PricewaterhouseCoopers LLP has teamed up with ChatGPT owner OpenAI to offer clients advice generated by artificial intelligence as the Big Four audit firms look to cut costs and boost productivity.
The accounting firm will use AI to consult on complex matters in tax, legal and human resources, such as carrying out due diligence on companies, identifying compliance issues and even recommending whether to authorise business deals.
The tie-up makes PwC the first of the Big Four to partner with OpenAI, which is regarded as one of the companies at the forefront of generative AI technology with its ChatGPT chatbot.
The major audit firms have been cutting costs to cope with a slowdown in professional services.
I-generated tax and legal advice can offer a number of benefits, including:
- Reduced costs: AI can automate many of the tasks that are currently performed by tax and legal professionals, which can lead to significant cost savings for clients.
- Increased efficiency: AI can process large amounts of data very quickly, which can help to streamline the tax and legal process.
- Improved accuracy: AI can help to reduce the risk of human error in tax and legal work.
- Greater access to expertise: AI can make tax and legal advice more accessible to businesses and individuals of all sizes.
However, it is important to note that AI-generated tax and legal advice should not be used in isolation. AI systems are not yet capable of providing the same level of judgment and expertise as a human professional. Therefore, it is important that AI-generated advice is always reviewed by a qualified tax or legal professional before it is relied upon.
Overall, the development of AI-generated tax and legal advice is a positive one. It has the potential to make tax and legal services more affordable, efficient, and accurate. However, it is important to use this technology responsibly and to always seek professional advice before making any important decisions.
PwC is freezing pay increases and bonuses for some of its 25,000 UK staff, Deloitte LLP is set to cut more than 800 jobs in the UK, Ernst & Young LLP is to cull about 5% of staff from its UK financial services consulting division, while KPMG LLP is planning to cut 125 consulting jobs.
The OpenAI partnership, which is not based on ChatGPT, won’t result in jobs cuts in the near-term, PwC said.
PwC’s new AI system is already “behaving like a 25-year tenure partner,” Bivek Sharma, chief operating officer for tax, legal and people at PwC UK, said in an interview Monday.
“The compliance burden globally is increasing and with geopolitics, the level of complexity that the C-suite is facing is like you’ve never seen before,” said Sharma.
“A lot of people talk about how there’s gonna be job displacement with AI, but the reality, to navigate these very complex situations, AI is going to be necessary to actually do that work.”
Harvey, an AI startup which is backed by OpenAI and specialises in professional services, is also part of the partnership.
The system is currently being rolled out in the UK, where around 650 staff will get access for testing and training.
The firm plans to expand access to 10,000 employees in more than 50 countries over the next few months. It will enable employees to run several major projects in the time it would take to run one and to a better standard, PwC said.
The partnership is also making possible large-scale projects which would have been too costly or lengthy before.
Professional services is “an area we’re quite excited about,” Brad Lightcap, chief operating officer at OpenAI, said in an interview over Zoom.
“These models can be really powerful assistants in legal workflows, in accounting workflows and tax workflows,” he said.
The Big Four audit firms have been doubling down on AI as they look to boost productivity.
Rival KPMG announced a multi-billion-dollar investment in Microsoft’s generative AI and cloud services, while Ernst & Young LLP recently launched a partnership with IBM to use AI to streamline HR processes.
Deloitte has expanded its partnership with Google Cloud to develop AI-powered solutions for clients.
PwC has also been using a chatbot service to help speed up tasks like summarising documents since March.
“The risk here is that, with their margins under pressure from salary inflation in 2021, professional service firms focus on using AI-embedded tools as a means of reducing costs rather than developing better solutions,” said Fiona Czerniawska, CEO of Source Global Research.
PwC didn’t disclose the value of the deal with OpenAI and Harvey but said the UK business is spending £100 million ($122 million) on AI this year.