are intrigued and interested about these new tools.”

Indeed, the next generation of accountants may play a bigger role than they realize in shaping the future of the industry. Firms across Virginia report that they feel their adoption of AI makes them more attractive to tech-savvy applicants, Bates says, which may encourage firms toward further technological adoption.

By relieving some labor pressure at firms, AI and other emerging technology may help to address the talent shortage in accounting, though it’s not the only solution and won’t serve as a replacement for humans, she adds: “There is always going to be a need for skilled CPAs and accountants.”