Finance leader confidence in gen AI goes from 85% no to 87% yes in a year says EY poll

Confidence in generative AI has soared among financial operations and tax professionals, going from overwhelmingly negative to overwhelmingly positive in just one year. 

According to a recent poll from Big Four firm Ernst & Young, when asked, “Do you believe GenAI will help drive increased effectiveness and efficiencies within your tax function in the next three years?” the vast majority of respondents last year, 85%, said no. But things are very different in 2024. When asked the same question this year, the proportions had completely reversed, with 87% answering yes. As for why, EY pointed to advances in large language models and neural networks, increased computing power and storage, and further investment and innovation. 

In particular, leaders believe AI will be most impactful in the realm of data acquisition and cleaning; income tax and accounting; compliance; analytics and reporting; and planning. 

At the same time, 75% of leaders said they have either not explored or adopted any AI technology or have only just begun preliminary investigation into possible use cases. A further 17% have only just begun. Only 7% say they have fully integrated AI into their processes and are already driving value, and only 2% say they are at the forefront of generative AI adoption. 

As for why, poll respondents offered a wide variety of reasons. The two most common reasons had to do with data: 18% cited lack of accessible, high-quality data, and 14% said they were concerned about data security and privacy. Other reasons included lack of specialized talent, regulatory issues, unclear ROI, trouble understanding use cases, insufficient budget, concern over quality of results, resistance from team, and it simply not being a priority for leadership. 

“GenAI is already revolutionizing the tax and finance industry by helping manage complex reporting tasks and large amounts of data,” said Marna Ricker, EY global vice chair of tax. “It’s empowering tax professionals to have a transformative mindset, allowing them to be more efficient, focus on more strategic tasks and make better decisions. This will, in turn, unlock value for their organizations. While the survey indicates that many leaders are still grappling with how best to take advantage of the technology, now is the time to future-proof the tax function by developing a plan to integrate GenAI responsibly and with confidence.”

Meanwhile, although the majority of finance leaders and tax professionals said AI will not lead to headcount reductions, a significant portion thinks otherwise. 

The poll found that 56% of finance operations and tax leaders do not believe AI will reduce headcount at their organizations. While that’s a majority, a significant portion of poll respondents still think otherwise. In total, 44% of the respondents believe that AI will lead to headcount reductions at some level. The poll found that 34% believe headcounts will shrink up to 10%; a further 9% think it will be a 10-19% reduction; and 1% think it will be a 20-29% reduction.

Similarly, while more leaders say AI will help them perform their jobs better, there remained a material proportion who said it will make things worse. The survey found 39% said AI activities will give them a slight to moderate advantage in the performance of their function over the next five years, while 27% think the technology will lead to slight to moderate disadvantage in the same time period. 

In both cases, the difference between optimistic and pessimistic views was 12%. 

The report also found that 86% plan to reduce their tax and finance budgets over the next two years, and 45% will reduce headcount by 4% or more. The reasons behind this were not given, and so it is unknown whether AI was a factor.