How automation has changed what SMEs expect from their accountants

Traditionally, financial admin for small businesses meant collecting receipts, updating spreadsheets, packaging everything for an accountant and waiting to discover how the business performed that year.

 

This model is changing. But not because owners have suddenly decided they no longer need accountants. Instead, they are finding they only need them less for routine work.

 

Invoices can now be created and chased automatically, expenses categorised and filed as they happen and tax calculated on an ongoing basis. Instead of navigating several software subscriptions or waiting weeks for a meeting, owners can see what is coming in, what is going out, what remains unpaid and how much tax they need to set aside – all in one place.

 

For tens of thousands of UK businesses, this amounts to a quiet migration. Tasks that once required an accountant, bookkeeper or hours of manual work increasingly happen in the background, often without the owner consciously changing how their finances are managed.

 

The evolution of accounting

Businesses have not experienced an overnight transformation. Most entrepreneurs have not developed an AI or automation strategy. They simply used tools that gradually reduced previously unavoidable admin. 

 

The first generation of financial automation focused on tasks that once required a pen and paper: categorising transactions, reconciling accounts and calculating tax. As these became straightforward to automate, the role of accountants in the day-to-day running of a small business slowly changed.

 

Accountants are still important. Complex tax questions, strategic advice and situations requiring regulated professional judgement still require human expertise. But businesses no longer need to pay professionals to organise records or calculate standard financial information.  

 

From automation to always-on intelligence

AI takes this shift further. Financial software increasingly connects data on transactions, invoices, tax and cash flow with wider business context. This creates the potential for software to move from administrative tools that tell owners “what happened?” to always-on advisers that answer “…and what does this mean for me?”

 

ONS data revealed that the proportion of UK businesses using AI has risen from around 12% in late 2023 to around 35% today. As these tools become embedded in everyday business, entrepreneurs increasingly have access to information and analysis on demand, changing the relationship between owners and advisers. 

 

AI can help organise records, explain financial concepts and flag potential issues, while minimising admin that hinders growth. More advanced systems can also consider context. A fall in cash reserves might indicate a problem, but it could equally reflect planned investment or seasonal demand.

 

Trust is an important factor beyond adoption. New technologies often experience a time lag before becoming routine. Few remember the moment they became comfortable with mobile banking or online marketplaces; trust developed gradually through familiarity. AI is likely to follow a similar trajectory.

 

Why this matters for small businesses

This shift matters because Britain’s small-business economy remains under considerable pressure. In August, ONS data revealed 29% of businesses felt economic uncertainty was affecting their turnover, with 35% reporting higher staffing costs were impacting on turnover. In this environment, identifying pressures earlier and making better-informed decisions materially bolsters resilience.

 

These benefits are outsized for small firms, which often lack the time, resources or justification to hire specialists or procure complicated SaaS tools. Instead, they need flexible technology that solves immediate needs, from chasing invoices and calculating tax bills to analysing the pros and cons of an investment.

 

This is why these shifts progress with relatively little fanfare. Automation became mainstream because it removed friction from tasks people were already doing. AI will likely follow the same pattern, becoming embedded in existing processes rather than requiring businesses to consciously adopt new technology. As initiatives such as Make Tax Digital add pressure, businesses will continue gravitating towards tools that reduce the commitment required to remain compliant.

 

When small firms can anticipate cash flow issues sooner, understand their tax position more clearly, and reclaim hours previously spent on administration, they have more time and information to spend running and growing their businesses.

 

The migration is already happening

The changing relationship between small businesses and accountants is less about disruption and more about behaviour.

 

Businesses are not deliberately seeking less professional advice. Instead, the everyday work that made those relationships essential is fading. As bookkeeping, compliance and reporting become increasingly automated, accountants can focus less on administration and more on areas where human judgement adds value.

 

For owners, the question won’t be whether they are ‘using enough AI’ or whether technology can replace an accountant. Instead, it is whether they trust these tools to help save time, remain compliant and provide actionable information. 

 

That transition is already underway. And for many small businesses, the most significant change in how they manage their finances may ultimately be the one they barely noticed happening.

 

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Eduard Panteleev is co-founder and co-CEO of ANNA Money, the AI-powered business account that automates taxes and accounting for SMEs

 

Main image courtesy of iStockPhoto.com and Supatman